Marketing Plan for iPad - Case Study Example

Marketing plan for iPad Table of Contents Executive summary 2 1.0 Introduction 3 2.0 Situation analysis 3 2.1 Internal analysis 3 2.2 External environment 4 2.2.1 Political/legal analysis 5 2.2.2 Economic analysis 5 2.2.3 Social analysis 5 2.2.4 Technological analysis 6 2.2.5 Environmental Analysis 6 3.0 SWOT analysis 7 3.1 Strengths 7 3.2 Weaknesses 7 3.3 Opportunities 8 3.4 Threats 8 4.0 Marketing objectives 9 5.0 References 9 6.0 Appendix 11 6.1 SWOT Analysis 11 Executive summary Apple Inc. is one of the renowned global companies in the information and technology industry. The company is known for its innovative products a fact that has made it its brand name strong in the market. In addition, Apple’s products are often considered simple and easy to use. The company basically targets the high income earners since the prices for its products are normally considered high compared to the substitutes offered by its competitors. In the world today, the youth are considered to be the wealthiest and thus Apple seeks to target the youths. However, the company’s pricing strategy seems to be a major weakness since the high prices keeps off some of its potential customers. The company faces stiff competition from Dell and Microsoft, considering the fact that these companies offer cheaper substitutes in the market, and thus there is likelihood that the company could achieve higher sales if it charged affordable prices. It is also important to note that the company develops marketing objectives that guide the marketing process of its products, in aim to attain the company’s vision. For instance, the company seeks to attain an increase in the company’s revenue by 20 per cent at the end of one financial year. 1.0 Introduction Previously known as Apple Computer, Apple Inc. is a multinational corporation that is based in America that designs and sells computer software, personal computers and consumer electronics. The company was established in 1976, and has developed to be the global leader in the technology and telecommunications industry. It has estimated annual revenue of approximately $60 billion, which is attributed to the company’s distinctive marketing and advertising campaigns and its well-established brand name (Erick, 2009). Apple Inc. vision is to become a global leader in the consumer electronics industry. It is the CEO’s dream that come 2020, every desk will have Apple computer. Its mission is to continue producing revolutionary and innovative products to its consumers such as iPhone, iPads and iPod. 2.0 Situation analysis 2.1 Internal analysis Apple Inc. is always known for its innovative products, designing and introducing products such as iPad and the Imac. The company’s brand name is well established in the global markets and it is often associated with user friendly and easy to use products (Barnett, 2008). This has also enabled the company to expand its global appearance, which has made it develop relationships with some external contract manufacturers. An important aspect about Apple is that it always emphasizes on the development of user friendly computers, an aspect that has created brand loyalty from its customers. Apple basically targets the high income earners as they produce products that are distinct and considered high in technology. However, it is certain that, many young people are tending to be wealthier than the older generation. This is due to increased literacy levels in these groups of individuals and availability of employment opportunities. Therefore, it is certain that, Apple will target the youths who have the technological knowledge of using the company’s innovative product. Its advertising campaigns emphasize on the company improving people’s life, with the highest newest technology, and leading the world (Sharp and Dawes, 2001).  Through the ads, the company is unique from other high-tech firms for instance, Microsoft. Apple positions itself as the number one main concern in the business and emphasizing on the brand's repute of constantly being the best (Keller, 2009). Apple Inc. distributes its products through wholesalers, resellers, both national and regional retailers and cataloguers, who distribute products from Apple’s competitors. It also deals in direct selling as well as through online stores. 2.2 External environment Apple has managed to attain a global appearance since its products are currently marketed all over the world. However, competition is intensifying as a result of product similarities and slow market growth, considering the fact that most its competitors offer similar products at a considerable low cost compared to Apple’s prices. Some of its competitors include, Dell, Microsoft and HP. To elaborate on the company’s external environment, the PESTLE analysis will be applied. 2.2.1 Political/legal analysis Nations have diverse legislations which in some way may influence the way businesses are carried out. These legislations may restrict or give opportunity to such companies (David, 2010). Apple is faced by various political/legal factors including: Safe disposal or recycling, which ensure the Apple develops measures to deal with the same to ensure it keeps in line with legal requirements The company also depends on access to intellectual property and patent acquired from third parties. As a result, apple might encounter infringe problems with existing patent of others. 2.2.2 Economic analysis Since 2005, the company has opened approximately 100 retail stores. These stores, though they are potentially beneficial are having negative impacts on the resellers business and some might have to be even closed down. Taking into account that, Apple’s resellers still account for over 50 percent of its domestic sales, it is facing the risk of cannibalization and may suffer deeply. In addition, the government has ensured a stable macroeconomic environment for the industry. This general stability, stable currencies, low interest rates, and international competitiveness form a basis for the growth of the company. 2.2.3 Social analysis Social cultural trends begin and end with the youth or the teenagers (Kotler and Kevin, 2006). Currently, the purchasing power of the teenagers has increased at a high pace. These people are also seen to be brand conscious as they believe that certain brands will enable them to fit in a certain social grouping. Additionally, education has resulted to be a primordial matter for the new generation and this is a significant factor for Apples business. 2.2.4 Technological analysis Technological innovation is seen as one of the major factors leading to the growth and success of the Apple Company (Helft, 2011). Currently, technology is developing at a high pace and individual appreciate new advances in their systems. Increased demand for more and new technologies in various professions and in schools has increased the company opportunities. The constant change in technology in the twenty first century has affected almost all industries and has resulted to a shortened product life cycle (Wild et al. 2008). In order to remain competitive in the market and increase the market share, Apple incorporates innovation. 2.2.5 Environmental Analysis Apple .Inc has managed to be environmentally friendly and the company does not engage in unethical practices that the consumers have huge offence to. In addition, the company has established measures for recycling to ensure that, it abides with environmental regulations thus remaining environmental friendly. The company has been very careful concerning this issue making its brands very popular and successful globally. 3.0 SWOT analysis 3.1 Strengths Apple is considered as one of the most successful companies around the globe. One of the success factors behind Apple Inc. is its strong brand name. The company has made a global presence due to its well-established brand name, an aspect that could also be applied in marketing the iPod. Apple can also benefit from the economies of scale since it has a well-established relationship with its supplies and retailers. The company also manufactures products that are simple and can be used with ease and is therefore able to attract more customers to purchase it (Helft, 2011). Apple has also established continual investment in research and development to facilitate further discovery of its potential markets and the innovation of improved products and technologies. Furthermore, the iPad has features such as the super wi-fi connection as well as internet pages that give its users an ultimate experience. It also has a good display as well as its external design, with a high quality battery that can last for about ten hours. 3.2 Weaknesses Apple’s products are highly priced and, therefore cannot suit the target market. The Ipad comes as a hybrid between a notebook and a phone, which is expected to have a price that its customers can afford, but then the price charged for this product is high considering the fact that it lacks some essential features. It is also apparent that iPad does not offer background execution or multitasking, and its virtual keyboard is not featured as a real-sized one. The simplicity and ease of Apples often results in image problems since the one of the company’s earlier innovations Macintosh, is regarded by some businesses as a toy. 3.3 Opportunities The company can make use of its strong brand name to target other markets and break into other markets that have never been reached (Erick, 2009). Some of its earlier products such as the iPhone have been a great success, and have managed to attain customer confidence in the company’s products. The company can also tighten its relationship with other companies; with an aim of developing joint ventures that will enable the company thrive. It can for instance, merge or acquire some of its strong competitors to ensure the company remain influential in the market (Erick, 2009). Considering the rate of online marketing increase, the company can use this opportunity to direct more efforts to the online sale of ITS Ipad in order to reach more customers. 3.4 Threats Apple Inc. faces stiff competition from other companies such as Dell, Microsoft and HP. When it comes to pricing, Apple’s iPad is considered to be highly priced compared to the prices for the products offered by most of its competitors such as Dell. This has a result in a shift whereby most people prefer the products offered by Apple’s competitors as they are considered to be affordable (Marc, 2009). Moreover, the world of technology is rapidly growing which therefore means that the company has to remain innovative in order to remain effective in the market. 4.0 Marketing objectives Apple Inc. established various marketing objectives that will help the company achieve its major product goal, as well as realizing its vision.  From the sales of iPad Apple seeks to attain the following marketing objectives; Increase its overall sales by 20 per cent at the end of one year Increase the company’s revenue by 20 per cent at the end of one financial year Increase the market share by 15 per cent at the end of year Attain a 60 per cent increase in its brand awareness 5.0 References Armstrong, G. & Kotler, P. (2000). Marketing: An Introduction. Singapore: Pearson. Barnett, R. (2008). Global Reach: The Power of the Multinational Corporations. Oxford: Oxford University Press David, R. (2010). Strategic management: concepts and cases. Upper Saddle River: Pearson Prentice-Hall. Erick, F (2009). What’s Apple Stock Really Worth? London: Cambridge University Press. Helft, M (2011). "Jobs Returns to Introduce a New iPad", The New York Times. Available at http://www.nytimes.com/2011/03/03/technology/03apple.html?_r=1&scp=10&sq=iPad%202&st=cse  (Accessed on March 24, 2011). Keller, F. (2009). Market Positioning & Framing Market Research, London: Oxford University Press. Kotler, P. and Kevin, L (2006). Marketing Management (12 ed.). New Jersey: Prentice Hall. Marc, A. (2009). Effects of Globalization to small businesses in Europe. Harvard: Harvard University Press. Sharp, B. and Dawes, J. (2001). "What is Differentiation and How Does it Work?," Journal of Marketing Management, 17, pp. 739-59.  Wild, J. J., Wild, K. L., & Han, J. C. (2008). International business: The challenges of globalization. (4th ed.). Upper Saddle River: NJ: Pearson. 6.0 Appendix 6.1 SWOT Analysis Strengths Brand name Innovative products Quality products Overall global presence through its retail outlets Ease and simplicity of product usage Weaknesses High price for the products Simplicity of use results in image problems Opportunities Make use of its brand name to increase its market share Acquire other companies to increase its dominance in the market Threats Stiff competition from Microsoft, Dell and HP Need for increased innovations Read More