Marketing Fundamentals Report: An In-Depth Analysis of Apple Inc.

This report offers a comprehensive marketing analysis of Apple Inc., delving into its background, situational analysis, and external environmental forces. It presents a SWOT analysis, competitive comparisons with Samsung and Sony, and an examination of consumer buyer characteristics. The report ...Read More

MARKETING
FUNDAMENTALS

1
Contents
INTRODUCTION.................................................................................................................................2
Back ground of the company.................................................................................................................2
Situational Analysis...............................................................................................................................3
External forces and changes in the marketing....................................................................................3
SWOT analysis..................................................................................................................................4
Competitive Analysis............................................................................................................................5
Consumer Buyer Characteristics...........................................................................................................7
Target market, Positioning and Branding analysis.................................................................................8
Segmentation.....................................................................................................................................8
Marketing mix of Apple........................................................................................................................8
Product strategy.................................................................................................................................8
Pricing...............................................................................................................................................9
Placement strategy.............................................................................................................................9
Marketing/distribution channel strategy............................................................................................9
Promotion strategy.............................................................................................................................9
Extended mix...................................................................................................................................10
CONCLUSION...................................................................................................................................10
REFERENCES....................................................................................................................................11
INTRODUCTION
In the modern era of business, it has become essential for the organisations to make sure that
they have an effective marketing plan for their business (Agrawal, Atasu & Van Ittersum,
2015). Strategies related to marketing must be based on the analysis of the environment
around the business of the firm. Both competitor and situational analysis needs to be so as to
have complete idea about the performance of the firm’s own product. It is also crucial for the

2
firm to make sure that they have a clear understanding of the consumer’s buyer
characteristics. Strategies like targeting, positioning and branding as well as marketing mix
can help in increasing the effectiveness of the marketing plan. Apple Inc. is one of the biggest
technology firms that are operational in all around the world. This report highlights the
different aspects of marketing related to Apple Inc. The environmental analysis along with
the competitor’s product comparison has been done. It also provides strategies of the
company like the STP and marketing mix. Apart from this buying behaviour of the
consumers has been showcased.
Back ground of the company
Apple is one of largest technological giants that are present in the Industry. It was established
back in the year 1976. It deals in the business of designing, developing and selling of
computer software, consumer electronics and other online services (Backer, 2013). In many
of the products that are produced by this company, IPhone has been selected for the review as
it has been one of the major products of the company and has played a major role in its
success.
Situational Analysis
External forces and changes in the marketing
There are many types of changes that are going on in the marketing environment. Some of
these changes that are having impact on the both consumers and marketer’s behaviour is as
follows:
 Competition: There are many bigger firms present in the industry and they are posing
threat to market growth of the company. This has forced the marketers of Apple to
rethink about their marketing plans (Bergvall-Kåreborn & Howcroft, 2013). On the
other hand it has empowered consumers, as they have lot of options to choose from.
 Changing trends: Since the trends in the market are changing at very fast speed and
hence it has become difficult for the company to make alterations as per this changing
trend. While consumers have larger options to make decisions as they can select
product as per their requirement.
Apart from this there are many forces that are directly or indirectly impacting on the
environment of the firm. They are as follows:

3
 Political: In many regions of the world political instabilities have been noticed. The
changing policies and tax rules in various parts of the world has made business
tougher for the multinational firms like Apple Inc. Governments have become very
strict on the ways in which technology industry is performing as they have close
watch on the non-ethical practices present in the industry (Cunningham, 2014).
 Economics: Another crucial factor that is influencing the marketing environment is
the changing global economic condition. In many region of the world economic
instabilities have been noticed. The downfall of the European market after 2009 and
the slow growth of the American economy has made the successful marketing
processes bit difficult.
 Social: Society has emerged with new set of demands. With the amount of options
available with them, it has become crucial for Apple to make sure that they have made
innovations in the products so as to have a successful marketing campaign.
 Technological: Both the technology with which this company is dealing as well as the
production technology has changed a lot in the past few years. In almost every six
months technology gets advanced by two times than what was present previously.
Marketing has also taken digital means and making advancements in the technology is
a costly affair hence they need to have proper selection of technology so as to have
edge in the market (Love, 2016).
 Legal: A great sort of changes has been noticed in the legal norms of business. Firm
like Apple which is has to deal with such a wide range of laws in different regions of
the world has to comply with all these more carefully. This is applicable to marketing
also where the false marketing can lead a company to facing of serious legal issues.
SWOT analysis
It is also crucial that a company understands its internal environment as they have the same
impact on the business of the firm as the external factor had. SWOT analysis of Apple:
Strengths
 Highly talented workforce especially in the department of research.
 Higher brand name in the market.
 Many disruptive innovations in the past.
 Operations in many parts of the world having such an excellent supply chain
management (Gershon, 2013).

4
 Strong leadership and quick decision making process.
Weaknesses
 In recent few years they have faced problems related to leadership decision making.
 Lower investment in direct marketing.
 Negative approach towards the masses population in the developing countries where
people demand of low cost products (Foreman, 2010).
 Limited distribution network.
Opportunities
 They have higher chances to penetrate in the developing markets like India, Brazil
where the per capita income of the country is increasing.
 They have opportunities related to distribution network expansion.
 Generation of new product lines.
Threats
 Many of the companies have imitated the product of Apple and now they are posing
threat to the business of Apple Inc.
 They are facing competition from many technology players and their marketing
campaigns have been aggressive.
 Changing operational demands at the production units especially related to human
resource management.
Competitive Analysis
It has become highly crucial for the firm like Apple Inc. which is facing tough competition
from national and international players to make competitive evaluation (Interbrand, 2013).
This competition is more intense in Mobile phone Industry where the Apple’s IPhone is
facing competition from the products of Samsung and SONY (Al-Laham & Huth, 2011).
Samsung’s note series and Sony mobiles have been a great challenge for the Apple’s IPhone
business. A comparative review between the products of the companies on the basis of
marketing mixes has been done.
Element IPhone Sony Mobiles Samsung phones
Product Product range includes They also have the Products include various

5
various versions of
IPhone. They are
known for their
innovative products as
well as the simplicity in
design. Their operation
system is IoS which is
highly smooth.
Processing speed of
their phone is very
high. It is also having
higher number of
exclusive Apps.
different ranges of
mobile phone working on
various technologies.
They are also known to
have different kind of
innovations in their
products. Gaming
consoles in their product
have helped them in
attracting larger
consumer base.
smart phone series like
Samsung Galaxy series.
Quality of their products
is very high and has a
very simple and friendly
interface. Its product
comes with one year
warranty. Most of its
products work on Android
operating system.
Price They price their
products on higher side.
They also have adopted
skimming pricing
strategy. Their premium
prices have become a
matter of status for
people. It adds to its
brand value.
They have adopted three
tiered pricing strategy.
This helps them in
making appeal to three
market segments namely
the lower economy class,
the middle market
segment and the higher
economy segment. This
company also like the
other companies have
adopted skimming
pricing strategy.
They have incorporated
Skimming prices and try
to get a high value in the
start before rivals can
catch them. Once the
phone gets older they
immediately drop the
prices.
Place Due to their premium
pricing strategy their
stores are generally
found in ‘A, grade
cities. They also sell
their products through
online mediums like
their sites and other e-
They have an excellent
distribution network so
as to make full benefit of
the market. In many
countries they have
adopted distribution
channel that is three
tiered involving
They have two kinds of
segment i.e. modern retail
and distributors and other
Sales and service Dealer.
Here the sales and service
dealers are involved in
corporate sales while
modern retailers of

6
commerce markets. manufacturers, retailers
and finally consumers.
Apart from this they have
also taken use of digital
mediums for increasing
their product sale. E-
commerce market is one
of the best places for
their product sale.
Samsung are very large in
numbers. They have also
taken online sites for
conducting their business
Promotion They do not believe in
promotion through the
traditional marketing
processes. They have
taken use of exchange
offers to lure the
consumers. They highly
believe on the
launching programs that
help in creating buzz in
the market.
They extensively believe
on the promotional
campaigns. They usually
promote their
innovations so as to
influence the target
section. Television and
online advertisements are
highly focused upon.
They have also made so
many brand
Ambassadors for their
products in different
parts of the world.
This company believes in
multiple type of
marketing campaigns
where they take use of
several mediums like
online space, tradition
methodologies like
hoardings, paper
advertisements etc. It also
offers discount strategy. It
has used its brand name in
TV advertisements so as
to attract potential
consumers towards their
business.
Consumer Buyer Characteristics
Consumer’s behaviour towards the product of Apple Inc. is very positive. Their consumers
have a faith in the company. They have a confidence that they are buying quality product.
They understand buying Apple’s product is a matter of prestige. This helps the company to
increase their product sale as they have higher numbers of loyal consumers.
In considering of situational factor it is to be understood that the company spends a lot in the
quality of their stores. This kind of facilities attracts the people towards their stores.

7
Presentation changes the buying behaviour of the person. Psychological factors works very
effectively for the Apple’s consumers as they understand buying of Apple’s product to be
something that is more of a matter of prestige (Bajarin, 2017). The buzz in the market about
the Apple’s new launches acts as a motivator for their purchasing decision making. On the
other hand the socio-cultural aspect also impact on the purchasing decision making of the
consumers. This can understand by the fact that the way in which a person wants to look in
the society gets reflected back in their decision making. Person’s social background plays a
very large influence on the buying behaviour of the consumers. Apple’s product generally
attracts the people who are rich or have some status in the society.
Target market, Positioning and Branding analysis
Segmentation
There are various criteria’s according to which Apple does its market segmentation.
 Behavioural segmentation: There are large numbers of loyal customers present with
Apple. So this segmentation includes hardcore loyals and switchers.
 Geographical: They have also segmented people according to the geographical area.
This includes people in the international region or in density wise they have chosen
urban region (Browning, Russolillo & Vascellaro, 2012).
 Demographic: They have segmented people according to the age (20-45 years),
Gender (Male and female) and Life cycle stage (Bachelors and newly married),
Income ( Higher and middle waged workers).
 Psychographic: Their segmentation includes people belonging from middle and upper
class. They have also segmented on the basis of lifestyle like the Aspirers and
Succeeder.
 Targeting: The segments that Apple has made for itself acts a target section for them.
They develop their product keeping these targeted people in mind (Heracleous, 2013).
Their targeted segments include appreciating quality, design, performance of
technology services and products. Targeted segment comprises of individuals who are
willing to pay extra for the high quality technology products and services.
 Positioning: They have positioned their products as a premium product. They have
placed themselves as premium brand offering high quality services and products. This
has helped them in their marketing program.

8
Marketing mix of Apple
Product strategy
They offer many kinds of products that are capable of fulfilling the demands of their target
segment. They have adopted product development strategy where their highly innovative
culture as helped them in making of the products according to the demands of the market.
Three levels of products includes the core products that is capable of attracting the
consumers; actual product which includes features and capabilities, durability, design and the
final level is augmented product which focuses on support aspects (Hosni & Lancon, 2011).
For IPhone their core product is to keep in contact with one and at the same time being on
call. The actual product includes simple design and logo of Apple on back. The augmented
product includes its service called ‘Genius Bar’.
They aim to bring best experience to their consumers. Its product mix of IPhone includes
width of 2.79 inches and depth of 0.30 inches.
Pricing
They take use of skimming product strategy where at the time of the product launch the
prices of the product is on higher side but as it gets older with time the prices falls down
sharply. Apart from this they have also adopted premium pricing strategy that helps them in
maintaining their brand image in the minds of consumers (Johnson, Li, Phan, Singer & Trinh,
2012). Their pricing strategy is not based on the competitor’s price or they do not price so as
to win price war they set their own price based on the value that the product is offering to its
consumers.
Placement strategy
Marketing/distribution channel strategy
Apple takes use of direct selling strategy for reaching to the clients directly with the help of
their stores. Apple never provides discounts through its direct channel (Mallin & Finkle,
2011). Apple keeps its reseller pricing strategy stable and it is illegal to set dealer pricing.
They are also offering their products through online storefront where they use minimal
signage and crystal clear messaging.
Apple is utilising its distribution strategy in such a manner that they are using multiple
channels so as to cover larger part of the market (Montgomerie & Roscoe, 2013). This

9
includes direct and indirect sales and different distribution channels for different products. It
helps them lowering the cost of channel and providing more customised selling.
Promotion strategy
Advertisements: Apple does not believe in advertisements using traditional and other
mediums.
 Personal selling: They extensively use personal selling. For this they have trained and
knowledgeable employees who have complete information about the product and
customer service.
 Sales promotions: Apple never offers discount coupons but they offer gift cards, free
delivery options for their online customers.
 Public relations: They take use of their Genius tool for maintaining healthy relations
with their consumers. They conduct their launch programs that would help them in
creating buzz in the market and they take reviews from their clients (Hoog &
Strzempka, 2011).
 Direct marketing: They launch various kinds of direct marketing campaign that
includes wide range of actions like visiting Apple.Com site or making product
purchase online.
 Digital: They have a very good digital campaign where they promote their
competencies and good features of their new products (Dudovskiy, 2018).
 Others: Apart from this they have placed their product at premium level. They do not
believe in sponsorship or co-branding.
Extended mix
 People: They have employed a highly skilled workforce that is capable of doing
extensive research and hence producing quality products (Tjosep, 2015).
 Process: They have adopted the process that is according to the strategies they have
made and the demand of the market.
 Physical evidence: They produce products that are tangible and are according to the
promises hey have made to their clients.
 Partnership: They have had partnerships with many smaller and regional firms that
help them in extending their market reach (Javed, 2013).

10
CONCLUSION
From the above report it can be concluded that Apple is one of the technological giants and
are performing in a very good manner. The environment of their business is having impact on
their future business. They have enough of competencies so as to face the competition in the
market. Companies like Samsung and Sony is giving them hard competition. They have a
very loyal customer base that is influencing buyer’s purchase decision making. They have
taken use of STP and marketing mix in a proper way so as to have competitive edge over the
competitors.
REFERENCES
Agrawal, V. V., Atasu, A., & Van Ittersum, K. (2015). Remanufacturing, third-party
competition, and consumers' perceived value of new products. Management
Science, 61(1), 60-72.
Al-Laham, A., & Huth, S. (2011). Strategic Repositioning of Apple Inc. In Fallstudien zum
Internationalen Management(pp. 641-664). Gabler Verlag, Wiesbaden.

11
Backer, L. C. (2013). Transnational Corporations' Outward Expression of Inward Self-
Constitution: The Enforcement of Human Rights by Apple, Inc. Indiana Journal of
Global Legal Studies, 20(2), 805-879.
Bajarin, T. (2017) Retrieved from: http://time.com/4723389/apple-strategy-iphone-ipad-
apple-tv/
Bergvall-Kåreborn, B., & Howcroft, D. (2013, December). The Apple business model:
Crowdsourcing mobile applications. In Accounting Forum (Vol. 37, No. 4, pp. 280-
289). Elsevier.
Browning, E. S., Russolillo, S., & Vascellaro, J. (2012). Apple Now Biggest-Ever US
Company. Wall Street Journal, 21.
Cunningham, A (2014) Retrieved from: https://arstechnica.com/gadgets/2014/01/apple-
breaks-revenue-iphone-and-ipad-records-in-q1-of-2014/
Dudovskiy, J., (2018) Retrieved from: https://research-methodology.net/apple-segmentation-
targeting-and-positioning/
Foreman, W. (2010) Retrieved from: https://www.huffingtonpost.com/2010/05/25/foxconn-
suffers-10th-deat_n_588524.html
Gershon, R. A. (2013). Digital media innovation and the Apple iPad: Three perspectives on
the future of computer tablets and news delivery. Journal of Media Business
Studies, 10(1), 41-61.
Heracleous, L. (2013). Quantum strategy at apple inc. Organizational Dynamics, 42(2), 92-
99.
Hoog, A., & Strzempka, K. (2011). iPhone and iOS forensics: Investigation, analysis and
mobile security for Apple iPhone, iPad and iOS devices. Elsevier.
Hosni, W. & Lancon, F., (2011). Retrieved from: http://agriportal.gov.sy/public/dwnld-
files/working_papers/en/48_apple-Competitiveness_en.pdf
Interbrand, (2013) Retrieved from:
http://interbrand.com/best-brands/best-global-brands/previous-years/2013/

12
Javed, S., (2013) Retrieved from: http://wwwappleinc.blogspot.in/2013/11/personal-selling-
and-sales-management.html
Johnson, K., Li, Y., Phan, H., Singer, J., & Trinh, H. (2012). The Innovative Success that is
Apple, Inc.
Love, J. (2016) Retrieved from: https://www.reuters.com/article/us-apple-china-
idUSKCN0Y404W
Mallin, M. L., & Finkle, T. A. (2011). Apple Inc.: product portfolio analysis. Journal of the
International Academy for Case Studies, 17(7), 63.
Montgomerie, J., & Roscoe, S. (2013, December). Owning the consumer—Getting to the
core of the Apple business model. In Accounting Forum (Vol. 37, No. 4, pp. 290-
299). Elsevier.
Tjosep, (2015) Retrieved from: https://mpk732.wordpress.com/2015/05/16/apples-sales-and-
channel-strategy-key-to-its-success/