Marketing Strategy - iPhone 6 - Case Study Example

MARKETING STRATEGY-iPhone 6 Student’s name Institution’s Affiliation Course +Code Professor’s name Date Marketing Strategy-iPhone Introduction Organizations must formulate marketing strategies that will give them competitive advantages in the market and ensure that they position their products as the best option. Imperatively, such organizations, especially in the information communication technology industry must understand the market forces for sustainable growth and market capitalization (Kim et al. 2012). The smart phone market continues to grow and multinationals like Apple Inc. continue to design products that meet market demands, needs and preferences to stay ahead of the rest. In this report, the paper comment on the marketing strategy of iPhone 6. The report gives company background of Apple Inc., the product description of iPhone 6 and its target market. Furthermore, it details its marketing strategy and makes some recommendations in its conclusion. I. Background to Apple Inc Apple was founded in a garage by two friends, Steve Jobs and Wozniak in 1976. The two started by selling circuit boards that they produced before introducing an 8-bit functional computer called Apple II a year later. Apple II was considered as one of the highly successful commercially produced microcomputer in the market (Yeung 2016). Apple then diversified into other products. Between 1983 and 1996, the organization created some of the most innovative and astonishing products like Page Maker and Laser Writer. Steve Jobs would leave the organization for some years after disagreeing with some of his colleagues (Sun 2014). However, his return at the giant tech firm transformed the world of mobile phones as we know it today. Apple increased its product line, emerging as an innovative and influential international technology organization. The company introduced iPod in 2001 and iTune (Yeung 2016). However, the company played an important part in ushering in the era of smart phones and tablets in 2007 and 2010 respectively, with its iPhone 6 model. Product description of iPhone 6 Apple’s iPhone was introduced to the market in 2007 as a multimedia smart phone. iPhone 6 started after Steve Jobs had asked engineers at the giant tech firm to explore the touch screen technology. From its initial launch in 2007, Apple has released six different models of iPhone, with iPhone 6 being launched in 2014 (Le & Truong 2014). Apple Inc. competes with itself to create higher scale products. With a large screen size and internal modification, the iPhone is the organization’s flagship product. The device has features of a mobile phone, music player, small personal organizer and personal computing (Arruda-Filho, Cabusas &Dholakia 2010). Additionally, it has a widescreen display and multi-touch screen. The product has many firsts compared to its competition. It has iOS 8 operating system that enables it to run applications at higher speeds than its rival brands. Another unique feature is iPhone’s interface that is friendly, simple, and attractive (Yeung 2016). Again, iPhone6 is fully in sync with both Apple computers and software and the online applications. The phone has a one-click-sync for computers using Microsoft operating system. Effectively, iPhone 6 comes out as a multi duty communication tool with the capability to satisfy customer needs (Le & Truong 2014). Therefore, it is a mobile phone, a personal organizer, a music player, a mobile computer, and a portable Wi-Fi device. II. Target Market Apple Inc. was not associated with mobile phone manufacturing until the return of Steve Jobs. When Jobs returned, he asked engineers at the organization to explore the working of touch screen on mobile phones. Apple was largely associated with computers and portable music player (Le & Truong 2014). The production of mobile handsets was a new thing and the organization had to use a familiar firm in the communication industry to roll out its first handsets. For instance, US consumers had to get their first iPhones through AT& T mobile Communication Company in June 2007 after Apple had launched it. To penetrate the market, Apple targets three pillars convenience, entertainment, and staying connected. Under convenience, the iPhone 6 market targets male customers aged between 25 and 54 years because they earn higher salaries and multi task because of the nature of their work and social engagements (West & Mace 2010). Under entertainment, it targets younger consumers, both male and female aged between eighteen to twenty-five years. This group is educated and is considered trendsetters and has budgeting skills. The third target segment for iPhone 6 consists of those who want to stay connected and comprises mainly of female consumers. These individuals are tech savvy, hold family valuable and aged between twenty to forty years. Therefore, it is factual that Apple’s iPhone 6 targets teenagers, corporate executives and entrepreneurs as the main segments (Le & Truong 2014). iPhone’s Unique Selling Proposition The unique selling point of Apple iPhone is not in the advertising message but the various functions that it offers to its customers. These include innovation, customization, personalization, connectivity and storage (Yeung 2016). Through innovation, iPhone 6 is considered a groundbreaking phone that enables big screen browsing and navigation icons that include a QWERTY keyboard when needed. Customization is based on a customer’s desire (Kozinets etal. 2010). The customization is the USP aspect that the organization sells in its marketing plan. Customers can develop apps that enable them to start, follow, and stay connected through the use of third party software. Personalization is enhanced through the simple and effortless synchronization with other applications like phone book, calendar and email (Arruda-Filho, Cabusas &Dholakia 2010) III. iPhone’s Marketing Strategy Product strategy is at the core of Apple’s marketing strategy. Additionally, the strategy has created competitive advantage at the company and its flagship brands like iPhone, iPad, iTunes, and iPod. iPhone continues to be popular because it is user friendly and highly intuitive (Le & Truong 2014). Despite its simplicity, it also provides premium user experience through its innovative features and design considerations (Hernandez, & GuoHua 2011). Apple employs a retroactive and proactive approach in its product strategy. The company develops its products based on the existing ones from its competitors but improves by doing away with undesirable attributes and qualities by integrating different features (Yeung 2016). SWOT Analysis of iPhone 6 Strengths The highly and advanced technological features make iPhone 6 the most admired and powerful brand in the mobile phone market. Brand equity is strength for iPhone 6 as Apple is one of the most respected brands in the world. Thirdly, the innovation tag associated with Apple makes iPhone 6popular as consumers associate it with quality (Le & Truong 2014). Fourthly, consumer loyalty as iPhone 6 customers will proudly proclaim that they have an Apple product. It has amazing software and OS with an addictive user interface. iPhone 6, just like all models of iPhones, enjoys design consistency as the it is similar in features to the earlier models. Weaknesses of iPhone 6 One of the weaknesses of the device is its premium price that makes it difficult for many consumers to buy. Apple’s iPhone is more expensive than other brands with similar features. Secondly, its iOS is regarded as more restrictive than its Android competitors in the market. Effectively, it does not give freedom to its users, for instance, Bluetooth and USB interface. Thirdly, Apple’s iPhone 6 is very consistent on design (Hernandez, & GuoHua 2011). However, such a point makes it unpopular among other segments of the market, especially those who want changes. These segments fail to get the variety they expect from the phone. Again, its size makes it impractical since its large size and smooth metallic edges makes it difficult to hold. It also makes texting difficult and many users are prone to dropping the device. Other users contend that the phone is easy to bend because of its thin width. The channel of distribution is also another weakness as consumers find it difficult to get iPhones in many stores, especially in emerging markets (Boehner & Gold 2015). Opportunities for iPhone 6 Firstly, there is a market potential for smart phones due to the increasing demand from emerging markets like China, Brazil, South Africa and India among others. Therefore, Apple’s iPhone 6 can get more customers in these markets because of an expanding middle-class and a growing young population that are the main target markets. Secondly, continued and sustainable technological advancement also provides another opportunity to deliver more unique models and designs for the smart phone users (Hernandez, & GuoHua 2011). Thirdly, increased dependency on digital technology is an opportunity for iPhone 6 to penetrate in more market as more and more people become addicted to the Internet and mobile phones and applications. Fourthly, iPhone can seek geographical expansion in growing its market apart from its focus on the urban areas and certain segments of the market. Another opportunity is in the accessories market since it is never ending. More accessories will ensure that more consumers go for iPhone in the market. Threats Threats are mainly from competitors like Samsung, Microsoft, and Sony among other Android system manufacturers. Android system, developed by Google remains the biggest threat to iPhone. The Android system is projected to grow because it is a free application as compared to Apple’s IOS system used in iPhone models (West & Mace 2010). Secondly, the lack of innovation at the organization may work to lower trust level in iPhone, since it has taken the organization some time to come up with new products in the market, particularly after the death of Steve Jobs. Samsung products are a threat to iPhone since they offer similar features but are affordable, accessible, and available in most of the stores (Sun 2014). Marketing Mix Product Apple’s iPhone marketing mix shows that the organization matches its business activities to the market conditions (Boehner & Gold 2015). The first quality that people love about iPhone is the opportunity to access Apple iOS operating system therefore, iPhone gives consumers access to the operating system just as they would using a Mac book. Another feature of the iPhone is its high speed operating system that puts it above the competition. Again its hardware are compatible with Apple’s other products and OS, therefore allows smooth running of applications (Le & Truong 2014). The iPhone has more functional features that are similar to all Apple’s product, a situation that makes it most desired phone model in the smart phone market. Price Apple charges a premium price for its iPhone because of its market target and segment. Its product and promotional strategies are aimed at enhancing its skimming price strategy. The iPhone model has a higher price compared to other similar models in the market (Abraham 2013). However, Apple customers have no problem and remain loyal to the brand and their iPhone. Apple does not offer any discounts on iPhone purchases (Le & Truong 2014). However, discounts can be offered on sales promotions and exchange offers. Therefore, Apple maintains iPhone’s price across all its market. Imperatively, the premium pricing is part of the organization’s marketing strategy aimed at getting its market targets. Place and distribution The distribution of iPhone allows customers to access the product at locations or places that are convenient to them. iPhone is available in many nations an markets around the world. The organization also offers excellent backup services in these markets (Rahmani, Emamisaleh & Yadegari 2015). However, it targets premium customers, a situation that makes the phones to be found in world-class cities only. Apple’s iPhone stores are found in high-end places and malls. The I-store stores iPhones in these places for its premium customers. iPhone like other Apple products are distributed through an exclusive and limited channel aimed at a particular market segment. Apple distributes iPhone through its Apple stores, online store, authorized retailers, telecom organizations, and fulfillment services (Le & Truong 2014). Promotion Apple’s iPhone promotion activities emphasize the high-end image and quality of the product. The promotion mix allows the organization to reach its target buyers. Apple positions iPhone as a product associated with a high-end lifestyle and for a people who seek to protect their social status (Constantinides 2006). It uses pull promotion through ads on T.V, and running commercials in Cinemas, Magazines, its Website, and Social Media sites among others. Its push promotion includes having conferences when launching a product and key note address from the organization’s CEO and Board members (Danaher, Hardie & Putsis Jr 2001). Apple also uses personal selling and public relations to advertise iPhone. IV. Conclusion The products at Apple, including iPhone as relatively expensive compared to similar product in the market. However, as noted premium pricing is a marketing strategy used by Apple to target its market. Imperatively, iPhone 6 continues to lead in the smart phone because of its marketing strategy and unique selling proposition. Apple’s iPhone 6 is premium product that is desired by many consumers in the market. Therefore, Apple needs to ensure that the overriding obstacles based on its marketing strategy are addressed so as to maintain its brand image. Its pricing strategy is associated with exceptional reputation and quality. Effectively, iPhone 6 is positioned to maintain its market but Apple must expand the target market by formulating new marketing strategies. While targeting the premium buyers has paid off for the organization, innovation must be improved in the development of new products to counter competition from other phone makers like Samsung and Android developers like Google Inc. Finally, Apple’s iPhone 6 remains a most admired and a must have device as demonstrated by its target market’s demographics. References Abraham, S., 2013. 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