The Aspects Related to the Impact of Apple in the UK with Respect to the Smartphone Industry - Research Paper Example

? AN EXPLORATION OF APPLE’S DOMINANCE OF THE SMARTPHONE INDUSTRY IN UK Table of Contents Introduction 3 Research Background 4 Aims and Objectives of the Study 5 Research Questions 6 Brief Literature Review 6 Research Methodology 10 Qualitative Methodology 10 Semi-structured Interviews 10 Questionnaire Survey 11 Data Sources 11 Ethical Considerations 12 Limitations and Scope of the Study 12 Project Plan and Time Scale 12 References 15 Introduction The topic set for this research study is “An Exploration of the Apple’s Dominance of the Smartphone Industry in UK”. As the topic suggests, the present study would involve the explanation of all the aspects related to the impact of Apple in UK with respect to the Smartphone industry. The proposed research study will be designed to answer the question which states how Apple has managed to maintain its dominance in UK in the field of Smartphone. In addition to this, the other research questions will be that how the other organisations in the Smartphone industry trying to compete with Apple in UK’s market and what Apple can do to maintain its competitive advantage in the UK’s market. Apple, Inc. is an US based multinational company which was founded in the year 1976. The Smartphone industry in UK has been booming because of the continued increase in demand of Smartphone by the people in UK. Along with Samsung and Nokia, Apple is found to be dominating the UK Smartphone market (The Telegraph, 2012). According to the report of Kantar Worldpanel ComTech, the market share of Apple’s Smartphone increased by around 10% from 21% to 31% during the period of 12 weeks that ended on November 2011 (Virki, 2011).It is mainly attributed towards the release of new model of Smartphone in UK by Apple, named iPhone 4S during October 2011. However it has been argued that Apple is ranked second to the Android platform developed by Google in terms of market share in the Smartphone industry of UK (Warman, 2011). All these facts suggest that relevance of choosing Apple as the subject in this research study with special reference to the Smartphone industry in UK. Hence, this research paper aims at gaining an insight into the various strategies adopted by Apple to maintain its dominance and have sustainable competitive advantage in the Smartphone industry in UK. Research Background The proposed topic in this research study and the analysis of the findings based on the research done on the topic would provide an in-depth knowledge about the Smartphone industry in UK at present and the consumer behaviour patterns related to Smartphone products in UK. Smartphone is only a new concept in the field of mobile technology and is different from other standard mobile phones available in the market. As a result of these facts, the existing literature in this field is limited and not much research studies have been conducted till now. Hence, this research study would add to the existing literature and pave way to further research that can be done in this field. Moreover, Apple is a dominant player in the UK’s market of Smartphone products and has had its market dominance for a significant amount of time till now. It is evident from its market share in the Smartphone industry of UK which was around 31% during November 2011 (Virki, 2011). However, lot of other mobile companies are also introducing their Smartphone products in the UK’s market. This can have an effect on Apple’s market share in UK. According to the recent reports published by Kantar Worldpanel ComTech, Apple has fallen behind Google in terms of market share in the UK Smartphone industry. Android operating system installed in the Google Smartphone is being preferred by the consumers in UK more than Apple Smartphone (Arthur, 2012a). However, Android is divided amongst various brands like Samsung, HTC, Motorola, etc. Hence Apple iPhones which is the single branded Smartphone is the most used brand by the consumers in UK. Moreover, with respect to customer satisfaction, Apple is found to have the highest level of customer satisfaction and is closely followed by Samsung (Arthur, 2012b). Hence this research study would try to explore the details behind the success of Apple in the Smartphone industry of UK. Moreover, this research study would provide a better understanding about the consumer behaviour patterns found in UK in relation to the Smartphone industry. This research study would have the potential to help in the research studies that could be done related to future developments in Smartphone. Aims and Objectives of the Study The primary objective of this research study is to have a detailed understanding of the market dominance of Apple in UK’s Smartphone industry. Smartphone is a new concept in the field of mobile communications and have certain unique characteristics which are different from that of standardized mobile phones that were available in the market. Since the concept is new and only a few of the mobile companies have launched their Smartphone products in UK’s market, very little research has been done in this field. This research study will thus aim at gaining an in-depth knowledge of the Smartphone industry. The research study will try to explore all the existing relevant literature based on research studies in Smartphone and will adopt a research methodology to have understanding about the consumer behaviours related to their Smartphone use in UK. In addition to this, the present study will have its primary focus on Apple and its Smartphone products that have been launched in UK. Hence, two objectives have been set for this research study. First of all, this research study will be designed to have in-depth knowledge about Apple’s dominance in the UK Smartphone industry and how it has managed to do so. The core competencies of Apple in the field of Smartphone and its existing market strategies would be identified in this research study. The second objective of this research study would be to identify the developments in the field of Smartphone and the major competitors of Apple in the Smartphone industry in UK who have the potential to surpass Apple to gain dominance in the market through higher market share and market size in the country. Thus the research study will focus and aim at exploring all the facts behind the market dominance of Apple in the Smartphone industry of UK. Research Questions Question 1: How Apple has managed to sustain its dominance in the UK Smartphone industry? Question 2: What are the potential competitive threats of Apple in UK? Brief Literature Review This research study will take help of the existing relevant literatures in the field of Smartphone and the various theoretical studies related to formulation of market strategies by different organisations to have a competitive advantage in the market. The literature review will first present a brief overview of the present Smartphone industry in UK. The concept of Smartphone is new to the mobile industry and consumers, especially in UK are found to be having a preference of Smartphone over standard phones. Hence not many studies have been undertaken in the field of Smartphone industry yet. According to Miller (2012), Smartphone will go through a rapid change and development, incorporating many new features which are not present today. Hence, it provides an opportunity for companies like Apple to explore the opportunities available for the up-gradation of their existing Smartphone to attract more people and increase its market share. According to Barnes, and Scornavacca (2004), mobile phones prove to be an useful product for the consumers. It has gained importance globally in a relatively short time period. In today's world mobile phones are found to play a significant role in most of the consumer's lives. Mobile phones are no longer limited to being only a communicating device which can help people communicate with their near and dear ones. They are now supposed to be the resemblance of the individuality and personality of people using mobile phones. From the marketers’ point of view, mobile phones provide a good opportunity to reach out to greater number of consumers because of the increasing rate of use of mobile phones by people worldwide. According to Persaud, and Azhar (2012), the use of Smartphone by the consumers has been increasing at an alarming rate and would continue to do so in the forthcoming years as well. Most of the marketing strategies developed and employed by different organisations are meant for creating competitive advantage in the market. Hunt and Arnett (2004) suggests that market segmentation is one of the key market strategy employed by most of the organisation and this market segmentation strategy supplemented with resource-advantage (R-A) theory can help any organisation to have a superior financial performance and create a competitive advantage. Apple is known for its innovative products and thus a successful segmentation strategy along with a competitive advertising strategy can help the company compete in the market in UK. R-A theory is considered to be a positive theory related to formulation of marketing strategies by different organisations. This theory has the capability to provide a foundation base theoretically for creating marketing strategies which are normative in nature like, market segmentation and relationship marketing. Market segment strategy is used in common parlance as a tactical strategy employed by managers of companies to identify certain groups of people who have the potential to become prospective customers of the companies based on their wants, needs, preferences and tastes for a product. However, if we look at the broader perspective, segmentation strategy can be viewed as a strategic process which can serve various purposes of an organisation. Segmentation strategy process can be utilized by the companies for various purposes as defined by Hunt and Arnett (2004) and are given below: Identification of factors on the basis of which segmentation will be done Those factors or bases identified will further help in identification of potential market segments Developing a segment portfolio or combination of segments that will serve as strategic alternatives for the organisation. Each of the strategic alternatives identified would require ascertaining of the relevant resources that are required for the alternatives. Assessment of the resources that is available with the organisation. Based on the assessment, the best alternative is required to be selected by the organisation which would help in the identification of a particular market segment or segments. The company needs to ensure the availability of resources necessary for the target segment(s). Effective positioning strategies or plans are required to be formulated by the company to facilitate its services or product offerings in the targeted segment (s). Development of marketing mix which would be suitable for each of the segments that would be targeted by the organisation. Nguyen and Shi (2006) have incorporated the market size and market share dynamics in their study to present their view regarding competitive advertising strategies that can be employed by an organisation. Thus the theoretical model related to Smartphone will be utilized to suggest ways through which Apple can attain sustainable competitive advantage for a long term in the Smartphone industry in UK. Market size dynamics have been described through a well known model named as Bass diffusion process (Bass, 1969). Excluding the Bass process, some of the other available literature on diffusion models includes research studies conducted by Erickson (2003) and Dockner and Jorgensen (1992). Apple is a multinational US based company which has gained dominance in the UK’s market related to Smartphone industry. Apple has managed to sustain its competitive advantage in the market for past many years in UK. The customers in UK seem to be more satisfied with the Smartphone products manufactured by Apple. However, with the increasing number of international companies launching its Smartphone products in the UK’s market, the competition has increased. Apple is known for its innovative products and the Smartphone are no exception. The consumers in UK have a greater demand of the Smartphone manufactured by Apple. Hence Apple has been successful in employing its marketing strategies in the field of Smartphone in the market of UK and it is evident from its high market share in the country. According to Juniper Research, it has been forecasted that the sales related to premium Smartphone is expected to triple by the end of 2016 (Hill, 2011). This fact suggests that the Smartphone market is expected to boom in the upcoming years and it is a great opportunity for companies like Apple to increase its market share in UK and sustain its dominance in the market as well. Hence, the literature review will be utilized to answer research question of this study regarding how Apple has managed to maintain its competitive advantage in the Smartphone industry in UK. This research study will try to discover the uniqueness of Smartphone which makes it attractive to the consumers. However, the scope of this research study is limited to studies related to Smartphone industry and the Smartphone products offered by Apple. Moreover, the research would be conducted with respect to UK only and might not relate to facts and figures corresponding to other nations of the world. Research Methodology Qualitative Methodology Qualitative research methodology would be utilized in this study, firstly because the research design should be selected in such a way that it corresponds to the research questions set for this study and thus paves way to all the procedures of data collection. Quantitative studies are mainly utilized for employing rigorous testing procedures on the existing theories. It helps in the measurement and analysis of various relationships that exist between the variables. Hence the findings from such type of research study would be more reliable because of the large samples used. However all the empirical studies are mostly criticised of not corresponding to the correct attitudes or feelings of the people. Hence quantitative is not that appropriate for studies which relates to knowing about human behaviour. Knowing about the facts related to Apple’s market dominance in the Smartphone industry of UK would require the knowledge of consumer behaviour pattern. Hence it is justified to use qualitative research methodology in this research study. Semi-structured Interviews The major research method that would be applied in this research study is interviews. This type of approach is considered to be as one of the most important and powerful tools to facilitate data collection in certain complex situations. It helps to gain an in-depth knowledge as compared to other procedures of collecting data. Semi-structured interviews would be conducted in this research study taking the help of questionnaires which would include questions that are mostly open ended. Open ended questions have the advantage of allowing the respondents to present their views about an issue in their own ways. Hence it would help in the collection of information which are meaningful for the study and are unique in nature. The replies of the respondents could be such which are unanticipated by the researcher. Moreover semi-structured interviews are characterised by providing a high level of flexibility for the respondents. The participants could even ask questions in cases when any kind of uncertainty arises. Questionnaire Survey Questionnaire survey would also be used as a technique to obtain data for analysis in this research study. It can be helpful for understanding the consumer behaviour patterns related to Smartphone product usage by people in UK. The questions included in the questionnaire would be mostly closed ended type because the respondents of the survey would find it easier to answer to the questions and it would take less time for them to answer them as well. This would help in collecting more responses in shorter period of time. The responses would then be analysed to find out consumer preferences regarding Smartphone used by them. This in turn would help to achieve the aims and objectives of this research study. Data Sources For conducting the semi-structured interviews, around 5 to 10 top management officials of Apple and its competitors like Samsung, Nokia and Google would be interviewed. They would be contacted through e-mail and interview schedule would be made available to them. Then with their consent, interviews would be scheduled with them. Next regarding questionnaire survey, around 200 respondents would be selected using random sampling technique. The respondents would mostly be the consumers who are already using Smartphone in UK. The questionnaire survey would be an online survey where the respondent would be contacted over e-mail or through various social media websites. Ethical Considerations This research study would be conducted keeping all the ethical issues related to collection of data for the purpose of research. The interview participants would be informed from all aspects regarding their involvement in this research study. They will be facilitated with the research proposal of this study along with the interview schedule in advance. Moreover in the other research methodology of conducting a questionnaire survey, it would involve voluntary participation of respondents. Apart from all these all the ethical norms as existent in the country would be complied with while conducting this research study. Limitations and Scope of the Study The research study would present a significant scope for conducting further research in areas related to Smartphone industry in UK and marketing strategies that can be implemented by organisations to have a competitive advantage in the market. However it has its limitations too. The research study would be confined to UK only and the conclusions drawn from findings of the research may not relate to the characteristics of other parts of the world. Moreover, mostly qualitative study would be conducted in this study. Hence it is not possible to have accurate results based on such research. However, this research study can be helpful for various organisations like Apple to formulate its marketing strategies and since not much research has been conducted in the field of Smartphone, its research scope in future is quite significant. Project Plan and Time Scale In order to complete this Master Thesis, it is necessary to have a proper planning about how to go on with the different tasks related to the project. First of all, it will take a month’s time to formulate and revise the research questions that this research study will try to answer. Various factors like the relevance of the questions with the research topic and how it can add to the existing research studies are needed to be considered while formulating the research questions. Once the research questions are known, the research aims and objectives will be formulated and by the end of the second month I will start writing on the paper. Next, it will take around two months time to collect all the existing literature reviews from different databases and other secondary research sources. It is important to look for the relevance of the previous works by different authors with that of the current research study. Writing part of the introduction and literature review chapters will be over by the end of fifth month. Next, according to the research methodology of the paper, it will take around two months more to collect all the primary data using questionnaire surveys and interviews conducted for the purpose. Next by the end of eighth month the writing part up to research methodology and findings part will be over. Thereafter, the analysis and conclusion part will be over by the end of ninth month. The complete dissertation will be ready after ten months which will be reviewed time and again to make all the necessary changes required for the purpose of completing this Master’s Project. The Gantt chart or the timescale showing the main tasks that would be done throughout the year to complete the final dissertation is shown in Figure – 1. Figure – 1 Gantt chart   Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12                           Formulation and Revision of Research Questions                         Formulation of Research Aim and Objectives                         Collection of Data from Secondary Sources                         Writing the introduction and literature review chapters                         Collection of primary data using questionnaires and interviews                         Writing the research methodology and findings of the study                         Analysis and conclusion                         Complete writing of the dissertation                         Review and final submission                         References Arthur, C., 2012a. Android is Most-Used Smartphone OS in UK, Overtaking Apple, Data Shows. The Guardian. [online] Available at: [Accessed 31 August 2012]. Arthur, C., 2012b. Android Retains Lead over iPhone as UK Smartphone Ferment Goes On. The Guardian. [online] Available at: [Accessed 31 August 2012]. Barnes, S. J., and Scornavacca, E., 2004, Mobile marketing: the role of permission and acceptance. International Journal of Mobile Communications, 2(2), pp. 128-39. Bass, F. M., 1969. A New Product Growth Model for Consumer Durables. Management Science, 15, pp. 215-227. Dockner, E., Jorgensen, S., 1992. New Product Advertising in a Dynamic Oligopoly. Marheting Science, 7(4), pp. 459-473. Erickson, G. M., 2003. Dynamic Model of Advertising Competition. 2nd ed. Massachusetts: Kluwer Academic Publishers. Hill, J., 2011. Juniper Research Predicts Premium Smartphone Sales to Triple by 2016. Satellite Today. [online] Available at: [Accessed 23 August 2012]. Hunt, S. D., and Arnett, D. B., 2004. Market Segmentation Strategy, Competitive Advantage, and Public Policy: Grounding Segmentation Strategy in Resource-Advantage Theory. Australasian Marketing Journal, 12(1), pp. 7-25. Miller, G., 2012. The Smartphone Psychology Manifesto. Perspectives on Psychological Science, 7(3), pp. 221-237. Nguyen, D., and Shi, L., 2006. Competitive Advertising Strategies and Market-Size Dynamics: A Research Note on Theory and Evidence. Management Science, 52(6), pp. 965-973. Persaud, A., and Azhar, I., 2012. Innovative Mobile Marketing via Smartphones: Are Consumers Ready? Marketing Intelligence & Planning, 30(4), pp. 418 – 443. The Telegraph, 2012. Android extends lead over Apple iPhone. The Telegraph. [online] Available at: [Accessed 23 August 2012]. Virki, T., 2011. New iPhone? No Thanks, Say Cash-Conscious Europeans. Reuters. [online] Available at: [Accessed 23 August 2012]. Warman, M., 2011. iPhone 4S ‘Achieves the Impossible’ to get Apple Market Share Growing Again. The Telegraph. [online] Available at: [Accessed 31 August 2012]. Read More