Apple Computers Marketing Plan

Pages: 10 (3133 words)  ·  Bibliography Sources: 10  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business - Advertising

Apple is a marketer of computers and other personal electronics. The company has been highly successful of late. It utilizes a strategy based around innovation and differentiation. The company has a number of key strengths, including a strong brand, a rock solid balance sheet and a culture that supports innovation. There are strong growth opportunities -- overseas, domestically and perhaps in tablets. Competition is the main threat to Apple.

The company's current marketing strategy is generally strong. The brand value has improved substantially in recent years, as has the market share of Apple's core products. The company is increasing its marketing budget. It is recommended that some price adjustments are made in order to make Apple products more competitive. It is also recommended that Apple focus its promotional message on strengthening the brand and increasing its international appeal rather than on building brand recognition. The key success measures are market share, revenues, profits and first-year sales of the iPad.

Company Description

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Apple Inc. is a designer, manufacturer and marketer of a consumer electronic products personal computers, mp3 players, portable devices, and software. The company sells its products through multiple channels, including a direct sales force and online stores. The company recorded sales in the past twelve months of $46.7 billion and a profit of $9.4 billion. In contrast to most other computer manufacturers, Apple products are embedded with proprietary software. The company has enjoyed tremendous success in recent years, with a number of hit product introductions that have driven revenue, including the iPod and the iPhone.

Strategic Focus

Marketing Plan on Apple Computers Assignment

The strategic focus on Apple is to develop its market share in a variety of personal electronic products. The company is also geographically focused, emphasizing major Western markets. The personal computing industry is characterized by a lack of differentiation among products, such that commoditization and price competition are common. Apple has sought to differentiate its products through marketing, brand building and proprietary software. In the company's other major markets -- portable devices, mp3 players -- there are fewer competitors and greater differentiation among competitors. Apple maintains, however, its strategy of differentiation.

Mission/Vision

Apple's mission statement is as follows:

"Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Today, Apple continues to lead the industry in innovation with its award-winning computers, OS X operating system and iLife and professional applications. Apple is also spearheading the digital media revolution with its iPod portable music and video players and iTunes online store, and has entered the mobile phone market with its revolutionary iPhone."

Source: Apple.com

The company does not have a stated vision statement. The mission statement provides little indication of any coherent mission. There are references to innovation, which is a key driver in the industry, but all the elements of the mission statement are past-looking rather than forward and read like a marketing press release compared to most corporate mission statements. The lack of clarity and directness of this mission statement provides little guidance for the employees of the company with respect to what, precisely, they are aiming for in the future.

Goals

Apple has a number of tactical and strategic goals, as mentioned in their latest 10-K. The company has launched a new product in recent weeks, the iPad, with considerable fanfare, hoping to create momentum in a tablet computer space that has yet to resonate with consumers. Apple is increasing its marketing investment overall in the hopes of driving product and brand awareness. The company is investing in programs to enhance reseller sales. Apple invests heavily in research and development, a function of the rapid pace of technological change and the company's desire to lead this change. The company does not specify financial goals but a reasonable observer would contend that it hopes the introduction of the iPad will drive revenues and the rate of revenue growth higher in 2010 than in the past few years. The company enjoyed strong performance in the past few years, but with a splashy new product launch they are hoping to create a new segment, fuelling strong growth in a category relatively devoid of serious competition.

Core Competency and Sustainable Competitive Advantage

Apple's recent success has been driven but multiple core competencies, some of which have lead to sustainable competitive advantage. The two most important competencies are in product development and in brand development. Historically, the company's success has been predicated on its ability to introduce new products that resonate with consumers. In the past ten years, Apple has introduced a string of such products, spurring tremendous growth. The ability to continually introduce new products and breathe life into moribund product categories has allowed Apple to not only gain market share but to create it.

Apple's brand development has been spectacular, in particular in recent years. Apple has been able to successfully differentiate itself from other computer manufacturers, enabling it to charge premium prices for its products. The company's other core products -- the iPod and iPhone in particular -- also have a high degree of differentiation, owing to the strong branding of the company. Apple's brand value drives business to the entire family of products that it creates -- the owner of one Apple product is likely to be the owner of multiple Apple products. The company has been rated as the #20 brand in the world, with a brand value of $15.4 billion. The brand is considered to be "one of the most iconic young brands in the world" (Interbrand, 2009).

The brand is the single greatest source of sustainable competitive advantage for Apple. The brand has a high positive image among consumers, and is widely recognized in the company's core markets. The Apple brand alone can drive sales and create hype. It is worth noting, however, that while the brand is powerful, Apple competes against many other powerful brands as well. Microsoft ranks higher than Apple in the brand value survey, and a competing brand like Blackberry is also in the survey. The company's innovation has been sustained for several years, but cannot be considered to be a source of sustainable competitive advantage. Other firms can imitate or better Apple's product innovation ability. In addition, Apple could lose its innovation ability with the defection of key talent and the erosion of leadership. While this competitive advantage is long-lasting, history has shown that at Apple innovation also fluctuates depending on the company's personnel.

Situation Analysis

Apple is currently enjoying a strong current run of success. The company did not face adverse consequences as the result of the economic downturn, becoming a stock market superstar as a result. Revenues have increased rapidly in the past few years, from $13.9 billion in 2005 to $42.9 billion in 2009. Net income has also increased over that time, from $1.3 billion to $8.2 billion.

The company is engaged in intense competition in all of its product lines, save for the new iPad. In computing, the company battles several major brands, most of which have a low degree of product differentiation but also have a lower cost structure than does Apple. In mp3 players, Apple dominates the market. The iPhone competes against the Blackberry and Palm, although financial difficulty at the latter company could mark significant restructuring of that market.

The company's operating environment is difficult, but its brand value and rate of innovation have allowed it to thrive where others have found difficulty. Apple is expected to continue its run of success for the coming years, as its stock is priced at a multiple of 24.14, suggesting that the market predicts strong steady growth in the future for the company (MSN Moneycentral, 2010).

SWOT Analysis

Apple has many strengths from which to draw. The first is innovation. The new product innovations have made the company the envy of many executives (Berglass, 2010) but its marketing and distribution innovations have also helped to foster a unique brand awareness and culture. Innovation at Apple is fostered by design thinking -- where design takes on a critical aspect of the product development process; product development strategy, where innovation becomes a key objective of the company; the CEO as chief innovator, where the inspiration for innovation comes from the top down; and bold business experimentation, where the company is willing to tackle markets that other companies have dismissed (Thomke & Feinberg, 2009).

Brand power is another key strength at Apple. The company operates in the premium segment of its chosen markets, using a differentiated strategy. Apple prices above the level of the competition, and its brand allows it to do this. The brand personality is focused on lifestyle, rather than product, and about simplicity and a connection with customers (Marketing Minds, 2008).

Apple also has considerable financial strength. The company's recent run of success has increased its earnings per share from $1.64 in 2005 to $9.22 in 2009. As a result of this success, Apple has an impeccable balance sheet. The company has $23.4 billion in… [END OF PREVIEW] . . . READ MORE

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