Marketing and brand innovation: Apple Inc. case - Assignment Example

?Assignment Marketing Contents Contents 2 Answer 3 Answer 2 4 Answer 3 5 Reference List 7 Answer Innovation does not only constitute technically invented services and products, but consists of cultural, social and economies aspects as well. Innovation has evolved over age. During earlier days innovation was usually a one way pipeline. However as a result of the new complexities and whole new concept of innovation and creativity, innovation in today’s world is cross disciplinary which means innovation can be both forward and backward (Tidd and Bessant, 2009). Also, feedback has become an important aspect of the innovation process. In the present case study Apple used CIM or Cyclic Innovation Model for market and product oriented transactions so that the consumers can find the products and services exactly where they want. In the Cyclic Innovation Model, innovation can initiate anywhere. Change is inevitable and everything is constantly changing, backed by innovation. This is the basic principle of Cyclic Innovation Model. It can also be described as a technology-push method. For example, iTunes was invented by Apple Inc. in the year January 2001 and consumers started using this software for storing films and music. There was an opportunity of marketing portable music player which was tapped by Apple Inc. In order to utilize this opportunity Apple Inc. conducted an extensive market research and finally developed the iPod where consumers are able to access music files with the help of internet and even store them. iTunes became an invaluable link between services and products, identifying exactly what customers want. The services of iTunes made Apple Inc. find the exact requirement of consumers in the market. New product creation helped in transition of the market and helped the company in identification of the exact requirements of the consumers. This in turn encouraged further innovation within the organization. With the help of the Cyclic Innovation Model, the organization was able to create innovative services and products. The dimensions of innovation brought by Apple were multiple. For example, technical innovations in software such as Apple store and Hardware such as Retina Display, interaction design and virtual design innovation such as touch screen and gestures. In order to tap the market of music followers, the organization opted for channel innovation such as unique agreements with various music companies and providing creative store experiences to the consumers (Berkhout, Hartmann and Trott, 2010). The strategy for business innovation was Apple’s strong pricing and various partnerships with suppliers and tertiary service providers. The scientific research part of the innovation cycle was performed by data collection methods. It was also known as insights innovation where huge quantity of mobile data was flowing from consumers to the marketer. The differentiated service cycle was completed by marketing and brand innovation (Trott, 2012). Here, brand experience was inspirational and consumer used to wait for days before launch of new product and services. Many competitors still criticize Apple Inc. for introducing iPods at a low price even with huge number of innovative features. However, majority of them have been unable to provide a holistic product of their own and failed trying to replicate the service ecosystem that Apple has created with the help of Cyclic Innovation Model. Answer 2 Apple Inc. has seen a spectacular growth in its MP3 segment since 2003. However, fierce competition from all segments in the industry is giving a tough time to the company. Apple falls in consumer hardware and software industry, selling everything from PCs, laptops, mobiles, music and a host of consumer hardware. Thus, the risk of losing market share is from everywhere, especially when other organizations are able to access the technology. Loss of market share due to supplementary products such as music systems incorporated in mobiles is also huge. In the wake of these recent changes in the market, Apple has started to cut prices. Even though it is helping the firm to keep its share of market at level, profit margin has been decreased drastically. Apart from that rising competition from manufacturers like Sony, Dell etc is giving a tough time to the organization. It is inevitable that with the upgrades of technology and its easy availability, competition is set to become fierce. In order to keep the market share of iPod intact, Apple Inc. will have to ensure that its target customers are always satisfied with the product. The company can keep upgrading its iPod models in order to provide its customers with better experiences. The company can also establish strategies for sales such as exchange offers or special discount for customers who have purchased Apple iPods more than twice. Another strategic option which Apple Inc. can take is patenting its innovation. Few of the iPod models and designs, which are a bestseller among target consumers, can be patented. This will help in keeping the consumer base intact and help in minimizing loss of market share (Baker and Hart, 2007). While it is difficult to estimate the future of Apple iPod, it is still one of the first choices for music lovers and tech-savvy consumers. Also, the brand name of Apple and its brand equity will definitely keep drawing consumers towards the Apple store. Answer 3 In the present business environment competition is certain and only organisations with definite goals are able to survive. Creating partnerships with other organizations is the popular trend in order to survive in the current market and expanding into new ones (Haberberg and Rieple, 2008). As a result of the availability of technology and increasing competition, pressure mounts and organisations prefer to enter into strategic alliances. These alliances are basically formed by combining various activities of supply and value chain of at least two firms whose objectives and structure are compatible. This is important so that sustainable competitive advantage can be achieved. During strategic partnerships, companies work together in order to achieve objectives which are mutually beneficial. It also requires sharing of information, resources, risks and capabilities so that the mutual objective can be achieved. Apple has been involved in many strategic alliances in the past. Apple Inc. has partnered with companies like Motorola, Sony, AT&T and Phillips in the past. Apple Inc. also jointly collaborated with Clear Well through a strategic partnership where an E-discovery platform was developed. These platform and entities in general are used by legal entities and enterprises in order to obtain information and documents in a legal and defensive manner. From the case study it is clear that the major reason for the sudden fall in the Apple market share was licensing. Apple’s tiff rival Microsoft had licensed its operating system to the PC manufacturers while Apple was against it. In order to ensure that Apple remains a dominant force in the MP3 and cell phone segment, the organization will have to do more than just innovation. The company will have to take strategic steps in order to ensure leadership and continuation of brand awareness among consumers. Marketing managers from Apple Inc. need to develop marketing communication plan in order to generate the brand awareness regarding the MP3 players and their cell phone brands among target segments. In the initial stage, marketing managers should bank on cost saving feature of the application in order to avoid the scope for creation of cognitive dissonance regarding benefits of information availability or design of the Apple products among its current as well as potential customers (Adams, Bessant and Phelps, 2006). Price differentiation is the most significant way for marketers of latest technological applications to attract customers (Bizer and Petty, 2002). Hence, marketing managers should use low price of ion new models of MP3s and cell phones as unique selling point (USP) to attract customers. Thus with the help of strategic innovation the organisation can position itself in new target markets as well as among new customers (Johnston and Bate, 2003). Few of the other strategies which the organization can utilize are strategy for co-creation, strategy of future research, knowledge based research, innovation strategy involving risk and strategy offering platforms. Reference List Adams, R., Bessant, J. and Phelps, R., 2006. Innovation management measurement: A review. International Journal of Management Reviews, 8(1), pp. 21-47. Baker, M. and Hart, S., 2007. Product strategy and management. New Jersey: Prentice Hall/Pearson. Berkhout, G., Hartmann, D. and Trott, P., 2010. Connecting technological capabilities with market needs using a cyclic innovation model. R&D Management, 40(5), pp. 474 - 490. Bizer, G. Y. and Petty, R. E., 2002. An implicit measure of price perception: Exploring the odd-pricing effect. Advances in Consumer Research, 29, pp. 220-221. Haberberg, A. and Rieple, A., 2008. Strategic Management. Oxford University Press, New York. Johnston, R.E. and Bate, J.D., 2003. The power of strategy innovation: A new way of linking creativity and strategic planning to discover great business opportunities. American Management Association, New York. Tidd, J. and Bessant, J., 2009. Managing innovation: Integrating technological, market and organizational change. New Jersey: John Wiley & Sons. Trott, P., 2012. Innovation management and new product development. New Jersey: Prentice Hall/Pearson. Read More