Success of the iPod - Research Proposal Example

Business research: Success of the iPod Apple Inc. has long been known for churning out interesting products ever since it first began to produce personal computers on a commercial scale. Its history has witnessed huge ups and turns and the company has not only survived a potential extinction, but has also managed to silence all industry pundits who had written it off. A number of products released over the past decade, including the iPod and the recent iPhone, have contributed immensely to the company’s upheaval. Despite the rich array of products that apple now offers in its portfolio, the one gadget that steals the show and is considered to have paved the turning point for the company is the iPod. This miniature music player, which can easily fit into the palm of one’s hand, is so sleek and easy to use that users can virtually listen to their favorite song by downloading from the internet in a matter of minutes. In fact, the popularity of the product is evident from its worldwide sales of over 200 million units as of September 2009. This means more than 1 out of every 30 people on this planet now owns an iPod. The revolution of the iPod is even more phenomenal from Apple’s perspective as it virtually reversed the fortunes of the company (David Kurtz, 2009). Today, apple dominates the consumer electronics market apart from maintaining a strong presence in the personal computing sector. Market analysts have predicted that the demand for iPod units is set to grow despite attempts from various corners to bring in substitutes. For instance, Apple’s rival Microsoft attempted to compete in this area by introducing the ‘Zune’, which did not create even a flutter. The real question that persists today is to determine how Apple managed to sell so many units of the iPod in a short span of 7 years and whether there is any further room left to grow (Philip Kotler, 2008). The current paper is aimed at discussing the need to study the success of the iPod and its relevance to the performance of Apple during the current decade and in the future. This will not be limited to the question of improvement in sales of iPods, but will also concentrate on the underlying strategies adopted by Apple to create the necessary thrust in sales and thwart any competition in the market. The proposed research will also aim at ascertaining whether there is any further scope for expansion in the market, given the surge amongst numerous companies to introduce competing products. The subsequent sections will lay the framework for the importance and relevance of the proposed topic in the current context. The iPod secret There is no doubt that the word ‘iPod’ strikes an instant chord among consumers and music lovers. In fact, the popular market observation goes on to say that people have an emotional attachment with their music and iPod simply allowed people to reconnect and carry their music. Using the iPod is easier than many simple tasks and Apple has been clever to utilize the provisions of the Internet to great use to further iPod sales. Since 2003, Apple partnered with several music companies and allowed for an aggregation of a bulk of music content available publicly. It then created the iTunes online music store and offered this music to consumers for a very small fee. Users can simply connect their iPod to their PC and use the iTunes suite to download music from the Internet right into their music player. IPod sales have since then soared with each increasing month as the company succeeded in creating the right product that covered a broad range of customers (David Kurtz, 2009). The road ahead Apple’s strategy to boost iPod sales has not stopped with the above-mentioned initiatives. In 2007, Apple teamed up with the popular record company EMI that allowed it to provide music without any digital rights through iTunes. In addition to being cheaper than buying albums in DVD format, the music available is of a higher quality. However, this approach, in theory, is prone to increase competition within the market. Songs that do not have any digital rights can be played on any device, thus providing an incentive to Apple’s competitors to accelerate the development of competing products. However, Apple’s continued belief that this strategy will continue to attract more customers is being seen by industry analysts with much doubt. Although Apple insists that increasing the amount of content available will serve as the main advantage for customers, there is a general belief that other players have been waiting for such opportunities that will allow them to take on Apple through its own products and enhancements. However, another section of the industry believes that Apple continues to enjoy increased success as it has succeeded in achieving two things consistently. Firstly, the product is constantly subjected to innovation that also looks into periodic review of design and style. Secondly, Apple is also known to maintain a competitive pricing model, drawing customers across all economic sections (David Taylor, 2007). There is also a popular belief amongst market researching firms that the move to offer music content free of digital rights would encourage increasing number of people to refrain from using peer-to-peer sites for downloading content. It is due to these reasons that there is an interesting case to examine whether Apple will continue to maintain its sizeable chunk of the market in the coming years. Using historical and market research data, it would be possible to use analytical methods to forecast whether Apple will be able to boost its current volume of sales or whether it needs to rethink its marketing strategy. Additional factors for research Apart from the success of the iPod, and particularly the sale of the iPod mini beyond market expectations, the extent to which the product has outsold the existing demand is testimony to the need for a thorough market analysis of the iPods success. This is further important as Apple was neither the first company to come out with an MP3 player now was it the first to introduce such a player with a built-in hard disk. However, the effectiveness of the product can be judged from the successful combination of three factors: prolonged battery life, requisite form factor and easy connectivity with a PC through USB 8Universal serial bus). This combination could not be matched by any other digital manufacturer. Although the iPod does not figure on top of the list across all these the three individual segments mentioned above, it does cross the threshold of usability rather conveniently without compromise (Paul Strebel, 2008). As such, there is a good basis to examine the product along all these three basic segments and compare it with other competing products to determine how other manufacturers fared in comparison. In the case of the iPod mini, Apple improvised tremendously on the form factor and did not look deeper into capacity. This can be judged from the survey by JupiterResearch in 2007, which estimated that a whopping 90% of surveyed consumers did not prefer to have more than 1000 songs in their music device. Further, more than three quarters of the consumers surveyed were specific about their requirement for a player that did not store more than 1000 potential songs. The storage space of 4GB on the iPod mini is sufficient to contain 1000 songs and is targeted at mainstream consumers, which forms the bulk of the customer base for music players (Ashok Tanchhod, 2007). IPod sales also witness a spike during the holiday season although market analysts predict that the digital music player segment is relatively untapped. Apple has acknowledged that it is examining the prospect of including new features into the iPod but remains tight lipped over the specifics. As such, it provides an interesting area of research to examine the potential areas other than the three core design factors previously that Apple may choose to concentrate upon. Further, maintaining the price tag of $99 is going to be tough in the coming days both due to increasing material costs as well as the cost of inflation (Denis Hauptly, 2008). As such, it needs to be examined whether Apple can maintain its current price tag without compromising on any of the iPod’s current features through an appropriate strategy. Methodology The preceding sections have described the various reasons for considering the area of iPod sales as a requisite area for the proposed business research. Part of the reason stems from the availability of abundant material in the form of articles, market reports and industry analysis that have studied various aspects of the proposed topic described in the current paper. However, there has been no concrete effort aimed at studying the reasons behind Apple’s growth in the iPod segment and whether it can use the same strategy to maintain the predicted growth. To analyze the issue, it is proposed to adopt a two pronged approach. Firstly, the research will make use of relevant primary sources such as market analysts and individuals involved in the iPod business to identify facts and details pertaining to areas relevant to the research topic. Information in this regard will be sourced through appropriate interviews and surveys, which will be based on a well-formed questionnaire. The responses will be aggregated and analyzed for common patterns and specific details to identify potential trends and occurrences that can help identify important facts about Apple’s strategy and performance. The research will also take advantage of the abundance of secondary material in the form of books, articles and market reports that have discussed the performance of Apple and iPod in length. By combining information utilized from these two diverse sources of information, the research will attempt to take benefit of relevant information in identifying the correct information with the greatest level of accuracy. References 1. Philip Kotler (2008), Principles of marketing. New york: Pearson Education. 2. david Kurtz (2009), Contemporary Marketing. London: Cengage. 3. David taylor (2007), Brand Vision: How To Energize Your Team To Drive Business Growth. Delhi: Wiley. 4. Paul Strebel (2008), Smart Big Moves: The Secrets of Successful Strategic Shifts. Financial Times Series. 5. Ashok Tanchhod (2007), Marketing Strategies: A Contemporary Approach. New Yoek: Pearson Education. 6. Denis Hauptly (2008), Something really new: three simple steps to creating truly innovative products. London: CRC Press. Read More