International Marketing Strategies of Apple Inc. and PepsiCo - Essay Example

International Marketing strategies of Apple Inc. and PepsiCo Introduction It is the aim of all business owners to succeed and become leaders in their particular specialties. Despite this, the tough reality is that there can only be one super brand of a particular product and whenever a company produces a top brand, they have to fight to retain the position. Competition is the characteristic of contemporary business operations whereby every brand does its best to usurp the rest as a way of staying afloat the market segment and exist for long. Another factor that determines the degree of a brand’s success is the degree at which it is able to deal with the challenges of globalization. The chief beneficiary of globalization is business, whereby companies now have the opportunity to spread their wings on a global scale an establish dynasties. For instance, since its inception many decades ago, Coca Cola has managed to be the number one soft drink brand in the world since it has established its name globally. For this reason, other companies want to succeed like Coca Cola. However, establishing a global brand is no mean fete. This requires noteworthy international marketing strategies so that a wide customer base is reached and is subsequently pleased with the product. This essay discusses the international marketing strategies of two global brands: PepsiCo (Pepsi) and Apple Inc. Discussion and Analysis Apple Inc. Most business managers recognize the importance of investing in services like social media and promotional methods like TV, radio, billboards, etc. This is because; a large market segment is reached at through these methods. The winner is usually the brand that invests heavily in these advertising mediums. Everyone appreciates the value of marketing brands as it is the sore ingredient to success. It is also important to note that the world’s best performers did not achieve this fete by marketing their brand on a shoe string budget. Advertisement on itself is an investment that will bring returns later when a large customer base is convinced about the brand. Apple Inc. is one such company that continues excelling in the target market segment due to intelligent marketing strategies on a global scale. While most companies have employed aggressive advertising, Apple has taken a different approach, and this has enabled it reap the benefits of intelligent advertising. Apple does not advertise its products on platforms like social media, radio, billboards, SEO or TV. Apple Inc. does not do promotions on its IPhones, and it does not have a budget for marketing. This strategy has propelled it to be a top electronics company, especially in mobile telephony. For instance, Apple uses other companies to run advertisements of its products for them. The company pays mobile phone networks to advertise their products for them, and this has turned out to be a clever venture. The network operators do their best to advertise the product since they will make a name for themselves that they sell iPhones. These operators will pay bills for the advertisement and being that the brand is Apple’s; there will be restrictions on what the ads will look like. For this reason, the ads of all Apple products usually look identical. One may wonder why mobile phone companies are spending a lot to advertise about a product that is not theirs and one where the branding guidelines are set for them. However, being that Apple is the world’s best-selling mobile phone company year after year, these companies will benefit from the “Apple pie” in the long run. The secret of Apple’s success lies in the marketing strategy. The company uses a strategy called the Exclusivity Technique. In this technique, a company gives select customers special deals on goods or services. For instance, certain offers will be exclusively available to some customers or fans on a social platform like Facebook or Twitter. Therefore, in this technique, a select subset of customers is made to feel special as a way of building a better relationship between the company and its customers. Apple uses this technique exclusively, and it has been found to enhance brand loyalty. Not only is this technique successful, but it is also low costing for a company of this magnitude. Therefore, instead of Apple making some offers exclusive, the company has managed to make their iPhone range of products exclusive. This has propelled its mobile phone to be the world’s most popular despite its exclusivity. In order to do this, Apple creates a restriction of flow in their iPhones to mobile phone companies and companies. For instance, when the first iPhone model came out, it was exclusively available to mobile phone providers for its entire lifespan. However, with subsequent iPhones, “stock problems” came up. For this, iPhones were sold to customers on a first come first serve mode. At one point, customers made long lines and camped outside Apple stores. As a result of this, there was media frenzy and this generated massive publicity for Apple. With time, the brand became famous and sales skyrocketed. Those who missed out on the product had to wait for weeks before another batch of products was released. These stock restrictions created tensions, and this became a topic of discussion online. This even ensured that people who had no interest about the product began discussing it. The device became a rare commodity which everyone had to have. Apple has continued to do this to date. For instance, this year, the number of iPhones released was limited in number as usual and some colors were in limited supply. For instance, the gold color was limited thereby creating a talking point, media attention and increasing the demand for the product. Apple’s Exclusivity Technique gives a feeling of specialness to those who have an Apple product and one of jealousy to those who lack the product. Therefore, this marketing strategy creates two groups in the market segment, which subsequently generates free publicity. For this reason, Apple products especially iPhones are a hot topics always and a must-have by many. Apple recognized early that instead of spending money of advertisements and bickering about its superiority to other brands, it can use an easy and cost-effective strategy. The advertisements are usually done for them by mobile phone companies and it uses customer tensions to increase demand and sales. Whether one loves the iPhone or does not, he/she will market the product through online debates. This will continue propelling Apple to even greater heights into the futures. Apple’s marketing strategy has enabled the company rise over the years. For instance, in 2003, the stock price was $7 and in 2007, it had risen to $180. This represents a 2500% increase in four years. By 2012, the stocks had reached $680, thereby overtaking giant companies like IBM, Microsoft and Shell. Between 2012 and 2013, the company was ranked 1st in stock market capitalization on Wall Street. Between 2003 and 2012, the company recorded an increase of 8000% in profits. Being that between these years, apple did not make any external acquisitions; the indication here is that much of these positive strides have been from Apple’s products and in-house ventures. Three products have accounted for 90% of this impressive growth in the recent past: iPhone (2007 to date), iPad (2010 to date) and the iPod. This simply illustrates how the company has used a potent marketing strategy to become a lead performer in the electronic business. In summary, the answer to Apple’s remarkable rise is in 4 tenets: excellent products, stellar brands, smart and unconventional marketing and communications. PepsiCo. Pepsi Company (PepsiCo.) is another global brand that continues performing well in the market segment due to noteworthy marketing strategies. Unlike Apple Inc., Pepsi lays emphasis on mass media advertisements and intense promotions as a way of making its brand famous and enhancing sales. To date, it comes second to Coca Cola in terms of the best beverage company in the world. This implies that for many reasons, Coca Cola has usurped Pepsi and it will take more and better strategies to ensure that it becomes the number one beverage company. Still, being a number two global brand is impressive and this is down to an effective and noteworthy marketing mix strategy by the management. Apart from being a leader in beverages, PepsiCo also produces food products, among other food related brands. PepsiCo has undertaken internal measures to ensure that it has advertisement practices that are effective and responsible. For instance, with the help of other corporations, PepsiCo founded the International Food and Beverage Alliance (IFBA). The IFBA regulates advertisements of foods and beverages to children below 12 years so that only the nutritionally appropriate beverages and foods are manufactured. By being consistent with global guidelines on advertisement and nutrition, this company gains more clients since they are glad that it cares about their needs and those of their children. PepsiCo realizes that apart from selling product to people, it has role of practicing food safety and high levels of sanitation products. Through nutritional labeling, the company ensures that its brand can be identifiable and traceable by all its clientele. Therefore, just like Apple Inc. realized that aggressive advertisement does not necessarily lead to market performance, PepsiCo. Also realized this and added other components to their advertisement strategy. Therefore, on top of advertising, the company includes nutritional labeling and safety on its products. To date, the company has reached 91% compliance in all global markets, and they are committed to 100% compliance in all global markets. This strategy has coincided with an upturn of events in the company’s fortunes in the recent past. The marketing strategy in the company, just like in apple Inc. is an internal one. In this strategy whereby, the changes for advertisement are done from internally and the effects reverberate on a global scale. Moreover, the company realized that as people buy snacks, they need a drink most of the time. And since customers began looking for healthy options, soda companies began losing customers. In order to counter this, the company purchased two of the largest bottling companies. With this, the company took control of over 80% of the bottling network, and with this, as people get healthy snacks, they get healthy drinks as well. Finally, PepsiCo began capitalizing on customer needs by giving customers products that they want. Therefore, as customers continue desiring healthy food options, the company focuses on this by coming up with foods that are healthy as the customers want. With this, the company continues growing. Conclusion The companies, Apple Inc. and PepsiCo illustrate how noteworthy marketing strategies build brands and increase the customer base. As Apple Inc. uses unconventional methods for marketing, PepsiCo focuses on pleasing customers and sticking as per the global guidelines on beverages and food brands. The two brands have further realized that aggressive marketing does not guarantee success. Instead, they study the market forces and make internal alterations. This, together with conventional advertising continues propelling these companies ahead. Works Cited Apple Branding Strategy. Retrieved from http://www.marketingminds.com.au/apple_branding_strategy.html Apple Marketing Strategy. Retrieved from http://www.vertygoteam.com/apple/apple_marketing_strategy.php PepsiCo. Marketing Strategy. Retrieved from http://isenbergmarketing.wordpress.com/2013/10/29/pepsico-marketing-strategy- by-paige-ryder/ Read More