Analysis of Apple Computer Inc - Case Study Example

 I. BACKGROUND Apple Computer Inc is dedicated to provide the latest, state of the art gadgets whether in personal computing or digital media distribution (Apple Inc. 2010). Its thrust is to continue developing its current product line up and discover more technological breakthroughs to be able to offer better products to the market. It has maintained market position as it sold an estimated 1.4 Million Macintosh Personal Computers, or a growth of 34% for the first quarter of 2010 (Garner: Apple sells 1.4 Million Macs in US, captures 8% market share. 2010), and continues to fight for market share with the emergence of new products such as the IPad. The company is widely known for its Mac OS Server Operating Systems, which is a far cry from traditional albeit, more popular Windows Operating Systems (Apple 2010). However, with the competitors’ launch of a product similar to the Ipad, Apple Computer Inc. now intends to be more vigilant in protecting its unique product line up and release more models that would signify its position as the market’s leading personal computer vendor. Smaller companies have started attacking Apple’s market share by coming up with cheaper versions that offer similar benefits at a much lower price. These copycats tend to become alternatives for people who are tight on the budget but would like to have similar experience with their personal computers. Of course, the quality is not the same, and some unique features of the Ipad is yet to be duplicated, but the threat of losing precious market share to these small players is eminent. In fact, the threat looms over Ipad, and management is keen on doing something about it. II. MARKETING OBJECTIVES This plan aims to achieve the following: 1. Increase market share to 55% and be able to enter the world’s top ten list of Personal Computer vendors. 2. To find more suitable sales channels that would effectively conduct retail sales of the Apple Mac Books and Ipad. 3. To enhance product development to enable the product to offer more value added features to the customers. Achieving these objectives is tantamount to the overall company growth and revenue. If Apple Computer Inc wishes to overcome current obstacles to the business, management must focus on achieving quantitative as well as qualitative revenues. There is a need for the company to find ways to maintain, if not improve market position, in the US, UK and the rest of the world. Human resource is vital to the achievement of these goals. Apple should work on getting a task force team that would spearhead the organization towards moving forward and overcoming threats and weaknesses. Motivating the sales force the right way would also mean getting them to exert more efforts to push the products and gain incremental sales. III. SWOT ANALYSIS Apple Computer Inc has been in the market for over three decades now, and continuously provides the market with better personal computer and operating system choices. STRENGHTS: 1. Brand equity. Apple Computer Inc, and brands associated with the company such as IPod, Ipad, Macintosh notebooks among others are highly popular in the market. Setting the trends for gadgets, brand names may even be referred to as product names, proving the popularity of the brand. 2. There is a favorable brand perception attached to the Apple Brand (SWOT Analysis Apple. 2010). Customers generally express preference for the products mainly because of strength number 1 which is brand equity. WEAKNESSES: 1. With the company’s persistence to always be a pioneer in gadget and technology trends, there is a tendency to prematurely release breakthrough products, such that defects and negative characteristics are not yet fully eliminated by the time the products hit the market. The IPod took some time to be perfected and evolve. Even the IPhone had to go through a succession of baptism of fire of sorts in the market before finally being able to release near-perfect models. The IPhone has been criticized to have malfunctioning and non competitive features for a time. This is something the company had to deal with for a considerable amount of time, with it spending sums for publicity and anti black propaganda strategies. OPPORTUNITES 1. Isn’t there anything that technology cannot offer? With the continuous discoveries in mobile and data technology, Apple has lots of room for product growth and expansion. As a personal computer vendor, there is always an opportunity towards the achievement of market success. The product development teams and current partnerships with IBM and other companies enhance market growth and makes room for more breakthroughs in terms of products. Apple Computer Inc sees a long road ahead, and plenty of resources and partnerships to explore to be able to come up with more newsworthy products. THREATS 1. Improvised phones, most of them are China made and being offered at much cheaper prices pose as a great threat to the brand. These products are being preferred by most people who are budget conscious. With these products, customer may now enjoy the benefits and features of an Apple unit, without having to pay the right amount. 2. Competitor’s release of a product very similar to Ipad poses as a major threat to the company. This new version is said to be cheaper, and uses another Operating System very similar to Windows. Windows still is highly popular among the market, and there is strong preference for this OS over the MAC simply because of its easy-to -use features and benefits. IV. ACTION PLANS 1. Increased incentives to the sales and business development teams. Companies often use incentives to add motivational value and achieve targeted results for particular brands or services (Creating Sales Incentive Programs that Work 2010). And these incentive schemes often work for the company. Management will implement a tier bound incentive scheme for its sales distribution channels to ensure their full support to the brand. Retailers and dealers get maximum possible discount for every bulk purchase and an increase in discount for volume purchases. There will also be quarterly and annual bonuses for account managers who are able to sell a set volume of Apple products. The incentive scheme will vary per product, with the most important product line given the most shares of the incentives. The strategy is to highlight favored brands and products to give them the much needed market boost. Sellers will enjoy discounts and incentives, which are both monetary and non monetary in value. Business Development teams or the people behind finding the right distribution channels will also enjoy added income opportunities by being given additional commission for every dealership opened. Target areas for roll out are in areas outside the US and UK, and concentrated on the South East Asian market. There could be a threat to go against China made phones, but the challenge is to outdo these copycats by maintain high quality features of the Apple products. 2. Higher budget to support the product development teams The Product Development team is responsible in innovating product line and features and establishing working relationships with trade partners such as IBM, Intel, among others. As such, focus should be given to the projects they undertake that they reach maximum potential. Research activities must be given utmost importance, with the purchase of machineries and equipment and sending off people to further studies for information enhancement. Research teams will be given priority. Production teams’ efficiency will be reviewed as well. The management will look into current systems and procedures for the production group to ensure that they deliver quality products within the set standards. A good product development strategy provides the company the framework to align development projects and development processes (Product Development Strategic Orientation 2010). 3. More aggressive above the line marketing, tapping celebrity endorses and getting testimonial for the brands. The Apple Company has always been aggressive with its above the line campaigns, producing advertisements in tri media in different countries and regions. The current advertising agency is considered to be costly, yet the production values are low and the advertising efforts low on recall. Management is set to explore possibilities with other advertising agencies to create localizes/ regionalized advertising materials. This way, the message will be delivered effectively across cultural groups and languages. There will be targeted advertising campaigns both in TV and Radio, with production values parallel to the culture and demographics of the target market. United Stated and UK Celebrity endorsers will be tapped for various products. These people provide the added novelty to the brands, and will add to the popularity of the products by providing testimonials. Endorsers should be able to relate to the target market, and must have positive values and images that would represent Apple products as well. On top of this, there will also be local celebrities who will serve as the face and voice of the products in each of their own countries. The appeal of having celebrity endorsers will provide the much needed boost in targeted areas as well. There will be thematic campaigns for the products, which will coincide with important annual events. Thematic campaigns will encompass TV, Radio and Print advertising efforts, as well as below the line activities to promote brand recall. Thematic campaigns provide a certain level of personality to the brands, and the effect will be long lasting. 4. Tactical below the line advertising for Retailers and Dealers/ Distributors The company will spend on new merchandising materials that would be provided for the benefit of dealers and retailers. These new materials are both informative and entertaining and would serve best the purpose the retailers who are also making business out of selling Apple products. Materials include mobiles, posters, and tent cards and take ones. There will be informational materials such as flyers and brochures as well. These materials provide up to date information and resources for the products and brands and would be beneficial to both retailers and consumers. Design will be localized as well, and there will be regions whose language will be featured in the brochures to make it more targeted and personalized. Local printers and advertising teams will be tapped to make the efforts as close to the target market as possible. In certain regions, manpower support to aid the dealers in their selling activities will also be provided. Trained manpower will be deployed to provide technical and after sales activity as well. These people are going to be paid for by the Apple Company and will serve as living and interactive merchandising and selling tools in the retail areas. Manpower support will provide the company with an edge over other PC vendors. These walking merchandising tools will not only be able to explain the products thoroughly, to the satisfaction of the target market, but also could conduct after sales activities that would encourage people to patronize Apple products even more. Apple will sponsor events, both locally and internationally to provide the products with exposure in targeted areas. These events provide the people with an opportunity to interact with Apple products and encourage trial usage among the target market. Sponsored events will also boost the product image and provide a venue for endorsers to come face to face with the target market for further promotions. Events will both be profit and nonprofit oriented. Sponsoring events for a cause will also give the Apple image a good lift, and its products will be identified with humanitarian efforts, which will be good for the public relations and appeal. Events may include concerts, galas performances, concerts, art shows and the like. These may also be local or international, and the materials thematic as well. All in all, the Apple Company will implement major changes in its internal operations to ensure that all company activities are aligned. There should be uniformity among all the efforts, with all the key people working together towards the achievement of the corporate goals. Reference List Apple. Crunchbase. May 12, 2010. From http://www.crunchbase.com/company/apple Apple Inc. Hoovers. Retrieved May 12, 2010 from http://www.hoovers.com/company/Apple_Inc/rtjcci-1.html Garner: Apple sells 1.4 Million Macs in US, captures 8% market share. ZDNet. May 12, 2010. From http://www.zdnet.com/blog/gadgetreviews/gartner-apple-sells-14-million-macs-in-us-captures-8-market-share/13904 Product Development Strategic Orientation. NPD Solutions. May 12, 2010 from http://www.npd-solutions.com/strategy.html SWOT Analysis Apple. Marketing Teacher. May 12, 2010 from http://www.marketingteacher.com/SWOT/apple_swot.htm Read More