Apple Company Marketing Strategies

Introduction

The Apple Inc. is an Information Technology Company (ICT) that manufactures and distributes computers, mobile phones, and wearable devices among other products. The multinational company adopts various marketing strategies that promote its sales. This report provides an insight into the marketing plan, target customers, and decision-making processes that underpin the success of the Apple Company.

Product Description, Market Impact, and Literature Review

In 2010, the Apple Inc. launched the iPad. This product was a revolutionary touch-screen tablet that incorporated the functions of a smartphone and personal computer in one interface. The company released the iPad to the mobile electronics market. This device had advanced features that enabled users to surf the Internet, play music and games, store photos, and watch videos among other functions.

The size of the iPad and its battery life are key features that attracted many customers across the globe. Its compatibility with every application that is available in the App Store also won the attention of consumers. The iBook app, which allows readers to access volumes of information online, was an added advantage to many users. The adaptability and high-resolution screen makes the iPad a highly competitive and differentiated product when compared to other e-Readers that are available on the market.

On the first day of its release, the iPad sold approximately 700,000 units. The expected sales were estimated at about 7 million units by the end of 2010. Increased iPad sales boosted the company’s revenue in the fourth fiscal quarter of 2010. According to Van de Kaa and De Vries (2015), shipment of the iPad rose to over 4 million units. However, they grew to 54.8 million units the following year.

Research on Marketing Strategies Adopted by Apple Inc.

The Apple Inc. uses effective marketing strategies to create a buzz on the target markets for their products. This plan is geared towards generating interest and sustainable demand for the company’s products. Its profitability projection is easily obtained from the market impact and customer buzz from day one. The company uses Morgan Stanley Research in conducting market surveys to find out the level of interest of the population for the Apple Company’s new product (Ling et al. 2014). It also seeks the target segment of the population that is not interested.

A survey that was conducted in India in 2010 revealed that 21% of 2,500 tablet consumers expressed interest in purchasing the iPad. The chart in exhibit 1 indicates that 35% of those who were surveyed had a great interest in purchasing at least one iPad, while 65% were not. According to Ling et al. (2014), the survey identified the most effective marketing strategies for introducing new products in India. Carayannis, Samara, & Bakouros (2015) posit that this type of marketing strategy not only enables the Apple Company to determine product trends but also to evaluate various ways of enticing potential consumers to purchase the iPad.

A pie chart showing the interest level of consumers
Figure 1: A pie chart showing the interest level of consumers

Market Analysis for iPad

SWOT Analysis

The purpose of a SWOT analysis is to assess a product’s internal and external factors based on the targeted market segment. The internal factors that are subject to assessment include the product’s strengths and weaknesses. On the other hand, the external factors include the product’s opportunities and threats (Apple Inc. 2015). The table below shows the specific factors that leveraged the market entry for the Apple’s new product iPad (Challagalla, Murtha, & Jaworski 2014).

Table 1: The Apple Company: SWOT Analysis 2015

Strengths Weaknesses
  • Strong brand image
  • Strong financial performance
  • Focused research and development driving innovation
  • Product summons
  • Fragility
Opportunities Threats
  • Rapid growth in the smartphones market segment
  • Potential growth in demand for mobile PCs
  • Stiff competition
  • Dependence on specific suppliers
  • Loyalty of customers for other brands

Competitor Analysis

The iPad faces direct competition from the Amazon Kindle, Acer’s netbook, Dell’s netbook, and the Verison’s new e-Reader. The biggest challenge from some of the competitors is that some products offering similar functional capabilities are sold at lower prices. For example, the Amazon Kindle 3G is sold for $179. The Verison’s version of the iPad will be sold at $499.9. In addition, the iPad faces indirect competition from other products such as the iPhone, iPod Touch, and MacBook Air (Apple Inc. 2015).

Company Analysis

The Apple Company is engaged in the design, manufacture, and market of all its products including PCs and portable devices (Chuang, Morgan, & Robson 2015). It has over 260 outlet stores that are strategically located in 44 countries both regionally and abroad. This strategy has sustained its business at an international level.

Customer Analysis

Chuang et al. (2015) reveal that the iPad targets users who earn over 50,000 dollars per annum. 47-percent of the consumers who are interested in purchasing the iPad receive an income of more than 90,000 dollars annually. The iPad customers range from children to adults. Marketing in the company mostly targets the upper-middle class individuals who are regarded as highly educated.

Marketing Changes and Future

One of the objectives of the Apple Company is to provide customers with the best products at aggressive prices. The company often generates new products at competitive prices. According to the then CEO, Steve Jobs, the company embarked on marketing based on target markets, the products, pricing, promotions and place strategies. According to the Apple Insider (2015), the iPad was not meant to be a niche market product; it is rather intended to be the next mass-market product that is coveted by all. It also targeted individuals who are on constant move, including children of all ages.

The Apple Insider (2015) reveals that the iPad’s price was moderately set to lie between prices of the iPhone and the MacBook. In addition, the company uses social networking platform as a major component of the iPad promotion to reach great numbers of potential consumers.

The Apple Company uses personal selling to promote the iPad in its stores. Employee training is done to train them on the reasons for purchasing an iPad (Apple Insider 2015). Place strategy for the iPad aims at intensifying distribution to make the device available to potential customers worldwide. The company focuses on establishment of more retail outlets and online App stores to capture a wider market in the electronics and wearable devices industry.

Conclusion

The above discussion has provided an insight into the importance of establishing apt marketing strategies to gain competitive advantage in the electronics and wearable devices industry. The above analysis reveals that the Apple Inc. adopts various marketing strategies that have led to the realization of its goals. Sound marketing strategies have boosted the company’s sales significantly. Customer analysis is also a key strategy that has been applied in the company to determine the types of products that suit the market.

References

Apple Inc. 2015, Apple SWOT Analysis 2015. Web.

Apple Insider 2015, Apple gearing up for early-2015 MacBook Air refresh, begins pruning inventory & halting shipments. Web.

Carayannis, E., Samara, E. & Bakouros, Y. 2015, Innovation and Competitiveness: Case Study, Springer International Publishing, New York, NY.

Challagalla, G., Murtha, B. & Jaworski, B. 2014, ‘Marketing Doctrine: A Principles-Based Approach to Guiding Marketing Decision Making in Firms’, Journal of Marketing, vol. 78 no. 4, pp. 4-20.

Chuang, F., Morgan, R. & Robson, M. 2015, ‘Customer and Competitor Insights, New Product Development Competence, and New Product Creativity: Differential, Integrative, and Substitution Effects’, Journal of Product Innovation Management, vol. 32 no. 2, pp.175-82.

Ling, G., Fern, Y., Huat, T., Boon, L. & Lee, T. 2014, ‘Applied-information Technology for Brand Image towards the Usage of iPhone’, Advanced Materials Research, vol. 977 no. 1, pp. 491-5.

Van de Kaa, G. & De Vries, H. 2015, ‘Factors for winning format battles: A comparative case study’, Technological Forecasting and Social Change, vol. 91 no. 1, pp. 222-35.