MG412 Principles of Marketing: Apple Brand Extension Strategy Report

This report assesses Apple's brand extension strategy, proposing holographic gesturing for its devices. It examines Apple's company background, brand value, and growth strategies, utilizing Ansoff's matrix for market penetration and development. A PESTLE analysis highlights technological and social factors driving the idea, targeting segments like medical professionals, businessmen, gamers, and educators. The report also identifies VNTANA as a key competitor, noting Apple's strengths in brand recognition and market experience despite the competitor's lower pricing. The proposed extension leverages holographic technology to differentiate Apple's products and capitalize on current technology trends. Desklib offers a wealth of resources, including past papers and solved assignments, to support students in their academic pursuits.

Apple
Brand extension

Company background
• Founded by Wozanik and Steve in 1985, the company
branched into different units of manufacturing. (Apple,
2019)
• Although headquartered in America, most of the
manufacturing operations are carried out in China.
• By the end of 2012, about 16% of the total smartphones
sold worldwide were Apple products. (Facts, 2019)
• The market share is comparatively low in developing
countries like India and Brazil.
• In 2018, Apple secured 51% of the total global market
share in smartphones and tablets.

Brand value of Apple
• The brand was launched in market back in 1984, with the
introduction of a personal computer training program at the
Super Bowl.
• Since then, Apple has been conducting advertisement campaigns
featuring celebrities and airing advertisements made by the
creative team of the company. (Sponsorship, 2019)
• Apple has collaborated with private technology firms for
promoting their products.
• The official website of Apple is one of the most uniquely designed
technological sites in the world.
• Apart from sponsoring the Super Bowl committee, Apple supports
several charity programs in and outside America.

Growth strategy of new product
• Holographic gesturing for all Apple devices is the new product idea.
• The 3D system can create an invisible space for the user, enabling
him/her to operate via holographic images and control the screen,
switches with only their gestures. (CelticsBlog, 2019)
• Apple has adapted Ansoff’s growth strategy for succeeding in the
market.
• The market penetration will be accomplished by offering seasonal
discounts and promoting the product at social events.
(En.wikipedia.org, 2019)
• A new market segment in different countries will be identified for
developing the market of the new product.
• Adequate research has gone into designing the product for
differentiating it from anything already available in the market.

Pestle factors that prompted the
idea
• The technological factors in the Pestle analysis suggest
that Apple has all the adequate resources to innovate its
products.
• As per the social factors, the target market of Apple
consist of upper class businessmen and financially affluent
teenagers.
• This section of the target market would be particularly
fascinated by holographic gesturing devices since it is
both time saving and unique.

The design

Proposed target market
• . The product could be put to medical applications in
clinical settings, so hospital owners would comprise a
major target segment.
• Established businessmen who could benefit from their
saved time would be a suitable target.
• It is also a desirable product for gamers, hence young
college students should be targeted both for extending
brand value and profitability.
• Educational and training organizations would benefit from
the product.

The mechanism

What influenced
the idea
• The technological aspect of Apple’s PEST
analysis suggest that the product innovations
are too mainstream.
• A brand extension calls for a remarkable
product differentiation, and holographic
gesturing introduced in the existing Apple
devices is breakthrough consumers have been
desiring.
• Holograms and visual impressions are
popular trends in the technology market.

Key competition
• The chief competitor in the new market sector
is VNTANA.
• The company engages in promotional activities
by collaborating with popular brands like Pepsi
and Lexus.
• However, Apple is still the more recognized
brands among the two and is more updated
than VNTANA.
• The competitor brand is a new company
whereas Apple has been in the market for over
35 years.
• The rival company offers lower charges, this
can cause consumers to switch to a relatively
lesser known brand.

References:
• Apple. (2019). Site Map. [online] Available at: https://www.apple.com/sitemap/
[Accessed 25 Jan. 2019].
• Extensions, B., Extensions, B. and weergeven, M. (2019). Apple is everywhere.
[online] Brandextensions1.blogspot.com. Available at:
http://brandextensions1.blogspot.com/2010/11/apple-is-everywhere.html
[Accessed 31 Jan. 2019].
• Facts, A. (2019). Topic: Apple. [online] www.statista.com. Available at:
https://www.statista.com/topics/847/apple/ [Accessed 25 Jan. 2019].
• Heath, A. (2019). Apple Working on 3D Displays With Holographic Gesturing
for Future Devices | Cult of Mac. [online] Cult of Mac. Available at:
https://www.cultofmac.com/113497/apple-working-on-3d-displays-with-
holographic-gesturing-for-future-devices/ [Accessed 25 Jan. 2019].
• Sponsorship, A. (2019). Apple Sponsorship - Apple Community. [online]
Discussions.apple.com. Available at:
https://discussions.apple.com/thread/1669095 [Accessed 25 Jan. 2019].