Public Relations Plan for Apple - Term Paper Example

Public relation’s plan for Apple Situational analysis Situational analysis is concerned with environmental analysis, using the PEST1 technique, followed by a SWOT2 analysis - based on a wide range of industry and pressure group reports; individual company websites; Governmental activity and media coverage. Such ‘environmental monitoring’ (Tench and Yeomans 1996), which is usually called ‘environmental scanning’ (Grunig 2001), identifies environmental actions, which may compel reaction from the organisation and facilitate strategic changes. According to Harrison (2004, p.321), this is key to the strategic process and a requirement to ‘being invited to the management table’ - supporting the conviction that constant scanning is essential for effective Public Relations. The following section illustrates the PEST analysis followed by SWOT analysis, for Apple Company. External analysis The current Apple’s situation is determined by the external environment. This also helps determine the potential influence of the company’s economical, political, technological, as well as the social factors. Political Factors Reports say that, in 2007, Apple obtained 52% of its business from outside US (Richard Ivey School of business, 2009).Terrorism and wars are likely to significantly influence the company as a result of poor international relations. Therefore, it is critical that the company controls these external factors. Apple Inc. produces some of its products from outside the US, including Korea, Cork, China, Ireland and Czech Republic. The awful political relations between US and the external world can lead to many negative results if not carefully controlled (Richard Ivey School of business, 2009). Economic Factors The company’s performance is highly dependent on the impact of the global economic crisis. Since Apple’s products are perceived as luxurious, the customer reduced the budgets in them when the inflation and rate of unemployment skyrocketed. The company’s products also experience enormous challenges due to endless fluctuation of the US dollar. However, the economic impacts on the company are reduced because Apple has hedged most of the risks by purchasing foreign currencies. As a result, the company’s revenue has increased in the international market (Richard Ivey School of business, 2009). Social Factors Two factors that have played a very important role in Apple’s product history include design and quality. Therefore, globalisation is on the forefront in determining the competitiveness of the company’s products. Apple’s products have been very visible on the global market since their quality and design is highly valued. What’s more, since many parts of the world have experienced increased purchasing power, the affordability of Apple’s luxurious products has significantly gone up, for example, iPods, the iPhone and other gadgets that use latest technology (Levy, 2006). Most of these products are considered as a status symbol in the society. Furthermore, the recent expansion in the music industry has had the company’s products undergo a rapid growth. Music industry, including the popular iTunes music stores, has also dramatically increased the cyber space market. As Apple begins to define a modern individual lifestyle, virtually all its products have drawn advantages from social factors (Levy, 2006). Technological Factors Product research and development has been one area that Apple has invested heavily, which has seen its products ranked highly in terms of innovation. As the technology rapidly changes across the world, the market of Apple’s products has grown big. However, this has also increased competition, hence drastically shortening the products life cycle. Apple takes advantage of these dynamics by introducing newer products every now and then, hence ensuring that it maintains its lead in the market (Levy, 2006). Legal Factors Apple has defended several lawsuits that has been filed against it by Nokia, alleging that it had violated 13 additional patents by iPad, iPhone, and iPod. There are also a couple of other US complains involving 24 Nokia patents. In addition, in China, Apple has defending its right to the iPad trademark. The potential outcomes of these lawsuits have dire consequences on the future of the company’s products and business (New York Times, 2004). SWOT analysis SWOT analysis stands for Strength, Weaknesses, Opportunity and Threat. This helps Apple in analysing its external environment (Opportunities and Threats) and internal environments (Strengths and Weaknesses) as well as in planning a strategy for its business. Strengths Increase in the growth due to global presence. The Apple Company distributes its products a worldwide, its major markets being in Asia, Europe and the United States of America. Statistics, however, prove that more than 50% of their sales originate from external markets (Apple Inc. 2013). It is also proven that Apple Company has continued to show a significant growth in its several markets worldwide registering a 4.2 % profit margin in 2009 and a 2.8% on industrial average (Apple Inc. 2013). Due to stability in its performance and continuous strength in its operations, a lot of investors are swayed to invest in Apple Company. Variety products and services The Apple Company deals with a variety of services starting from computes, phones, Computer software, Peripherals, manufacture designs and many other income generating activities. This enables the company to spread any risk of loss from non performance of a product or service since other product restores its financial performance by gaining large amount of profit from such opportunities. A variety of products and services has made the company a major ball player in the investment and company business and this has been maintained because of its leading innovation (Apple Inc. 2013). Brand image The Apple brand image is widely known to customers. In addition, due to customer awareness, it enjoys customer loyalty making it capable to stay in the market and coexist within fierce competition. Custom awareness is fuelled by the fact that the company produces quality products with a custom brand image, which is widely recognised. Its brand image deters the entry of some products in the market and enables the company to fetch attractive price packages due to the customer’s loyalty (New York Times 2004). Media involvement Apple Inc. has widened the scope of its activities by registering with many media companies. Currently, Apple Company is doing very well in the music industry as its Iphones and some iPods can download music directly from music websites for direct enjoyment of its customers. This level of efficiency has generated a lot of awareness and profits for Apple products, considering that music sales alone generate a lot of profit (Levy 2006). Weaknesses Low returns Although Apple Inc. is making huge amount of profits, it experiences reduced returns in comparison with the previous years. This is a matter of concern as its strength in the market depends on how it brings countermeasures against its competitors. Sales/ marketing force Compared to its competitors IBM, Apple Inc. has few sales/ marketing agents with direct contact to corporations (Uttal 1985, pg. 22). Operational costs, Apple Company incurs a lot of operational costs in its several retail outlets worldwide, which amounts to limited returns in saturated markets. This gives Apples competitors an edge over them (Schoenig et al. 2005, pg.14) Incompatibility, Lack of realism, high prices Apple company products lack compatibility which discourages consumers from using them since they cannot buy a part or use it in another machine. The CEO of the company lacks realism as he continues charging high prices in Apple products despite of the reduced prices by its competitors (Lliel, Lindinger and Poettler 2004, Pg.160) Dependence on key manufacturing Components Some of the Apple’s competitors supply it with key manufacturing components. This is not healthy business wise as it can put the company in undue disadvantage in terms of competition. IBM supplies Apple Company with the G5 processors whereas Freescale supplies the company with G4 processors. These two processors are key components of manufacture of Apple’s products (Lliel, Lindinger and Poettler 2004). 2.3 Opportunity According to the prediction of CEA, the electronic technology business has a large and growing trade, and hence since Apple has much competition IT advantages have a good opportunity to expand locally and internationally (Levy 2006). With the constantly emerging electronic manufacturing services in the developing countries, Apple is expected to further improve the rate of profit and optimise its products value chain. Currently, the company is holding more bargaining chips since component producers are faced with fierce competition in terms of price, quality and service (Levy 2006). ). A progressive increase in PC viruses is opening many doors that Apple can take advantage of. The fact that the global population is growing rapidly means that the potential market for Apple products is expanding fast. Furthermore, the urge for luxury products is growing rapidly as a result of increase in consumers’ purchasing power. What’s more, the online sales are increasing very fast, while the relationships and partnership of Apple with other organisations have been improving years on end. Innovative products such as iPhone have created new market in the young consumers who are seeking stylish and expensive gadgets – this can be the focal target market in the future. 2.4 Threats At present, Apple has fear of a US collapse and the consumers’ low confidence with the markets as a result of the global economic slowdown and the pressure of currency inflation. Apple is faced with a number of strong competitors, such as the Android operation system, Dell, and Sony, and Toshiba, all of them dealing with the kind of products that Apple produce. High imitation products have done great harm to the brand image of Apple and such “piracy behaviors” have made a profound impact on its profits. Free music download is also Apple’s great worry because peoples are likely to abandon its subscribed iTunes music download. Since most of the company’s products are expensive, there is a threat associated to this because most of its substitute products are selling at a lower price and they are always available in the stores. The endless economic recession is also threatening its business, because most of the potential customers are unable to afford expensive gadgets (Levy 2006). Publics The stakeholders of Apple are largely extensive. The most important ones include lenders, employees, customers, software developers, media, suppliers, and music industry. The diverse stakeholders are featured in Appendix III. The following publics have been identified as essential to the accomplishment of this research. Customers The customers are the end users of Apple’s products and services. Before Apple discloses about its products to the customers, the PR has the responsibility of studying them carefully, particularly examining the potential impact on their introduction. In so doing, it is possible to manage potential negative impacts that may affect the performance of the products or the company’s brand. It is also very important for the company’s PR to believe in what it is selling, because if the virtues of the company’s customers’ offering are not trusted, then it becomes hard convincing them that the products are of any value to them. Furthermore, being truthful to the customers is crucial because this ensures that the company spends very little to convince the customers that the new product is really innovative. In public relations, it is particularly important to identify the intent of the customers, since this makes the campaign more informative and focused, hence making it successful. This PR plan will focus on creation of mass awareness and intent, by reaching to the customers who already have the intent, with the precise information that they are searching. Identification of the consumer’s intent might turn out to be tedious, but this may be eased by use of online techniques (Apple Inc. 2013). The media When Apple launches a new product, what follows is a buzz of rumours from the media, from all over the world. Thousand of bloggers and technology journalists globally focus on what the company’s C.E.O has to say about the new product. A quick search into the internet showing the frenzy following an announcement of a new product is shown in Appendix II. Apple’s iPad has been covered by media 6 Million times on the search engine, while more than 330,000 blogs have mentioned it from across the world. Generally, Apple has remained tight lipped, a strategy that has worked for it in different ways. For example, videos about its tablet PC were released on YouTube way before its launch, while speculations about the same product were filled in the market, yet the Company managed to take the market by a surprise. In the arena of Public Relations, today’s explosion in the social media is a force to reckon with. It is a matter of paramount importance for Apple to conform to use of social media as a public relations tool. When Apple is undergoing a crisis, it becomes very essential to defensively manage risk, which requires deliberate crisis planning. With its tremendous following by the media, Apple occasionally leak small bits of information to test the public interest in its products, since it is usually expected that its products will be a cutting edge (Apple Inc. 2013). Problem statement As studies have shown that good reputation is essential in ensuring that a company’s products are liked by the public, Apple stands at crossroads when it comes to launch of new products, because if not managed well the buzz created by the media is likely to taint its reputation. Strategy On account of its extreme public following, Apple will regularly and deliberately disclose small bits of information to how the public will respond to their products, and also use memorable ads and highly innovative products to encourage the media to generate a lot of positive information about them. Rationale connected to role of PR practitioner While the marketing and communication of Apple are critical in leading the company to its current success, in reality, this success is not just limited to their efforts. The effort played by Public Relations team during the launch of its products is even more important. This team can be entrusted in positioning the company as the manufacturer of the most popular products across the world. Apple has position itself as a cutting edge technology company, which has managed to change the direction of the technology for many years. Public relations are associated with creation of a good appeal of the products around the company’s clients. This is only possible when the products are of high quality, good looking and ones that the customers enjoy using. Ultimately, if the customer’s experience is compromised, then the media will finally leak the truth out. The PR should make efforts to ensure that Apple’s products and their users speak on its behalf. Although the Apple could be involved in exaggerated advertising and public relations, the difference between reality and perception is hard to understand as today’s the web of words and images that are used in product campaigns are so confusing. Identifying a person’s intent can be a tedious and a long process in the offline world, but a PR can use the internet to easily understand and use a potential customer’s intent to their benefit. Some of the most important intentions for consumers going online include: learning, having fun, socializing, expressing oneself, to advocate, shopping, and doing business. This is illustrated by intent index as shown in Appendix III. This insight can be used by PR for four different reasons, including finding the clients’ target customers, finding the reason why a person could be reading about the clients’ products, the channels that can be used to reach out to potential customers with the right information, and the methods that should be used to reach each of the segments as differentiated by the user’s intent. Apple will use such information to reach out to its customers, when introducing new products. Like many customers are used to, Apple shall not get involved in all time following up with the customers through the social media, due to the realization that such a strategy does not always work in the favour of the company. Nevertheless, the company shall invest in a superior customer service, whereby the employees will be required to deeply care about its reputation. I other words, the employees will exemplify the modern idea of brand ambassadors. Objectives 1. To sift the amount of information released to the public about the company’s forthcoming products, thereby evading negative publicity. 2. To build a superior brand by unveiling more and more products of high quality and ensuring the employees adopt the role of brand ambassadors. This way, the media will find it extremely hard to spread negative rumours about the company’s products. 3. Influencing the public opinion by extensively studying what the potential customers want List of tactics 1. Being honest and unbiased when assessing the company’s competitors and clients 2. Find the differentiating factor between Apple’s customers and the competitors find the best ways of using such information to market Apple. 3. Studying the company’s products before releasing its information to the media or the public. 4. Finding out where potential customers look for information. 5. Asking the customers to participate, for example by leaving comments on the company’s products – this gives a better idea of the customer’s intent. 6. Avoiding engaging customers in the social media. 7. Creating simple and reliable products that will help the company gain market share by influencing the public trust. Evaluation Evaluation for PR research will apply McNamara’s Model, as shown in Appendix IV (Macnamara, 1992). This model applies both open and closed system evaluation. As explained by Baskin and Aronoff (1988; 1992, p. 191), closed system evaluation focuses on pre-testing media and messages followed by comparison of these to post-test outcomes to assess whether the planned goals have been achieved. On the other hand, closed system evaluation relies on the events and messages intended in a campaign and their consequences on the targeted publics. Therefore, open system evaluation will put into account the uncontrollable factors has impact on the results and their considerations are wider. This method will be used to assess the overall effectiveness of the company’s campaign program. To bring about a more desirable effect, a combination of closed and open system of evaluation will be applied for the purpose of this research, as shown in Appendix IV. References Baskin, O. and Aronoff, C., 1988; 1992. Public relations: the profession and the practice (3rd ed.). Dubuque, IA: Wm. C. Brown. Grunig, J., 2001. Two-way symmetrical public relations: Past, present and future. Cited in R.L. Heath (Ed.). Handbook of public relations. London: SAGE. Harrison, S., 2004. Public Relations An Introduction Second Edition. London: Thomson, pp8, 21-24 Levy, S, 2006. The perfect thing How an iPod shuffles Commerce, Culture and Coolness. New York: Simon and Schuster Lliev, V. And Llindinger, A. et al., 2004. Apple Computer Inc Strategic Audit. London: Dublin institute of Technology FT351 Business and Management year 4.Business and management Macnamara, J., 1992. Evaluation: The Achilles Heel of the public relations profession. International Public Relations Review, Vol. 15, No. 4, p. 19. New York Times, 2004. State of Arts for I pods: 6 flavors of flattery. New York times 12th February, 2004. Richard Ivey School of business, 2009. Strategic Planning at Apple Inc. The University of Western Ontario (IVEY 9B09A026): Sage. Schoening C, Sundberg, M, and Pazoki et a., 2005, Apple Computers, Inc. (AAPL): Comprehensive Business Analysis Tench, R. and Yeomans, Liz., 2006. Exploring Public Relations, London: Prentice Hall Uttal, B, 1985, Behind the Fall. London: Fortune Appendix I Appendix II Appendix III Intent Indix. Appendix IV Read More