Apple Company’s Marketing Strategy Analysis

Introduction

Apple Inc. is an American multinational company, which manufactures and designs computer software products and consumer electronics. Ronald Wyne, Steve Wozniak, and Steve Jobs formed the corporation in 1976. The company is best known for hardware products such as the iPod, iPhone, iPad, and Macintosh computers. The software products include the final cut studio suite of professional audio and film-industry software products, namely iTunes, iLife multimedia set, and creativity software.

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Other items include the iWork suite of productivity software, logic studio, which is a collection of audio tools, and Mac OS X operating system. Apple Inc. operates in more than eight countries. It has an excess of 250 retail stores, including an online store where its products are sold. This paper presents the company’s current marketing strategies concerning the 4Ps. It also presents the advantages and disadvantages of the marketing strategies before suggesting a new strategy that the company can embark on to improve its profitability in its target market.

Apple’s Current Marketing Strategies

In 1985, when Steve Jobs left Apple, the Macintosh series and the Apple II were competing against personal computers from the International Business Machines Corporation (IBM). Apple was losing in the competition since it was experiencing a hard time in terms of sustaining its sales. Lastly, it lost the battle to Microsoft computers, which had its flagship brand of window-based PCs. Apple’s was overpowered because of the company’s meager marketing plan.

Its computers were deemed perplexing and superfluous. Hence, when Steve Jobs resumed as the company’s boss in 1996, he resorted to ending and disposing of all supplies that were classified as unbeneficial. He also realigned the company’s marketing plan that is founded on the model of simplicity and first-class consumer experience. This model incorporates customer-friendly applications. This strategy has been in place up to date.

Apple’s Marketing Mix: The 4Ps

Apple’s Products

The company has constantly expanded its product mix, which determines the firm’s outputs. For instance, Apple’s main products include MacBook, Apple Watch, iPad, iPhone, Apple TV, and the iPod among other software. The availability of these products in the market reveals Apple’s strong firmness when it comes to diversification. Moreover, the company is continuously developing new products such as its collaboration with Tesla Motors. The partnership is aimed at establishing Apple’s electric car. The company has even gone a step further to hire Chris Porritt, the former Tesla Vice President, to steer the process. Such an extensive product variety ensures that different customer’s needs are succinctly addressed (Cruikshank 41).

Apple’s Place or Distribution

Apple’s stores are the major retailers of the firm’s products. The company’s supplies also include online stores, Apple Store, and the App Store. The company has operations in Europe, the Middle East, Africa, Asia, and America. Other places, which are also part of the corporation’s strategic distribution plan, are telecom companies such as Verizon, AT & T, Sprint that deals with iPhone units, and Authorized retailers such as Target, Best Buy, and Wal-Mart. Moreover, Apple uses platforms that include eBay where its products are sold online by third parties (Constantinides 407). Therefore, Apple’s operations are comprehensive in both online and terrestrial channels of distribution.

Apple’s Promotion

The promotional activities done by Apple emphasize the company’s high-end image and product quality. The promotional mix that includes private sales, deal promotion, advertising, and public relations assists the company in acquiring more customers (Hartline and Ferrell 18). Hence, the plan has led to the achievement of more sales. Personal selling commences with the company’s employees who provide relevant information to customers regarding any of the business’ products.

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The majority of sales promotions happen at Apple Store. Here, the sales entail price discounts on old Apple models. Advertising is done through Apple Stores, website, or even through other companies, for instance, technology news sites, or even other platforms that have high traffic. Finally, the concept of public relations (PR) is used to enhance the company’s corporate image. Examples of PR include a press release, leaks of new products and their features, exclusive interviews, or even Apple Events, which can positively transform the company’s publicity when carefully implemented.

Apple’s Pricing Strategy

Apple’s product prices are relatively higher when compared to other related items. The pricing strategy is first-class since it caters to the expectations of consumers. It also represents the products and the company itself. This pricing policy enhances Apple’s image as a high-end company that deals with high-class products. Therefore, it attracts a restricted market share of upper and middle-class people. However, this strategy does not affect the company’s profitability since high-profit margins are acquired from the premium pricing (Danaher, Hardie, and Putsis 504).

Apple’s Target Market

The main target market for Apple’s products includes middle and upper-income consumers who are capable and willing to pay a higher amount after being enticed by a better user experience. For instance, a normal PC goes for around USD 350 whereas a MacBook would set a purchaser back by USD 900. If the customers have a higher disposable income, a highly-priced item would not be an issue for them.

Besides, Apple targets media, music, and design experts who have specialized software for their work. Such people include music producers who use logic studios or motion picture directors who use the final cut studio collection. Other targets include business people who are highly intrigued by Apple’s products such as iPads, iPhones, and MacBooks. Each item here has a useful business quality such as enhancement of communication with clients. Besides, seminary and students in institutions of higher education use iPhones, iPads, and MacBooks to record notes. The gadgets’ insubstantial weight makes it convenient to carry from one place to another.

Advantages of Apple’s Marketing Strategies regarding its Target Market

The success of Apple’s marketing strategy is dependent on the company’s ability to identify its competitive advantages. One of the major advantages of Apple’s marketing plan is that it is effective to the extent that it satisfies consumers’ behavior, tastes, and inclination. This effectiveness can be attributed to its core competence in delivering a unique customer experience through exceptional user interfaces.

For instance, the iPhones’ touch-screen ‘gestures’ are also useful in the iPad. Moreover, iCloud, Mac, the App Store, and iTunes are all disruptive business models that have managed to alter the status quo in the telecommunication industry. Also, the unique features of Apple Pay or the Apple Watch create a memorable customer experience. Another advantage that Apple boasts about revolves around its excellent market communication and its positive appeal to the target consumer. According to Gaille, 54% of customers who acquire an iPhone also confirm that their previous phone was an iPhone (par.3).

Hence, Apple is distinguished to have the most loyal customers, thanks to its unique brand. Consumers buy the products, regardless of the higher prices, citing originality, competence, neatness, and user-friendly interface. Such a strong level of brand loyalty shows that Apple’s marketing strategy is well functioning and superbly aligned towards its target market. Apple’s marketing communication is highly effective. Such a communication approach takes the form of a TV classified ad, print, merchandise positioning, and open-air advertising.

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However, to get value for money, Apple, in most cases, relies on product placement, especially with popular shows that feature moguls and celebrities. It also relies on the positive reviews offered by critics in media based on consumers’ publication testimonials. These testimonials, which are verified through user accounts and profile pictures, offer advice to potential customers on the suitability of Apple’s products.

Another advantage of Apple’s marketing strategy is that it has avoided price wars by focusing on its unique value proposition. It has created a niche market for its items. Apple understands that price wars translate into deteriorating profitability where each company wants to prove that it is the cheapest in terms of service provision, regardless of product quality. Apple has focused on its Unique Value Proposition (UVP) model that features beautiful designs and other unique aspects, which justify its higher commodity prices.

Lastly, another advantage of Apple’s current marketing strategy lies in its market segmentation, which offers a commercial advantage over competitors in the same field. Market segmentation refers to the process of dividing a large group of consumers into smaller and convenient groups. This scenario may be explained by Apple’s development of the iPhone 5c and 5s. Despite being similar, the products were minimally differentiated whereby each item was made for a different target market.

Disadvantages of Apple’s Marketing Strategies regarding its Target Market

Unlike the time of iPhone inception by Apple where it enjoyed an advantage over other regular phone models, today’s Smartphones have similar or even better functionalities when compared to the iPhone. Therefore, stiff competition makes it highly difficult for Apple to maintain consistency and product quality. Secondly, poor marketing of Mac Mini and Apple TV led to the witnessed minimal product absorption by clients.

Hence, the sales were marginally low because of Apple’s move to shun the traditional advertising mediums such as television commercials and outdoor advertising. Thirdly, through its flagship music streaming service, Apple’s iTunes has remained unyielding based on the increasing actors’ pay. This situation has led to huge losses in revenue following music actors’ move to embark on other song-streaming services such as Spotify and Pandora (“AppleInsider” par.2). Lastly, Apple’s premium pricing for its customers has also led to a huge loss of potential customers.

Formulation of a New Marketing Strategy

Apple should partially change its perception of high-end products and introduce low-priced products to cater to the lower class of consumers. Such a dynamic marketing strategy can optimize the company’s demographics. The telephony industry has a higher number of consumers. Moreover, the company should also develop a motivation system for loyal consumers. Finally, Apple should formulate a system of educating American society on proper business and ethical values that can lead to its global success. It can inculcate such values to create innovators from the next generation.

Conclusion

The paper has discussed Apple’s current marketing strategy. The strategies have been advantageous to the target market. However, the paper has also pointed out various drawbacks that such strategies have experienced. As a result, it has suggested the need for a new strategy that captures even the low-class customers who wish to enjoy the company’s products.

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Works Cited

AppleInsider: Apple Music to Miss Out on Taylor Swift’s ‘1989’ Album 2015. Web.

Constantinides, Elliot. “The Marketing Mix Revisited: Towards the 21St Century Marketing”. Journal of Marketing Management 22.3 (2006): 407-438. Print.

Cruikshank, Jeffrey. The Apple Way, New York, NY: McGraw-Hill, 2006. Print.

Danaher, Peter, Bruce Hardie, and William Putsis. “Marketing-Mix Variables and the Diffusion of Successive Generations of a Technological Innovation”. Journal of Marketing Research 38.4 (2001): 501-514. Print.

Gaille, Brandon. 18 Key Apple Target Market Demographics 2015. Web.

Hartline, Michael, and Oliver Ferrell. Marketing Strategy, Text, and Cases, San Francisco: Cengage Learning, 2005. Print.

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