Segmentation, Target and Positioning of Apple

This report discusses the importance of Segmentation, Target and Positioning (STP) in the smartphone industry, with a focus on Apple. It explains how Apple uses psychographic and behavioral segmentation to target specific customers and how it positions itself in the market. The report also recommends the use of STP for businesses to attract their desired customers in the market.

1Running Head: Segmentation, Target and Positioning of Apple
SEGMENTATION, TARGET AND POSITIONING OF
APPLE
Name of the Student:
Name of the University:
Author’s Note

2Segmentation, Target and Positioning of Apple
Executive Summary
Segmentation, Target and Positioning is are the most important factors from a
company’s point of view if an organization properly carries out these three steps of
marketing, then without any doubt they will be able to reach out to their desired
customers in the market. STP model is a not a complex subject in marketing therefore,
the need of understanding the subject is exceptionally high. The current study
basically explains about the need and adequate implementation of the Segmentation,
Targeting and Positioning in the Smartphone industry. The different sections of the
study basically explain the details that have been used for the study regarding
marketing tool within an industry that is dominated by two main organizations, Apple
and Samsung.

3Segmentation, Target and Positioning of Apple
Table of Content
Chapter 1: Introduction..................................................................................................4
Chapter 2: Literature Review.........................................................................................4
2.1 Background of the Company...........................................................................4
2.2 Segmentation of the company..........................................................................6
2.3 Target market of the company.........................................................................8
2.4 Positioning of the company..............................................................................9
Chapter 3: Recommendation..........................................................................................9
Chapter 4: Conclusion..................................................................................................13
References....................................................................................................................14

4Segmentation, Target and Positioning of Apple
Chapter 1: Introduction
For a business to run successfully, it is essentially necessary to have certain strategy
through which they can attract customers in the market. Each organization have their
own products but there are thousand other companies selling similar products to their
customers. This is main reason why a business organization should focus in using
segmentation, target and marketing (STP) in their planning process such that they are
able to reach out to the appropriate customer whom they want to sell their products.
This report is going to discuss about the importance of segmentation, target marketing
by giving theoretical explanation. Furthermore, a company is also chosen and
explained how they have used STP to attract customers in order to increase their sales
in the market.
Chapter 2: Literature Review
2.1 Background of the Company
The company chosen is Apple Inc. which is a multinational corporation operating in
the industry since 1976. The founder of the company were Steve Jobs, Steve Wozniak
and Ronald Wayne and the company specializes in manufacturing personal computers
and smartphones (apple.com, 2018). It is one of the most successful companies in
today’s world with an overall revenue of around US$229 billion and net profit is
US$48 billion. The company is functioning steadily all around the globe by the help
of the proper marketing strategy and business concepts. The company is currently
functioning adequately by the help of its employee force as well.

5Segmentation, Target and Positioning of Apple
Currently there are around 500 retail stores all around the globe which are
successfully operated by the help of 123,000 employees. Apple basically deals in the
technological segment and produces laptops, desktops, smartphones and other
chipsets. The major services of the company are iTunes store, iOS app store, Mac
App, Apple Music along with the iCloud(apple.com, 2018). Headquarter of the Apple
Inc is located in the city of California, United States of America. Apple is also known
for the marketing tactics that are used to sell the products.
Additionally, from the studies it can also be stated that the Apple Inc. is considered as
the most innovative company around the globe. The latest product of Apple, the
iPhone X was successful in the market that allowed the company to gain a 17.9
percent market share in the smartphone business(Tanner and Raymond, 2015). The
same goes with the Samsung and the Galaxy S9 and S9+ is currently being the most
powerful smartphone.

6Segmentation, Target and Positioning of Apple
Figure 1: Market Share of Apple in the United States of America
(Source: Tanner and Raymond, 2015)
The representation of the market share of the Apple Inc in the figure above states that
the company has the largest share that is 42 percent in the United States of America.
The company also aims to increase its sales by the help of the upcoming Smartphone
segment that includes iPhone Xs, iPhone X Max, Galaxy Note 10 and Galaxy
S10.The innovation within the companies enables it to capture the highest market
share and also by the help of the proper segmentation Apple and Samsung is able to
target its customers.
2.2 Segmentation of the company
The psychographic segmentation allows the Apple Inc. to understand the interests,
opinions and activities and based on the analysis the company launches the products
that suit the best to the psychographic segment. Additionally, the behavioral segment
suggests that the customers are mainly affected by the brand loyalty, benefits,
readiness to buy a product, usage rate (Venter, Wright and Dibb, 2015). The reason
for Apple releasing two Smartphone recently is the basically to meet the demands of
the psychographic and the behavioral segments. The company releases a smaller
device to meet the demands of the behavioral segment whereas the expensive product
is launched for the people classified in the psychographic segment that allows the
company generate better profit.

7Segmentation, Target and Positioning of Apple
Figure 2: Segmentation of the Population
(Source: GenglerandMulvey, 2017)
Additionally, Apple is highly concerned about the lifecycle of the people and the age.
The younger people demand of better features in the smartphones and also demand
the higher software feature whereas the professional people demand of a sleek design
that could impress the other people (Kim and Lee, 2015). The segmentation of the
customers by the company is also done on the basis of the geographical location.
According to the different statistics the company is established in around 45 out of 50
states within the United States of America and the most important thing that can be
noticed is that the company is operating in around every country successfully
(Sawhney et al. 2017).
The statistical data suggests that the company is operating in around 18 countries by
the help of the 500 retails stores. The strategy of the Apple is established mainly to
expand its retail store in the other parts of the world so it is possible to reach to the
most of the customers(Schlegelmilch, 2016). Additionally, the geographic
segmentation of the company allows the company to analyze the sales within the

8Segmentation, Target and Positioning of Apple
region it is operating. The success of the company is directly based on the
segmentation of the customers in an adequate manner.
2.3 Target market of the company
The marketing strategy of apple to attract customers is pretty much different from
their competitors operating in the market. The type of strategy which apple uses to
target their customers is known as extensive targeting which incorporate differentiated
marketing strategy along with creating custom market programs that suits each target
market (Shank and Lyberger, 2014). When apple launches any new products, they
never launches a single item instead they produce three items of the similar product to
give each of their segmented target market an opportunity to buy their product. By
doing so, they not only gives equal chance for each of the segment to buy their
products but also increases their customer base with this sort of target strategy
(Gengler and Mulvey, 2017).
Figure 3: Target Market of Apple Inc.
(Source: apple.com, 2014)

9Segmentation, Target and Positioning of Apple
2.4 Positioning of the company
The positioning of Apple Inc. and Samsung also play a crucial role in the success of
the products and the company as a whole. The company uses the different elements of
the positioning in an appropriate manner that allows it to create a value for the
customers. The different elements of the positioning explain the aspects that are
successfully contributing to the positioning of the Apple Inc.
 Identity: The assets of the Apple Inc. and Samsung including its product have
a different identity in the market that allows the company to generate its own
identity. The company is based on the innovation and also focuses on the
employees that are focused on the innovation.
 Quality and Design of the Product: The Apple Inc. is largely focused on the
quality of the products and it ensures that the products are built with the best
quality of material just like in the iPhone X(Schlegelmilch, 2016). The
company stated that the smartphone is best till date. The materials and the
features within the phone made the company to achieve its main objective,
 Advertisement: The company is focused on the less the better strategy and
mainly ensures that the advertisements of the products are limited. This also
allows the company to generate the desired value (Gordonet al. 2015). The
mediums used to promote the products are also limited and mainly the
organization uses the social media platform for the advertisements.
Chapter 3: Recommendation
It can be recommended that a companies operating in the market must use
segmentation, target and positioning to attract their desired customers in the market.
Every company has the scope to grow in the market, because there are so many

10Segmentation, Target and Positioning of Apple
people with similar choices that there is a huge amount of opportunity to attract
customers of their choice. However, without having a proper target customer, and
knowledge about the strength of the product, it would less effective to invest in a new
market. The customers always wants to know about the product first and the benefits
which they are going to get after buying their product and if a company is able to do
so then for sure then can never lose a single money instead there will be craze for
products like iPhones. By the help of these techniques the organization has become
one of the most successful companies in today’s world with overall revenue of around
US$229 billion and net profit is US$48 billion. The company is functioning steadily
all around the globe by the help of the proper marketing strategy and business
concepts. The company is currently functioning adequately by the help of its
employee force as well.
Along with these another thing Apple should keep in mind is value proposition which
is keeping a balance between quality and price as both of these goes hand in hand. It
is also recommended that strategic target marketing can be considered as a model
which is useful when creating marketing communication plans. It is also
recommended that applying segmentation target marketing can help an organization
to engage with each desired group of customers in a much better way than sending
only a single message to each and every one. Segmentation is basically done to divide
each customer on the basis of behavior, demography and geographically.
Importantly, segmentation is important for various reasons firstly because it splits
buyers into different groups with same needs and this can be termed as buyer-based
marketing approach. Furthermore, it reduces risk and avoid the question that most
often arises which is where, how, when, and to whom an item is to be sold because by

11Segmentation, Target and Positioning of Apple
doing segmentation a firm can attract the right customers and increase market
efficiency.
As an example, the Apple Inc. and Samsung in the Smartphone industry majorly
understands the necessity of the market segmentation and therefore operates in the
differently in the market segments. The Apple Inc. basically applies the strategy of
segmentation which helps it to study the market in an adequate manner and also
allows it to target the specific customers. The product formation by the Apple Inc. and
Samsung is mainly based on the study based on the market segmentation. The
research carried out by the help of the two methods of segmentation majorly including
the psychographic and behavioral segmentation helps the company to understand the
lifestyle of the people.
Additionally, Apple is highly concerned about the lifecycle of the people and the age.
The younger people demand of better features in the Smartphone and also demand the
higher software feature whereas the professional people demand of a sleek design that
could impress the other people (Kim and Lee, 2015). The segmentation of the
customers by the company is also done on the basis of the geographical location.
With targeting, it can be described as the process that an organization uses to target a
particular set of customers in the market. The most important thing after segmentation
is targeting and this is where most organization fails because most organizations are
unable to subdivide their segments (Cui and Choudhury, 2015). Not everyone wants
the same products and customer has their own demand and needs which is what a
management should understand while targeting customers.
However, one thing which is constant is that they never compensate with their price
because they have a certain brand image in the market that only rich educated and

12Segmentation, Target and Positioning of Apple
high-class people living in the society can have the luxury to buy their end products.
This is the main reason why there is so much craze about such a single company and
it has never been like this before. No other product or company has the ability on
present day to do something which Apple and Samsung does and this is all thanks to
their combination of marketing strategy and segmentation, target and positioning.
As an example, it can be explained that most appropriate implementations is to follow
the study of Samsung and Apple which suggests that one of the main reasons for not
lowering their prices is because everyone can be able to buy it which is what they do
not want. They want their company to be at the top and only top people can
accomplish those advanced and innovative Smartphone in their hand. It is in itself a
great motivation for people who always wait for the type of innovation and
technology which they are going to make in their products (Alon et al. 2016). The
company’s targeting approach is far better and modern as it can be seen with the fact
their price of products is not similar at every place and it varies with the economic
condition of certain places.
Last comes the positioning, but it is the most important factor that brings down
customers to an organization. Positioning is about creating an image in mind of the
customers in such a way that they should think that the product which the
organization is selling is the best (Diamantopoulos et al. 2014). Though positioning,
an organization sends a direct message describing their products to their customers.
These set of recommendations provides the brief details regarding the usage of the
STP analysis for any industry and also for any organization. Apple is following its
best strategy while comes to STP. They are not following the old rules of horizontal
marketing as it is not applicable with the new style of marketing. Apple doesn't add
features or change products in a panic - it added a camera to the iPod touch only when

13Segmentation, Target and Positioning of Apple
it was ready, and even then, it was careful not to make it better than the iPhone X's
camera and all of its selling points. Whereas Samsung has their target market based
on age groups and the target market is attracted by distinguishing the Smartphone
manufacturers in the world.
Chapter 4: Conclusion
It can be concluded from the above assignment that the segmentation, targeting and
the positioning of a brand plays a significant role in the success of the company.
Moreover, the current study is based on the company, Apple Inc. and the usage of the
segmentation, targeting and positioning of the products to gain the highest profit. The
segmentation, targeting and positioning of Apple suggested that the products made
after the thorough analysis and research regarding the type of population.
The targeting allows the company to understand the target customers and the
positioning allows the company to understand its position in the market by the help of
the different factors that includes the brand identity, quality and the design of the
product and the techniques that are used for the advertisements of the product.
Furthermore, the research helped in understanding the benefits of the STP analysis
and would surely help in the future uses for the analysis of the other companies or
even the competitors of Apple.

14Segmentation, Target and Positioning of Apple
References
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theory, practice, and cases. Abingdon: Routledge.
apple.com. 2018. Introducing the new iPhone XS, iPhone XS Max, iPhone XR and
Apple Watch Series 4. Bigger screens are just the beginning. Available at:
https://www.apple.com/au/
Cui, G. and Choudhury, P., 2015. Effective strategies for ethnic segmentation and
marketing. In Proceedings of the 1998 Multicultural Marketing Conference, 1(1), pp.
354-358.
Diamantopoulos, A., Ring, A., Schlegelmilch, B. B., and Doberer, E., 2014. Drivers
of export segmentation effectiveness and their impact on export performance. Journal
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Dibb, S., 2017. Changing Times for Social Marketing Segmentation. In Segmentation
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Gengler, C. E., and Mulvey, M. S. (2017). Planning pre-launch positioning:
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Brand Management, 24(3), 230-249.
Gordon, R., Butler, K.A., Magee, C.A., Waitt, G.R. and Cooper, P., 2015. Using
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15Segmentation, Target and Positioning of Apple
Kim, K.Y. and Lee, B.G., 2015. Marketing insights for mobile advertising and
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Schlegelmilch, B. B., 2016. Segmenting Targeting and Positioning in Global Markets.
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performative perspective. Journal of Marketing Management, 31(1-2), 62-83.
Zia, M. and Kumar, N., 2016. A Three Dimensional Vertical Differentiation Model:
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