Comparative Analysis of Integrated Marketing Communication: Apple Inc vs Dell Inc - Essay Example

Comparative Analysis of Integrated Marketing Communication: Apple Inc v/s Dell Inc Executive Summary Vast changing business environments are giving birth to emerging concepts and phenomenon in every field. A new concept that has been developed in the 21st century is of Integrated Marketing Communications. This concept emphasizes upon the harmonizing of different marketing channels and utilizing them in order to penetrate the minds of consumers. Major components of Integrated Marketing Communications include personal selling, direct marketing, advertising, public relations, publicity etc. When it comes to Integrated Marketing Communications, all these marketing channels work simultaneously. This paper performs a comparative analysis of Integrated Marketing Communication of Apple computers with Dell computers. The first part of this paper provides a brief introduction of both the companies and their respective marketing mix, which includes comparative analysis of price, product, place and promotion of Apple Computers and Dell computers. The body of the paper is comprised of brief review literature, which highlights some recent researches in regards to the effectiveness of Integrated Marketing Communication. Moreover, research methodology is also present in this part where the comparative strategic analysis of both the companies is included. The paper ends with detailed conclusion and recommendation providing insights to the future prospects of both the companies. Introduction The IT industry has become extremely competitive market nowadays. Numbers of successful companies are contributing in this industry by offering wide range of products. Names of such companies include Dell Inc, Apple Inc, HP, Toshiba, Samsung, Panasonic etc. Dell has acquired the status of international success and is considered as one of the biggest competitor in its relevant industry. On the other hand, Apple’s products are widely sold all over the world. Therefore, possesses millions of brand loyal customers. The reason that both of these companies have not only survived but have managed to flourish into multi-billion dollar force are their unique marketing strategies. The most prominent of those strategies is Integrated Marketing Communication approach. Introduction to Integrated Marketing Communication Integrated Marketing Communication is a terminology, which is used to define a holistic approach towards marketing communication. It ensures the corresponding usage of media as well as uniformity of messages. Both online and offline marketing channels are included in it. Examples of online marketing channels include Search Engine Optimization (SEO), e-marketing campaigns, email, affiliate, pay-per-click, banners for webinar, micro-blogging, blogs, RSS, internet TV, podcast etc. Offline marketing channels include traditional printing approach (magazines, newspapers), public relation (PR), mail, order, billboard, television, radio, industry relations etc. Integrated Marketing Communication puts together all the marketing tools, resources and approaches within a company, which capitalize on greater impact on the minds of consumers. Consequently, higher profits are enjoyed at minimum possible cost. Nowadays, those companies, which are utilizing this approach, are peak performers in the industry. Market Review of Apple Computers and Dell Computers Marketing Mix Product Both the companies belong to same industry and therefore provide same kind of products i.e. computers and laptops, computer hardware, software, peripherals etc. Despite of selling similar products, there are number of differences between the products of the two companies. It includes designs, models, features, graphics etc. Price Dell serves a target audience with social location and of different income. It sets its prices from $500 to $3000 whereas prices of Apple computers start from $1090 and exceeds $3000. The pricing strategy of Dell emphasizes on providing such laptops, which satisfy the needs and wants of their consumers along with affordable prices. In contrast to that, many customers cannot afford computers of Apple due to high prices. Place Dell and Apple utilize similar platform to sell their products. They possess stores in different countries. In addition to that, Dell has focused on selling its products online, therefore possesses very few stores. Promotion Both the companies utilize similar promotional strategies i.e. psychological tactics in order to promote their products. For instance, Apple sets price of $529 instead of $530 or $1090 instead of $1100. Dell utilizes the same strategy to appeal the customers emotionally. Other promotional strategies of Dell include advertising through internet and television, newspapers and magazines, direct mail ad campaigns and even sponsorships in sports professionals. Positioning Apple Computer has positioned its products for a certain class of customers, which includes innovators, wealthy people, elite customers, people with good lifestyle, good jobs etc. If lower class starts to buy Apple products then Upper class would halt buying Apple products since it is no more a ‘Porsche of computers’. In contrast to that, Dell has positioned its products for middle class customers. It provides affordable yet competitive products. Target Market Target Markets of both the companies are entirely different. Apple sells its products to elite class, hence earning on selling price rather than sales volumes. In contrast to that, Dell earns on volume rather than selling price since it provides affordable products. Apple sells its computer to upper and upper middle class whereas middle class and lower middle class can easily afford Dell computers. Branding Apple has built a strong reputation and thus, a very strong brand. It is one of the most expensive brands that are being sold on the face of this planet. Apple has set such image in their consumers’ minds, which associates Apple products with terminologies such as top-notch quality, class, design, innovation, expensive, extra-ordinary, worthwhile etc. On the other hand, Dell’s brand image is more towards affordability, user friendly, expandability, availability etc. Competitiveness Despite of serving a different class of customers, both the companies have strong competition with each other. The reason is to acquire the greatest market share. Dell is facing customers who have strong influence of Apple’s brand image and therefore, it has to face tough competition from Apple. Literature Review Grein and Gould (1996) have focused upon the effectiveness of integrated marketing communications. The authors have put forward the concept of globally integrated marketing communications. According to Grein and Gould (1996), globally integrated marketing communication merges the approach of integrated marketing communication with communication perspectives and international marketing strategies. In addition to that, Grein and Gould (1996) have provided the contingency approach that impact the global marketing strategies. In the entire research, the emphasis was upon the effectiveness of integrated marketing communication. Holm (2006) has conducted a study in which he stated the importance of Integrated Marketing Communications for today’s organizations and businesses. Holm (2006) stated that Integrated Marketing Communications is one of the most significant developments in the field of marketing. It has widely influenced the competition and their realities in an open economy. Holm (2006) discussed some stages of Integrated Marketing Communications, which includes tactical co-ordination, financial integration and strategic integration. Holm (2006) stated that there are number of obstacles, which prevent businesses from moving from one stage to another. The author has discussed those obstacles in detail and has put forward measures to overcome them. Reid (2005) has conducted a research in order to examine the association between brand outcome and Integrated Marketing Communication Processes. The variables for brand outcome included sales, brand loyalty, brand awareness etc. Data was attained from both, consumer services organization as well as consumer goods organization. The result clearly concluded a positive relationship between Integrated Marketing Communication Processes and Brand Outcomes. Reid (2005) encourages further research in order to validate the phenomenon. The above-mentioned researches have validated and justified the importance and effectiveness of Integrated Marketing Communications in today’s business environment. The authors recommend utilizing these approaches in order to gain competitive advantage over rivals. Research Methodology Apple’s strategies involve focusing primarily on vertical marketing. Expertise and knowledge are most valuable assets as far as Apple is concerned. It brings in high-tech products through different channels of marketing. The promotional strategies of Apple focus on Public Relations. However, it takes into account all the available modes of communications through which it can correspond with its customers. The purpose of utilizing Public Relation as an imperative part is to establish Apple computers as benchmark product in order to patronize the customers. On the other hand, Dell has ruled the market for years by providing best possible customer service and support. In this regard, it has remained key differentiator in its industry and maintained the ‘Number One’ position for several years. This segment contributed with expanded revenue streams to the firm. However, the customer support and service for Dell has been declining for the past few years. Reducing training programs and outsourcing the customer support and services has spoiled the reputation of the company. According to surveys, Apple has been leading the market for the past several years surpassing all the competitors. It provides top-notch products despite of that, it possesses some limitations. The biggest limitation is that it does not cater the entire market and serves only elite group of customers. If Dell comes up with a differentiated product serving upper class customers then there are substantial chances of loss of Apple’s monopoly. On the other hand, Dell computers also possess some limitations, which include so many under-serving markets. Moreover, if Dell wants to increase its customization position then it must strengthen and increase its configuration choices. It can be done by establishing additional relationships with suppliers. Slogans of Apple Computers Ad slogans:  “Think different” “Apple Macintosh. The computer for the rest of us” “The Power to Be Your Best” “Macintosh, It Does More. It Costs Less. It's that Simple” Slogans of Dell Computers Ad slogans:  “Dell, Purely You” “Dell, Uniquely You” (Australia) “Easy as Dell” “Be direct” Marketing Messages Dell Computers Dell’s marketing messages traditionally stressed over either the main features or the price of PCs. The features upon which the Company has typically stressed are memory capacity and computing speed. Such type of advertising tactics increased sales of Dell in past, but now they have lost their effectiveness since consumers are now getting more considerate about the aspects and designs of their PCs. Apple Computers Marketing messages that are used by Apple computers primarily focus on being inspirational and user-centric. Apple computer speaks directly to its customers and arouses best emotions in them. No other company, other than Apple computers, does emotion marketing as well as Apple does. This is the core of marketing playbook of Apple. Media and Marketing Campaigns used to attract consumers Apple Inc Apple has utilized several medium for attracting its customers. The company executes both TV and print ads. The reasons is that the percentage of youngsters reading trendy magazines and watching TV is higher than listening radios or music online. The reason is that while a college students is online and some ad pop ups, it usually irritates them because the person is usually doing something where they do not want to be bothered. Apple computers print ads on magazines, having daily readers. The target market includes both men and women aged between 18 to 25. Some of those magazines include Cosmopolitan and Maxim. Moreover, Apple has also been utilizing electronic media i.e. television for showing its ads. It stresses on showing ads in prime time i.e. from 7 p.m to 9 p.m and especially, when famous TV shows such as Grey’s Anatomy are running (Miller, 2012). Dell Inc Dell has been focusing on selling its products online rather than through stores. This medium of selling led to substantial problems because usually customers are more satisfied when they are given superior customer services at stores rather than carefree services through online systems. Dell generates only 20% revenues from its household customers therefore the company is now seeking consumers’ love through its TV ads. In 2008, the company studied the consumer market in more depth. The consumer market of Dell consist of Generation Y, families with children, youngsters in their twenties, professionals, video games enthusiasts etc. moving ahead, Dell plans to organize its marketing and devices around these people through more fun and funky TV ads. According to Steve Felice, President of Dell’s Consumer and Small and Medium Business, “It’s time for us to become the most-loved PC brand in the industry.” (Woyke, 2010). Brand Image Apple Inc Since Apple has focused on emotions while formulating its brand strategy, the Apple’s brand personality is more about hopes, aspirations, dreams, innovation, liberty regained, imagination, lifestyles through technology. The brand image, which Apple conveys to its customers, is about removal of complexities from the lives of people and simplicity. Apple possesses an image of being a very humanistic company, having a heartfelt relation with its customers. Dell Inc Brand image of Dell, which persists in mind of its customers is more inclined towards affordability rather than uniqueness, high-tech, innovation or emotion. Effectiveness of Marketing Tactics   Apple Computer The beautifully designed, innovative, technologically leading and highly economic products which Apple offers not only match the brand promise but are also elemental in fulfilling this promise. Apple computer ensures excellent customer experience. For majority of Apple’s customers, it is not possible to switch to other brands due to delightful experience with Apple as well as unique marketing tactics. Dell Computers Initially, Dell’s marketing tactics lead to soaring growth but as soon as competition got intense, Dell started to lose its market share as well as a large number of its customers. Most of its customers switched to other brands. The marketing tactics of Dell were, therefore, not so effective. Critical Analysis and Discussion Certainly, just like any other company, Apple wants to increase market share, increase profits and maintain brand image. In contrast to most of its competitors, Apple has managed to show tremendous growth in terms of gross profits as well as increase in share price. Apple has invented, marketed and sold almost every type of consumer electronics varying from computers to music players and from phones to smart TV. Apple has demonstrated an example of highly intelligent strategy. These reasons have supported the overall brand image and reputation of the company, which has led to stronger and higher sales of almost every product of the company. The company has tapped into every type of consumer electronic product and has managed to correspond with customers through every channel of marketing thus, utilizing a better approach of Integrated Marketing Communications. In contrast to that, Dell has been serving customer only PCs market. Despite of utilizing all the possible channels of marketing, Dell has not been able to reach the market as intensely as Apple did. Both the companies have utilized similar marketing channels but through different approach. Both the companies have utilized the channels of Integrated Marketing Communications, but Apple has outperformed all of its competitors including Dell. The biggest limitation of Dell is to sell the products through online systems. Apple has acquired the approach of selling through distribution stores where customers can not only buy the product but also receive full experience of enhanced customer service. In contrast to that, Dell sells its products online where customers do not feel themselves as integral component of the organization and do not receive customer service experience as well. Apple’s success lies not only in its marketing communication strategies but also in its innovative and high-tech products. Dell has started to lose a big chunk of its market share since Apple has come up with number of strategies, products and marketing channels one after the other. Many of Dell customers, who could afford, have switched to Apple. Therefore, now Dell possesses only those customers who have affordability issues. Conclusions Integrated Marketing Communications incorporates different marketing channels such as personal selling, advertising, direct marketing, publicity, public relations etc. After reviewing the importance of Integrated Marketing Communications, it has been observed that those companies who have properly utilized this strategy have gained substantial success as compared to those, which have not. By examining the researches, this phenomenon has been further validated. The example of Apple computers also authenticates the effectiveness of Integrated Marketing Communications. Successful strategies lead to lead successful companies. Successful implementation of Apple’s strategies have led to the production of better and more innovative products whereas lack of proper direction and strategy of Dell has made it lose a large part of its market share as well as its customers. Dell and Apple make use of the same strategies in an entire different manner. Dell is more inclined towards its online company and possesses stronger business-to-business relationships while Apple is consumer-oriented and emphasize on meeting the demands and needs of its consumers by focusing on broad distribution and consumer choice. Apple has always been concerned of consumer satisfaction and therefore, maintains assurance of quality. At Apple, there is no compromise on quality in fact the best quality products are provided which no other competitor is offering. This strategy has led to a distinct brand image of Apple. Recommendations Apple has always been able to maintain a consistent approach of providing best and most innovative products. Instead of relying on a single approach for corresponding with customers i.e. through online support system, Dell has to adopt the strategy of utilizing different channel of marketing for reaching its current as well as potential customers. Dell must utilize all the possible marketing channels i.e. personal selling, direct marketing, advertising, public relation etc. in order to keep pace with its competitors. If these strategies are not taken care of, then there are huge concerns of survival of the company in upcoming years. Realizing the potential of its competitors, Apple has to adopt vigilant strategy and must be prepared with contingent strategies in order to prevent losing its market share. Without foreseeing its rivals’ possible actions, it can be difficult for Apple to maintain its existing position in the market. Works Cited Blakeman, R. Integrated Marketing Communication: Creative Strategy from Idea to Implementation. New York: Rowman & Littlefield Pub Incorporated. 2007. 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