MKTG116 Assignment 2: Apple's Approach to Customer Segmentation

This assignment delves into Apple's customer segmentation approach, specifically focusing on the iPhone product line. It examines the bases for segmentation, including geographic, demographic, psychographic, benefit, and usage-rate segmentation, providing detailed explanations and descriptions for each sub-base. The analysis highlights Apple's target audience, considering factors like age, gender, income, and lifestyle. The assignment further explores consumer buying behavior, discussing the influence of cultural, psychological, and social factors on purchasing decisions, emphasizing brand loyalty and peer pressure. Additionally, it explains the role of Customer Relationship Management (CRM) in Apple's strategy, detailing the company's CRM practices and their impact on customer loyalty and satisfaction. The assignment references key academic sources to support its claims and provides a comprehensive overview of Apple's marketing strategies.

1Running head: APPLE’S APPROACH TO CUSTOMER SEGMENTATION
APPLE’S APPROACH TO CUSTOMER SEGMENTATION
Name of the Student
Name of the University
Author note

2APPLE’S APPROACH TO CUSTOMER SEGMENTATION
Answer 1
Part A
For the Apple Company a product line is chosen, that is the iPhones.
Bases for Segmentation Sub-Bases Explanation/Description
Geographic Region of the country or
world, climate, population
density?
The main country in which
the company operates is
USA, and other urban
regions of the world.
Demographic Age Segmentation: Age
group/ generation?
20-55
Gender Segmentation:
Traditional or Modern?
Gender Neutral
Income Segmentation: Low,
middle or high income?
High income earners
Ethnic Segmentation:
Multicultural or targeted?
Targeted
Family Life-Cycle
Segmentation: Young,
middle-aged or older?
Single, divorced or married?
Children or no children?
Mainly for young and middle
age people.
Psychographic Personality Segmentation:
Traits, attitudes and habits?
People who are ambitious
and determined.
Motives Segmentation: Motivated by rational.

3APPLE’S APPROACH TO CUSTOMER SEGMENTATION
Emotional or rational?
Lifestyle Segmentation:
Socioeconomic
characteristics, beliefs, how
they spend their time?
They spend their time mainly
working and doing leisurely
activities.
Benefit Segmentation What benefits do they seek
to gain from the product?
To provide comfort in use
and cater to their specific
needs. Sense of achievement.
Speed of service, features
and
Usage-Rate Segmentation Former, potential, first time,
light or irregular, medium or
heavy user?
Hard core loyal people to the
brand and the people
switching over from a
different brand.
Bases for Segmentation
 The demographics of the consumers on the basis of age, gender, their income
level and their family cycle (Al-Refaie, & Bata, 2016).
 The company also divides the market into psychographic, geography and how
they want; they want the consumers to perceive the brand and what usage they
provide to the consumers (Weinstein, & Winston, 2016).
 The company also segments the consumers based on the usage and the need
that the product fulfils.

4APPLE’S APPROACH TO CUSTOMER SEGMENTATION
Part B
Social Butterfly: These people are extremely social and easy going. They are dynamic,
networking and have a have gregarious personality.
Brand Devotee: These people are extremely devoted to a brand and do not like to switch to
another brand. The main customer segment for Apple is the people that are loyal to the brand.
Answer 2
The culture, psychological and social factors all affect the purchasing decision of the
consumers. The consumers that buy the product are from the high-end segment. They are
loyal to the brand. These factors are important in the purchasing decision that a consumers
makes, as the social pressure and the need of the consumers to fit in makes them want to
purchase the product (Rani, 2014). Buying an iPhone makes the consumer have a sense of
belonging in the higher strata of the society. The consumers often buy the product under peer
pressure. Buying the iPhone also is impacted by the psychological behaviours as the
consumer after buying the product feels good and content that helps the consumer in feeling
better about himself. The culture in terms of the development of the country also has an effect
on the purchasing power of the consumers (Ramya & Ali, 2016). The more the developed
nation the more the purchasing power of the people and thus they can buy iPhones. The
buying behaviour of the consumer can highly be influenced by these factors.
Answer 3
CRM can be defined as the Customer Relationship Managemnet of a company that
helps in understanding the company’s relationship with the consumers. It is a technology that
can be used to manage the interaction that a company has with its consumers (Kaur, 2016).
CRM can help the company in being connected to the consumers and having a streamline
process that can help in having loyal consumers and in gaining more profits. Apple is known

5APPLE’S APPROACH TO CUSTOMER SEGMENTATION
for having a great CRM with its customers mainly for the iPhone. The company uses many
CRM practices like attending to the needs of the consumers, sending emails to the consumers
to gain feedback when they use the company’s services (Lescop, & Lescop, 2016). The
company focuses on making it an experience for the consumers and not just a purchase. The
company focuses on solving the needs of the consumers and the wants that they also did not
know about. The company offers the complete solution to a consumer and offers after sales
service for the consumer to feel satisfied about the purchase of the product.
The purpose of Apple using CRM in their retail is to encourage the customers to have
a lifetime relationship with the company and the product. A good CRM can lead to a
company in having loyal customers and apple has mastered this technique for their iPhones.
Apple has many steps of feedback loops created for knowing where they can improve in
customer satisfaction and have more satisfied and happy consumers.

6APPLE’S APPROACH TO CUSTOMER SEGMENTATION
References
Al-Refaie, A., & Bata, N. (2016). Market Segmentation and Conjoint Analysis for Apple
Family Design. International Journal of Economics and Management Engineering, 10(4),
1138-1142.
Weinstein, A., & Winston, W. (2016). Defining your market: winning strategies for high-
tech, industrial, and service firms. Routledge.
Kaur, J. (2016). Customer Relationship Management: A Study of CRM Policies of Different
Companies. Global Journal of Finance and Management, 8(2), 153-159.
Lescop, D., & Lescop, E. (2016). The Apple Twist. DigiWorld Economic Journal, (102), 13.
Rani, P. (2014). Factors influencing consumer behaviour. International journal of current
research and academic review, 2(9), 52-61.
Ramya, N., & Ali, M. (2016). Factors affecting consumer buying behavior. International
journal of applied research, 2(10), 76-80.