Marketing Strategy for MacBook Air - Example

Marketing Strategy Name Institution Executive Summary Apple Inc. continues to enjoy competitive advantage due to the nature of its products and services. MacBook Air, an Apple product, has been experiencing increasing rates of competition from Microsoft Surface Pro. With the changing consumer behavior, tastes, and preferences, consumers are shifting into products that not only offer quality services but also ensure that their needs are met. It is from such background that the report focused on various marketing strategies. With the market segmentation and analysis of the 4Ps, Microsoft Surface Pro would meet the needs of the customers. There are several factors influencing consumer purchasing power including economic, socio-economic, and technological. The report recommends that to meet the specific needs of the customers, Microsoft Corporation needs to ensure that Microsoft Surface Pro has features that would enable it compete advantageously with others. Introduction Background to the Task With the rising levels of competition, businesses are keen on the marketing strategy used in creating a competitive advantage for their products in the market. It is important to note that not all marketing strategies used would create a sustainable competitive advantage. Moreover, the ever-changing behaviors of the consumers and purchasing are greatly influencing the type of marketing strategy used. While developing a marketing strategy, it is crucial to consider the prevailing consumer behavior in the market, clear definition of the target, political, technological, and socio-economic factors. Comparing the market and operational base of the Apple and Microsoft products, Apple Inc. has been enjoying the competitive advantage for a long time within the electronic industry. However, the market structure is changing, and more advanced products are coming into the market creating a stronger competition. Purpose of the Report Technology is advancing that most consumers find it convenient to use tablets rather than laptops considering portability and the level of convenience (Kim & Mauborgne, 2005). As a result, the report would be focusing on developing a marketing strategy that would boost the sales of Microsoft Surface Pro 3 against MacBook Air. Market segmentation plays an important role as a marketing strategy; however, it would more effective if incorporated into consumer behavior, perception on the product, and preferences. Although changing consumer taste and preference might not be easier, market segmentation would assist in identification of the areas within the product specifications that requires adjustment to meet the actual needs of the customers (Barney & Hesterly, 2006). The marketing strategy would be targeting the younger generation including the students and those in employment who require tablets for conveniences in terms of portability and easier usage. Description of the Target Consumer Understanding behaviors is the fundamental prerequisite for ensuring effective marketing strategy. Some business entities often create competitive advantages that to some extent are not sustainable. As a result, they attract more consumers within a short period, and finally the amounts of sales reduce indicating the fact that their marketing strategy did not consider consumer behaviors. The behaviors of the consumers change from time to time depending on the prevailing market conditions and the nature of the competitive advantage created by the business organizations. Technology is advancing that younger generations are on the forefront aligning their activities with the modern technology. Age determines the trend of purchase in every market structure (Chu & Keh, 2006). Moreover, consumers are looking for products that would allow them conduct their activities at their convenience, access information within a click of a button, and more importantly connect with others globally. Computers and tablets provide such functionalities with their abilities to provide such services. However, the prevailing economic conditions determine the purchase behavior of the consumers. Consumer analysis is crucial to all businesses as it helps in identifying the right customers, ascertains their needs, and specifies how the product would be satisfying their needs. Moreover, consumer analysis involves consideration of demographic profiles and behavioral analysis (Sheehan, 2011). According to consumer behavior theory, problems associated with consumer purchasing purchase power depend on the product, constraints, and decision variable. The product defines satisfaction level; constraints refer to the limited resources, and decision variable is referred to the quantities purchased by consumers using the limited resources. Analysis of Competitor Value Proposition and Marketing Mix Strategy With all the marketing plans and strategies used by the businesses, the aim is only to influence the decision of the consumers. It is the responsibility of the business entities to identify the factors influencing the consumer behavior to influence their decisions. Currently, many businesses are using social media and other accessible marketing platforms to reach the consumers (Ananthan, Appannaiah, & Reddy, 2010). All these methods of advertising the products are meant to increase brand awareness besides influencing the consumer purchasing power. Within the electronic industry, consumer purchase behaviors are influenced by simple specification differences among the competing products. For example, over the years of operation, Apple Inc. has been enjoying a competitive advantage due to the opportunity created by its initial products such as iPhones. Moreover, most people purchase their products since they want to be associated with fancy and expensive gadgets (Kotler & Keller, 2009). However, with the changing market structures and more electrical companies producing products that offer competition to Apple Inc., the behavior of most consumers have been able to change with customers going to subsidized products which perform similar functions as those produced by Apple. Prevailing economic conditions determines the purchasing power of the consumers. With lower employments rates and rising standards of living, there is less disposable income among the consumers. Therefore, while designing a marketing strategy, it is important to consider the amount of disposable income among the target groups before setting the prices of the products (Cahill, 2006). The younger generations who have been able to coin the modern way of communication, so, Surface Pro 3 offer a convenient way of receiving and replying messages and modern communication methods. Contrary to the MacBook Air, which is a laptop, it also offers a convenient method of conversing but not like the laptop. Although consumers use price and quality attributes while differentiating the competitive products, it is important to strike the balance between the two attributes while creating an effective marketing strategy aimed at influencing the behavior of the consumers. To some extent, consumers purchase products due to influence by others and readily available information (Cant, 2006). Therefore, market segmentation would assist in availing the information on the product to the consumers. Figure 1: Framework Consumer purchase behavior Value Propositions for both MacBook Air and Microsoft Surface Pro Over the years, Apple Inc. products have been enjoying strategic position within the market due to their quality products. Over the years, Apple has been using competitive advantage for almost all its products including its products including the MacBook. The company has been able to obtain a competitive advantage for its products by producing products that meets the expectation of the customers, highly skilled personnel, product availability, increased barriers for new entries, and improved technology. Moreover, the company has been able to provide better overall value products to the customers than the competitors, a factor that assisted in creating a competitive advantage. Quality is a prerequisite to attracting more customers; therefore, it is crucial to align to align the production process and the heartfelt needs of the customers (Levinson, Levinson & Levinson, 2007). In the company’s quest to develop a sustainable competitive advantage, MacBook presents consumers with the thinnest and lightest laptop available in the market making it more portable than others do. With such portability specification, the laptop would fit in the smallest gear bags for those consumers who like moving around. Although there are several windows hybrid systems used in the market, they still not meet the specifications for the MacBook Air due to their ineffective costs and use of Atom processors. Consequently, MacBook enjoys competitive advantage associated with its battery life over the other competitors. With an ability to run for more than ten hours, it offers users longer duration of usage especially while browsing in areas with no available electricity supply, thus reducing inconveniences associated with power failures. Additionally, the OS X offer the fastest processing of documents and have the ability to plow through without experiencing any hiccup. With the market becoming more competitive, the prices of Apple Inc. products have remained higher over the years; however, the company continues to produce quality products with maximum security from any hacking activity. The MacBook Air provides clients with greater benefits and services especially for heavy users, a factor that justifies the higher prices. Apple products have also received competitive advantage due to differentiation strategies (Kendrick, 2014). While designing MacBook Air, the company aimed at increasing the market demand for the product by making it unique and attractive to the consumers. Through differentiation, the company managed to create demand for the product and acquiring the power of over prices, innovative advertising, hype around launching of more related products, and ensuring brand loyalty. The company has been able to penetrate the market making it reach more client with the MacBook. It sells both its products and those of the third party in major markets directly to the consumers and small businesses through retail and online stores (Lawler, 2008). As a result, these sales methods offer indirect distribution channels to the consumers making the product available globally. Besides, the company uses the minimum advertise prices as its method of ensuring that the dealers of its products do not advertise below certain price limit. The company designed the product to create a better proposition for the clients, therefore, the features of MacBook Air aims to solve relevant issue touching the clients such as the weight, power durations, and numerous gadgets with no ability to multitask. The product is relevant to quantified value and differentiation. Through the years, the company has been position itself with specific types of customers, innovators, and those with distinct lifestyle. It is a perception that if Apple Inc. reduces the prices of its products to some affordable level to most people, and then the rich people would stop purchasing such items. The management of Apple products is geographically based (Fulmer & Conger, 2004). According to Porter’s theory, any strategic management used in improving the performance of the organization should aim at building and sustaining a competitive advantage. The value propositions used by the company such as the production of quality products, making the products readily available, and increased efficiency plays an important role while developing a marketing strategy. In most cases, businesses create unstainable competitive advantages due poor alignment of the products and costs with the needs of the customers. Proposed Marketing Strategy for MacBook Air Market segmentation Available information in the market about an existing product determines the number of sales. One way of marketing a product is to analyze the market and consider the segment of the market in which the product would experience more sales. Market segmentation is a marketing strategy that focuses on breaking the market into various segments and then centering all the marketing strategies on one or more segments. Proper market segmentation plays a key role in attracting new upcoming businesses and cushioning business success. By using target segmentation, it is easier to promote information on services offered by the institution in a more cost effective manner. Moreover, it focuses on all marketing aspects thus ensuring efficient and effective marketing strategy (Jones & Silverstein, 2009). Adopting market segmentation involves outlining business plans and reasons for its efforts to reach many clients. Consequently, this would ensure delivery of high-quality services meant to satisfy consumer expectations. Moreover, the strategy refers to an aggregation of prospective buyers into groups. Prospective buyers within an area would always have common needs, and their responses would be similar to the marketing action in place (Levinson & Levinson, 2013). Consumers continue to purchase products of higher prices while others remain without due to unavailable information. The main aim of conducting target market is to reach the customers in different geographical locations, determining the right cost of offering services, and relevant promotion techniques. For effective and successful target segmentation, it is significant to identify the market segment as the first step, choose the segment fitting organizational objectives, and finally developing marketing strategy, which appeals to the selected target segment (Click & Duening, 2005). The objectives of the target segment as a marketing strategy are to create awareness of the existence of services offered by Surface Pro in areas that it receives very less clients and to identify the best method of rendering the services to the customers. Generally, segmentation typically involves conducting a marketing research, which to some extent might be costly (Sen, 2008). The objective of market segmentation is to assist in designing a marketing mix that would precisely be in line with the expectations of the customers within the targeted segment. However, it is important to note that poor implementation of the strategy might lead to poor performance especially if the underlying factors are not taken into consideration. Therefore, it is important to clearly identify the market segment, measure its effective size, ensure that it is accessible through promotional efforts, and appropriate to organizational policies and resources (Frazier, 2008). Market segmentation is based on the characteristics of the customers, which include geographic, demographic, psychographic, and behavioristic. Geographic segmentation The amounts of sales experienced by Surface Pro tend to differ from one to another depending on the geographical location of the market. In every situation, from a business point, there are areas contributing more clients to a business than others. Geographic segmentation plays an important role especially for companies considering exploring international market (Thompson, Strickland, & Gamble, 2008). Therefore, there is need to develop marketing strategies that focus on increasing the number of clients and creating service awareness in areas indicating lower sales volume. Geographical target segment involves reaching the targeted group in their respective locality. Psychographic target segment Psychographic type of segmentation focuses on socio-economic class and lifestyle preferences. Economic factors like affluence and education and financial condition are some of the factors influencing psychographic target segment. While formulating a marketing strategy, it is important to consider the amount of disposable income. Moreover, it takes into consideration the activities, interests, and opinions of the consumers (Merrilees, 2007). Most of the people currently spend much of their time on the internet during leisure, with the slim design, affordability, and portability of the Surface Pro, the company would easily influence the desires of the customers. Psychographics are crucial to segmentation since they assist in identifying personal activities and the lifestyle of the target segments. Goals and objectives of the target segment as a marketing strategy 1. To increase the sales volume in areas with low sales return 2. To create awareness of the Surface Pro tablet existence in areas experiencing low sales 3. To identify the best channel of product distribution Marketing mix strategy for creating and delivering customer value Most businesses use marketing mix as a tool for marketing their products and services. The concept is significant while determining the brand of the product and in most cases it is associated with the 4Ps, which includes price, product, promotion, and place. An effective use of the 4ps would help in ensuring that the product lands in its right place within the market. Since the product is tangible, it would undergo the product life cycle, which the management could use in understanding and planning for various stages of challenges associated with the product include competition. Consumers need to understand the benefits associated with the product and its features (Vandervell, 2015). About the price, it is crucial that any marketing strategy considers the prices of products and services offered to the consumers. Even though the price of a product reflects is quality, it is important that the price of Surface Pro remains slightly lower to attract consumers from the diversified amount of income. The chosen price for a product, however, would greatly affect the profit margin, supply, demand, and marketing strategy. Furthermore, the product might as well be positioned based on the price (Paley, 2005). Availability of the product and price does not guarantee adequate sales; therefore, the business needs to focus on methods of promoting the products to increase the scope of sales (Karim, 2012). Since most consumers are not well conversant with Surface Pro, it would be important to invest in promotional activities like advertising, email marking, social media marketing, public relations, video, and search engine marketing. It is important that every touch point while promoting the product must be supported by adequately positioned features for true maximization of the return investment (Esty & Winston, 2006). In most cases, consumers talk of acquiring the right price, product, time, and place. It is significant then the company critically evaluates an ideal location to convert the potential clients into actual clients. Figure 2: Interaction between various components of 4Ps Justification of the Marketing Strategy Since the marketing strategy focused on different segmentation methods, it is clear that the factors influencing the purchasing behaviors of the consumers. Segmentation divides consumers into different groups depending on their knowledge, attitude, and rates of use, status of loyalty, responses, and readiness stage towards the product in question. Most people tend to purchase quite expensive products due to their positive attachments and belief on the product. However, with consideration of consumers’ behavior during segmentation, the company might change their purchasing power (Lieber, 2008). The marketing strategy would influence the lifestyle and behavior of the consumers. Other demographic variables such as social classes, age, gender, occupation, income, education level, and generation also play an important role in changing the behavior of the consumers. With the level of technology advancing and the use tablet gadgets has been on the rise especially among the youths. The benefits perceived might differ from one stage of life to another; as a result, demographic segmentation tends to divide the market into different life stages allowing tailoring of the information in an effective manner (Kalra & Soberman, 2010). Conclusion Satisfaction for the needs of the consumers is the major reason behind any marketing activities. However, marketing is quite difficult because preferences of the consumers tend to change from one geographical to another. Marketing entails understanding the needs of the consumers, ever-changing market trends, and the level of competition within the market. In most cases, consumers often consider the prevailing economic conditions before deciding to purchase particular products. Within a market structure, there could many producers manufacturing similar products. As a result, consumers are forced to choose from the existing products, which at the time might be difficult considering variability in their prices and quality. To influence consumer before, every marketing strategy must include the relevant information regarding the product in question and takes into consideration the factors that control the decisions made by the consumers. Consumers vary in terms of thoughts; feelings, and decisions, hence, marketers must pay attention to these factors. 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