Essay on Marketing - Apple and Sony

MARKETING
ESSAY

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Marketing is referred as the tactics of an organisation to buy and sell a product or service.
It involves selling, delivering and advertising commodities to the customers. Marketing
incorporates market research, public relations, customer support and product development. This
present assignment is written in context of Apple and Sony. Apple is a US based multinational
organisation, situated in California. Company deals in computer software, online service and
consumer electronics (Wilson and et. al., 2012). Sony is a Japan based Multinational
conglomerate company, headquartered in Tokyo. Company offers electronics, gaming, financial
and entertainment services. This essay includes international marketing strategies of Sony and
Apple in different nations by specifying price, product, promotion and distribution. Also,
segmentation, targeting and positioning is carried out in respect with Apple and Sony. Beside
this, different market entry modes are discussed to evaluate marketing strategies in desired
manner.
MAIN BODY
Internationalisation is defined as the enhanced involvement of organisations in
international markets. It is related with international relations, alliances, treaties and
international trade. Many times terms like internationalisation and globalisation are confused
and considered to be same but this is not the case. Globalisation is the economic integration of
different national economies into a unified global economy. This is carried out with the help of
free capital mobility and free trade. Apple is a renowned company which deals in computer
software and consumer electronics. Hardware products offered by Apple are iPad tablet, iPhone,
iPod media player, Mac book, Apple TV, Apple smartwatch and HomePod speaker. Main
software offered by company are macOS, safari web browser, iOS, iWork, iLife and iTunes.
Online services of Apple includes iOS App store, Mac App store, iCloud, iOS App. In terms of
revenue, Apple is the largest IT firm globally. At present Apple is the only U.S. Organisation to
be valued around US one trillion dollars (Peattieand Belz, 2013). Due to immense popularity,
Apple is considered as the most valuable brand worldwide. Brand value of Apple is 300.6bn
USD and company is enjoying unparalleled revenue growth. This can be acknowledged from the
revenues sales which was 8 billion U.S. Dollars in 2004 but in 2015 it was around 240 billion.
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According to a report, unit sales of iPhone is 217. 72m. Company sales 18% of their
smartphones worldwide and earn around 85% of profits form it. iPhone is the most popular
product offered by Apple. In this respect, sales of iPhone form 2007 to 2018 is depicted with the
help of a graph.
This statical data clearly depicts that Apple has successfully emerged as a most valuable
brand at global level. Stock value of Apple in 2018 was around 208 dollars per share. As
compare to the stock value in 2001, stock value in 2019 is increased by 15,966%. This
considerably high stock value is achieved by Apple with the help of strategic acquisitions and
investing in technology to gain competitive advantage over rival companies.
Sony corporation is a multinational company situated in Tokyo, Japan. Company is a
global leader in consumer electronics. For the year of 2017, revenue of Sony was estimated
around 68 billion U.S. Dollars. Along with this, company also invests in music divisions,
financial service segment and motion picture film segment. In the field of network services and
gamings, annual revenue of Sony is approx 14bn US dollars. Global revenue of Sony company is
77.06bn USD and Unit sales of PlayStation 4 is 19m. Mobile communication of company which
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is Sony Ericsson Mobile Communication is considered as a leading manufacturer in mobile
phones. In 2017, around 8.5 percent of sale have been achieved by Sony through mobile
products. In case of TV and LCD, company has a market share of around 5.6% which ranks fifth
at global level (Lovelock and Patterson, 2015).
This graph shows the revenue of Sony form 2007-2017. Overall performance of company
have not gained a continuous increment in every financial year. But company was successful in
representing itself worldwide. For financial year of 2018, revenue sales of Sony was around 8.5
trillion yen. In 2017, Sony has sold around 13.5m smartphones. But in 2018, a decline of 3.5m is
noted. Most of the revenue of Sony came form its gaming and play stations.
Apple and Sony has successfully represented itself in worldwide. Countries like UK, France,
Italy, Australia are developed markets for Apple where as India and China is considered as
emerging markets. In case of Sony, emerging market is India and developed market is U.S.
International marketing involves the process of positioning, creating, planning and
promoting products worldwide. In case of Apple, Company offer innovative and new products to
gain wide appreciation form customers. Some of the popular Products offered by Apple are
Mac, iPhone, iPod, Apple watch, Apple TV, Software and services. iPod is a portable digital
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music player. Under this product, company offers iPod Nano, iPod shuffle, iPod touch etc.
Watches offered by company helps an individual in keeping a track of fitness schedule. Another
product offered by Apple is “Apple TV” which was a big failure for company. Most popular
product of Apple is iPhone which contributes 85% profit to the company with 18% sales only.
Along with this, company offers different kinds of online services and software like iOS App
store, iCloud, Mac App store, iOS App etc. Price strategy of company is formulated according
to the rich and high class people. Company is not in favour of targeting all sections of society
due to premium quality products (Dávila, 2012). Apple company is famous for its innovative
product, due to this products offered by company are high in range. Managers in company
follows premium pricing strategy in order to meet the expectations for their customers. As the
products offered by Apple are technologically advanced, consumers never feel reluctant in
buying them. For example, in UK popularity of Apple products is very high. Market shares of
Apple was 40.8% in 2011 but in 2018 it has reached to 49.85%. This shows that people are
satisfied with the product and appreciating the innovative technology offered by company. As
people in UK have a stable job, they are living a standardised life and prefer to buy luxurious and
expensive products. This is the reason UK is a prime market for Apple products. Even after
costly rates, people are willing to buy products of company. But in case of emerging market like
China where income of overall population is not so high, products of Apple are not widely
popular. As company targets only high class people and rates product in order to that only, more
than half of the country's population feel reluctant to buy it. But the rich class in China prefer to
buy Apple products due to this immense popularity and technological advancement (De Vries,
Gensler and Leeflang, 2012).
Apple company is famous for its multiple Distribution channels due to which customers
are satisfied with their delivering services. Company has established different production plants
in UK and China to cater the demands of people desirably. For serving customers in China,
company has established a plant in Singapore. Along with china, other Asian countries are also
served by this plant. In case of UK, European plant manages all the demands. This distribution
strategy has benefited company in optimising its distribution cost. Also retailers such as AT&T,
Best Buy and WalMart are other distribution partners of company. Growth of e-commerce and
digital marketing has permitted customers to shop anytime & anywhere. This allow company to
reach those customers which were geographically distant to reach. Company adopts an
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aggressive tactics to reach its premium segment customers. Apple differentiates companies like
Sony and Nokia in terms of staff. Due to complexity in understanding about Apple products,
company hires large number of employees to guide people. For Promotion, company mainly
focus on differentiating its products form other companies in same field. Company adopts
aggressive advertising tactics in UK by using online ads, billboards, print media and TV.
Company believes that advertisement for Apple products needs to be simple and must avoid
irrelevant information (Kim and Ko, 2012). In case of UK, Apple is promoting its products by
using different promotional channels as company sees a large potential European market. For
china and other Asian nations, Apple is not focusing on Aggressive promotional tactics as
Chinese people prefer domestic products more in comparison to foreign products.
In case of Sony, Products offered by company are television, home theatre, video
camera, speakers and amplifiers, cameras, batteries and cables, smart devices and mobiles,
medical devices and financial services. DVD players, sound bars, TV and home theatre of Sony
are worldwide famous. In case of camera's, company offer camcorders, video recorders and
action cameras. Company is also pioneer in developing cell phones, wearable technology, digital
papers and tablets. In medical field, company offers medical imaging cameras, modular displays,
medical recorders and misers. PlayStations offered by Sony are market leader in gaming field.
Company also has a film production unit. In terms of Price, Sony offers products by targeting all
sections of society. Company have expensive, medium and lower priced goods to cater the
demand of all kinds of customers. Sony has adopted price skimming strategy. At first, products
of company are high in price due to advanced technology but with time, their price reduces
considerably. For example, decrease in prices boosts the sales in emerging economies like India
and China. In terms of technology, company is on second number where Apple remains at first.
For regions like US, Sony has adopted a premium pricing tactics where customers are ready to
pay high in return of standardised services. Company is aiming high class in US to sell its
expensive products (Morgan, 2012).
There are three kinds of Distribution channels which are used by Sony to promote their
products i.e. Direct sales channels, E-commerce and dealership sales channel. Usually company
uses direct same method in regions like India. Another way by which Sony company is offering
their product to customers with the help of dealers. For example, customers in US prefer to buy
products through digital media and e-commerce such as eBay, Amazon etc. But in case of India,
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people prefer to buy their products form outlets and stores rather from online websites. Company
has formulated their distribution process in respect to that only. In US, online store promises
wide potential of enhanced revenues but in case of India, situation is very different. In terms of
Promotion, Sony position its products on the basis of the quality. In terms of standardised music
related gadgets, Sony is best and is widely popular among people in US. But in India, income of
people is not very high so they prefer to buy affordable products. To promote their products,
company slash down prices and offer discounts on festive seasons, this helps them in promoting
their products in Indian market. Also, company employ famous celebrities to make their brand a
renowned name.
To analyse market in an appropriate manner, companies can use Segmentation,
targeting and positioning procedure. This process demonstrates the way in which an
organisation can compete in a specific market. In this procedure overall population is divided
into different segments, then one or two target markets are selected and at last positioning takes
place. Goal of STP is to target right customers so that organisational goals and objectives can be
achieved easily (Achrol, and Kotler, 2012). Market segmentation is the procedure of dividing
market of potential consumers in different groups and segments according to their
characteristics. These segments are divided on the basis of needs, interest and location of
company. After segmentation, targeting takes place where marketing manager of company
selects a specific segment and target it. Company can target a particular segment by making
efforts and using resources according to the desire of targeted customers. Positioning is a
powerful marketing concept. It defines where a product stands in market in comparison to
similar products offered by other companies. Good positioning strategy makes a service or
product unique and catches the attention of customers.
In case of Apple, company is going to perform STP in two different markets i.e. UK
which is a developed market and China which is an emerging market. Apple company can
segment market on the basis of psycho-graphics, demographics, belief- values and lifestyle. As
products of Apple like iPhone, Mac and iPad are expensive, for UK, company is going to
segment market on the basis of Psycho-graphics which is based on their preference, lifestyle,
attitude, personality and choice. People in UK favour standardised products and prefer to spend
money according to their lifestyle (Labrecque and Milne, 2012). For China, company can
segment people on the basis of demographics where aspects like income, education, age,
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occupation will be considered. Out of all the sections in UK, company is going to target high
class and corporate people as they prefer to purchase expensive and standardised products where
as in China, company is going to target business class people as most of the population in china
is average income. Due to this they prefer to spend upon affordable products. Business class in
China prefers to live a luxurious life and wants to maintain a high status in society. Positioning
of Apple products can be carried out through advertising and promotion. Brand identity,
elements and products offered by Apple will play a considerable role in it. For positioning Apple
products in UK, company is going to focus on product design and quality. This will be achieved
by introducing new and advanced technology. As income level of people in UK is high,
customers will willingly buy it. For positioning in China, company can advertise their products
more. Apple believe in” the less the better.” By advertising products through TV, online,
newspaper etc. Company can position appropriately in Chinese market (Castronovo and Huang,
2015).
Sony company is going to perform STP in U.S. which is a developed market and India
which is an emerging market. Market segmentation can be carried out on the basis of geography,
behaviour, demographic, psycho-graphics. For U.S., Company is going to target on the basis of
behavioural segmentation as people in this segment prefer to buy expensive and standardised
products. Due to this U.S. Market promises a good revenue earning for its expensive products. In
India, Sony can segment people on the basis of geography. People in prime location and big
cities prefers to buy expensive products where as individuals form small cities and town chooses
to buy affordable & good quality products. In US, Sony can target Rich class and students as
these two segments prefer to use new and advance technology. For India, Sony can target
average income people. Due to this sale of company will expand and more revenue will be
generated. For positioning in US and India, Sony has started a campaign” we enable you to make
your everyday extraordinary.” company is going to promote itself through social media,
newspaper, online websites etc.
Cross- culture theory helps in analysing different countries on the basis of their culture.
One of the main theory in this regard is Hofstede cultural dimension. This theory is a framework
to distinct between different nations, their dimensions and their effect on business setting. There
are six categories which define culture. These are power distance index, individualism vs
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collectivism, Uncertainty avoidance index, masculinity vs femininity, Indulgence vs Restraint,
long term and short term orientation.
Market entry modes helps an organisation in sustaining a firm position in international
market. There are different entry modes which Apple can use to penetrate into new markets
appropriately such as exporting and licensing. In exporting, manager of Apple will sell their
product to an intermediator residing in foreign market (Yadav and Pavlou, 2014). It is most
common and widely used method which will help Apple in sustaining a firm position in UK and
China market. Licensing is an agreement which permits companies in target nation the right to
sell products. Products of Apple can be sold with the help of patents, production, trademarks etc.
This will help Apple to enhance their revenues and profitability in countries like UK and china.
In case of Sony, manager of company can take advantage of Franchising and Joint venture to
expand their business operations. Franchising is a strategy where an independent owner pays a
fees to get permission of selling products of a brand. This will benefits Sony in cross-border
marketing in countries like India and US. Another market entry route which can be adopted by
Sony is joint venture. In this, concerned company can collaborate with domestic companies
where company wishes to expand. If government regulations will be followed appropriately, this
will help Sony to sustain a robust position in international markets like US and India ( Paliwoda
and Thomas, 2013).
CONCLUSION
From above mentioned report, it has been concluded that there are different marketing
strategies which helps an organisation in acquiring a firm position in international market.
Tactics like STP helps in segmenting, targeting and positioning in desired manner. There are
different market entry modes which helps an organisation in earning high revenues and profits in
international market.
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REFERENCES
Books and Journal
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Dávila, A., 2012. Latinos, Inc.: The marketing and making of a people. Univ of California Press.
De Vries, L., Gensler, S. and Leeflang, P.S., 2012. Popularity of brand posts on brand fan pages:
An investigation of the effects of social media marketing. Journal of interactive
marketing. 26(2). pp.83-91.
Kim, A. J. and Ko, E., 2012. Do social media marketing activities enhance customer equity? An
empirical study of luxury fashion brand. Journal of Business Research. 65(10). pp.1480-
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Peck, H., Christopher, M., Clark, M. and Payne, A., 2013. Relationship marketing. Routledge.
Morgan, N. A., 2012. Marketing and business performance. Journal of the Academy of
Marketing Science. 40(1). pp.102-119.
Achrol, R. S. and Kotler, P., 2012. Frontiers of the marketing paradigm in the third millennium.
Journal of the Academy of Marketing Science. 40(1). pp.35-52.
Labrecque, L. I. and Milne, G. R., 2012. Exciting red and competent blue: the importance of
color in marketing. Journal of the Academy of Marketing Science. 40(5). pp.711-727.
Castronovo, C. and Huang, L., 2012. Social media in an alternative marketing communication
model. Journal of Marketing Development and Competitiveness. 6(1). pp.117-134.
Yadav, M. S. and Pavlou, P. A., 2014. Marketing in computer-mediated environments: Research
synthesis and new directions. Journal of Marketing. 78(1). pp.20-40.
Robinson, S. R., Irmak, C. and Jayachandran, S., 2012. Choice of cause in cause-related
marketing. Journal of marketing, 76(4). pp.126-139.
Paliwoda, S. and Thomas, M., 2013. International marketing. Routledge.
Online
Apple iPhone market share. [Online]. Available
through.<https://www.statista.com/statistics/216459/global-market-share-of-apple-iphone/>
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