The Internal Marketing Environment of Apple Inc - Essay Example

? Marketing Audit The Marketing Audit "A marketing audit is a systematic, comprehensive examination of a firm's marketing organization, strategies, objectives, tactics, and activities. Apple’s marketing audit allows top management to discover the Apple's strengths and weaknesses in relation to threats and opportunities it faces in the marketplace, and identify more effective uses for the accessible marketing resources" (Wilson, 2005). The goal for Apple’s marketing audit is to outline the assessment of the current environment, customers, target market, competition, services, and marketing strategies to be utilized in developing a marketing audit plan for the firm. The approach, resources, and stages of undertaking Apple’s marketing audit will also be explained. "The Apple’s marketing audit will be utilized as a fundamental tool of the firm marketing planning process. Apple’s Marketing audit can not only be carried out at the initial stage of the firm audit process, but also at a sequence of points throughout the implementation of the plan. This audit will consider both external and internal influences on marketing planning, as well as reviewing of the plan itself” (Crompton & Lamb, 2011). Apple’s marketing audit plan will be utilized to make the sales 0bjectives outlined in the firm business plan a reality in the year 2013. The marketing audit has specific similarities to a financial audit in that it is a review the Apple's existing marketing activities. Carrying out the marketing audit offers the opportunity to review and appraise the firm's whole marketing activity, allowing the firm to evaluate present and the past performance as well as to offer the basis for assessing probable future course of action. Since Apple’s marketing environment is ever changing, the marketing audit needs to be utilized as a reference tool, with consistent updates corresponding to changes in the external environment and Apple own internal operational experiences (Crompton & Lamb, 2011). 1. The Internal Marketing Environment Marketing Mix The marketing mix is one of the main most famous internal marketing environment terms. Apple’s marketing mix is the operational and tactical part of the firm marketing plan. The marketing mix is also called the 7Ps. The Apple’s Ps is place, product, price, promotion, people, physical evidence and process (Webster, 1992). Product is defined as the combination of goods and services the firm offers to the target market. Apple products are simply the physical, tangible items that the firm offers in the market. A product can also be the product as intangible in terms of a service. Apple’s have a variety of well designed and quality products that have always given the firm a very high competitive advantage (Webster, 1992). According to Webster, (1992) Price is the amount the customers must exchange to receive the product or service. Apple’s goal in terms of price is actually to reduce costs through enhancing efficiency in manufacturing, and most significantly the marketer requirement to increase the perceived value of the benefits of its services and products to the customer. Place includes firm activities that make the product accessible to target consumers. Apple’s place is as well known as distribution channel, or intermediary. It is the machinery through which Apple’s goods and services are transferred from its manufacturing or service premises to the consumer (Kotler and Armstrong, 2010). According to Kotler and Armstrong, (2010).Promotion comprise of all of the activities marketers carry out to inform customers about their products and services to encourage customers to buy these products and services. Apple’s promotional review comprises of all the tools assessable to the marketer for marketing communication. There is no absolute agreement in the firm on the particular content of a marketing communications mix, for Apple there are several promotions components that are often comprised of aspects such as advertising, sales, sales promotion, direct marketing, public relations, personal selling and online communications. People are all human attributes which play a role in service delivery and therefore influence the buyers' perceptions; termed as the customers, firm's personnel, and other consumers in the service environment. For Apple people are the most significant component of any firm’s experience or service. Apple’s services are manufactured and consumed at the same time (Zeithaml et al, 2008). Process is the actual mechanisms, procedures, and flow of tasks by which the service is delivered; this is an operating system for service delivery (Changchien & Lin, 2005). There are several perceptions of the process concept within Apple’s marketing literature. Apple’s individuals see processes as a mode to achieve an outcome. However in real life it is more about the consumer interface between the Apple and its consumer and how they deal with each other in a sequence of steps in stages throughout the process. Physical evidence is the environment where the service is delivered, and where the company and customer interact, and any tangible element that facilitates communication or performance of the service (Changchien & Lin, 2005). Apple’s physical evidence is the material component of its service. Honestly there are no physical attributes attached to Apple’s service, thus a consumer tends to depend on firm material cues. There are several examples of physical evidence in this firm, comprising of the following buildings, signs, equipment and logos, business reports and annual accounts, your website, brochures and the Apple’s business cards. 2. The External Marketing Environment When doing a marketing audit, Apple analyzed its external factors that influence the its operations and the overall running of Apple’s business either in its present location or in any other firm positions where Apple have franchises. Apple’s external marketing environment is at three broad levels; its economic environment, its competitive environment and one of Apple’s own marketing environments (Rothe, Harvey, & Jackson, 1997). I. Apple’s Economic Environment a. Political Businesses and organizations could introduce a risk factor that is determined by the politics of a country making them to suffer some loss. The actions and policies of a government could change anytime and Apple therefore needs to be prepared for these eventualities. The government could change its regulations and this could affect Apple business in terms of taxes. Managing political risk is therefore important and Apple has considered buying political risk insurance. Organizations that have international bases use this type of insurance to alleviate their risk coverage that result from political instability. There are indices revealing the risk exposure that Apple can face in specific countries. b. Economic Economic environment is multifaceted and it continues to change according to policy changes, and the prevailing political situations. This affects the types and capacity of employment that in turn reflects the general economic growth and inflation rates and general Apple’s Income levels (Clark, 1999). It has mainly five main components:- 1. Economic Conditions - any change in the standard of living, trends of supply and demand, purchasing power of public, distribution of income etc. greatly influences the size of Apple’s market. 2. Economic System – the framework of rules incentives that define the economic relations. An economic system of a Apple’s operational environment in a country could be; capitalism, socialism, democratic socialism, totalitarian socialism or a mixed economy. 3. Economic Policies – the Government may give subsidies to one sector of businesses as opposed to others and this may not have favorable conditions for Apple’s businesses. It may decrease Apple’s rates of excise or custom duty or tax rates. 4. International Economic Environment - The functions of economic environment in international businesses is increasing. Apple which is involved in foreign trade, then it is determined of affected not only by the economy of its own country but by that of the country in which it is operational, whether exporting or importing goods (Capella & Sekely, 1978). 5. Economic Legislations - Governments come up with and design legislations which Regulates and control the businesses that are operational as well as new establishments this needs to be handle by Apple in the right way otherwise it will affect its operations (Changchien & Lin, 2005). C. Social and Cultural Includes the demographics (population growth/distribution, age), cultural and lifestyles values (changing beliefs, skills, family values). Human resources - patterns of employment and working conditions in the society largely determines Apple’s business. The flexibility in employment patterns and approaches of people to careers direct Apple’s operations. Apple should plan for changes is the social environment (Wilson & Gilligan, 2012). Marketing - the demand of a product in the society informs Apple’s product distribution and consumption patterns. Doing market research helps Apple in knowing its demands and purchasing power of their customers (Wilson & Gilligan, 2012). Production – determining the size and impact of production in the global economy is vital in Apple’s market planning. Apple should ensure that their production is positive and meets the desired requirements (Wilson & Gilligan, 2012). D. Technological - IT, internet, home shopping With the advent of internet and diverse social media and applications, technology is changing at a rapid rate and Apple should consider this in its marketing audit as a very important factor (Changchien & Lin, 2005). E. Environmental All businesses are now “going green.” Apple’s market audit should consider innovative ways of conservation of nature and promotion of environmentally friendly products (Changchien & Lin, 2005). II. Apple’s Competitive Environment Apple competitive environment is very important for its business. Consider factors such as; new entrants in a similar industry like yours, the bargaining power of consumers, substituted products, distribution patterns and your marketing strategies. Apple’s marketing audit should use this data to inform the firm’s plans. Apple needs to focus on any strengths and weakness both internally and from its external competition (Jobber, 1995). III. Apple’s Market Environment When establishing and creating franchises for Apple business, top management have to know the actual market size, and the growth and trends of products and prices prevailing in the market. Check the industry practices and create Apple’s own feasibility to an existing environment (Cram, 1995). 3. Apple’s Marketing Plan Apple marketing plans on satisfying individual consumer demands than merely fulfilling demographic needs as well as, improving stability and performance rather than introducing new attributes when releasing new versions of any product (Jobber, 1995). The iPhone targets customers who need to store data and communicate or individuals who want entertainment on the go. Apples target segments consist of students, corporate users, professionals, entrepreneurs, and health care employees. Presently, the market for high-end phones such as the Apple iPhone is small. Few individuals want Internet, video, and PDA features. The smart phone market is still small as compared with broad phone market. The market will increase rapidly in coming years because of lower prices and greater purchasing power (Jobber, 1995). Situational Analysis Political Situation Taxation is one thing that governments impose and Apple should research on this as country by country situation to anticipate pricing and profitability strategy. Economical Situation Economical growth globally is in a huge recession which requires careful manipulation. Potentiality of the market is reducing but it is higher than any others in the Telecom sector. Socio-Cultural Situation Population growth resulting to expansion of the sector needs for mobile phones. Individuals depend majorly on mobile communication everywhere. Culture’s perception related to technological devices is positive globally. Technological Situation Level of technology worldwide is increasing. Internet point of awareness and usage for individuals and industrial perspective are increasing globally. New technologies in the mobile phones are increasing. Future plans for technological connection between universities, cities, hospitals, colleges, and other institutes are increasing and can be linked to mobile phones. Level of utilization of the E- Technology is high and trendy. Environmental Situation The global concern of the pollution effects and Global Warming issue concerning the packaging material and radiation of the mobile phones is alarming. The demand of the global environmental approvals is a must. SWOT Analysis Strengths Innovative-The Apple iPhone has an innovative touch screen. It also has several functions of other mobile products all in a single device Compatibility –The iPhone will work with iTunes and with other Apple products and Operating System software tools which shows limit less potential for upgradeability. Brand awareness and Quality - Apple is well known for good quality essential gadgets like the iPods along sophisticated technological innovations like the original Macintosh Opportunities Increasing demand and expansion to a new target segment –As technology improves and smart phones get cheaper Apple will attract consumers and get iPod users to upgrade to iPhones. Upgradeable – iPhone software allows new exciting features to be brought in which take advantage of the touch screen ability (Jobber, 1995). Future versions will also be hardware upgradeable Partnerships – Apple can collaborate with many powerful global mobile phone companies to flood the market with iPhones, which reduces costs in marketing and increases revenue through long-term agreement deals (Jobber, 1995). Weaknesses Image – The Apple brand is not targeted towards business individuals and does not have a reputation as being compatible with the corporate world (Jobber, 1995). Price – Apple does not yet offer lower priced models for more cost conscious consumers. Threats Increased competition – Smart phones are easier to make now more than ever. More firms may enter the market, and competitors or even Apple contractors can maneuver around patents to create similar devices. Downward pricing pressure – The iPhone is marketed as a high end phone, but phone prices are almost certainly going to fall when other companies undercut the price of iPhones. Difficulty expanding into Asian market – There is less hype and interest in Asia since smart phones are better known and already widely used (Jobber, 1995). References Koetler, P. & Armstrong, G. (2010). Principles of Marketing. New York, NY: Prentice Hall Rothe, J. T., Harvey, M. G., & Jackson, C. E. (1997). The marketing audit: five decades later. Journal of Marketing Theory and practice, 1-16. Cram, L. (1995). The Marketing Audit: Baseline for Action. Library trends, 43(3), 326-48. Clark, B. H. (1999). 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