Apple iPodApple iPod

Brief HistoryBrief History Established in 1976 by

Steve Jobs and Steve Wozniak in California

For funding Wozniak sold his Hewlett Packard scientific calculator

Raised a net start of $1300

Apple delivered the first Apple I to hobbyists

Apple quickly earned $774,000

Corporate StrategyCorporate Strategy

Apple Inc. is a company that is vertically integrated, designing its own operating systems software and hardware, and selling these products through its own retail stores

To retain an edge in the highly competitive personal computer and consumer electronics markets, Apple’s stated philosophy is to increase investments in research and development, as well as marketing and advertising to extend market position

RecommendationsRecommendations

Competitive prices due to established name Expand in the foreign market (France,

Canada) Research and Development for new product

areas. Competing companies have nearly doubled Apple

in advertising Expand into user generated videos (YouTube,

Soapbox) YouTube earned over $90 Billion in advertising

revenue.

Marketing StrategyMarketing Strategy

Committed to bringing the best portable music device and mobile communication experience for people of all ages

Innovative product designs and styles Adhere to customer preferences in size,

capacity, and weight

Target MarketTarget Market

Primary Target Market: Teens and Young Adults to age 29

Secondary Target Market: Adults ages 30+

RecommendationsRecommendations

Learning tool for kids (alliance with school) Expand with other brands (like Nike and

Starbucks) Travelers (airplanes, boats, cars) Spend more on advertising (radio) Working with car companies for satellite

radio connections Change style and colors to work with

customers expectations

CompetitorsCompetitors

Zune (Microsoft) – send music and videos to others, personalized background pictures, radio

Zen Vision (Creative) – personal organizer, recorder, more song storage, more hours of video, and radio.

Sandisk Sansa View – lighter and smaller, microSD expansion slot, radio, and recorder.

DRM issue Not compatible with other players. Sued over issue.

Product and Pricing Product and Pricing StrategiesStrategies

Product Pricing

Product – iPod Touch; Product differentiation with a

3.5 inch widescreen 8 mm thin Multi-Touch screen,Wi-Fi

wireless technology Internet access Movies and music stores Reference tools - entering

maturity stage in the life cycle

Focus on uniqueness of Apple’s products to create brand equity

Price – 8GB - $299.99 16GB $399.99 32GB $499.99 – Price is inelastic due to

brand loyalty and quality of products, less sensitive

Perceived-Value Pricing, by delivering quality to the customer

Offer refurbished ones for discounted prices (make it known)

Placement and Promotion Placement and Promotion StrategiesStrategies

Placement Promotion

Online, in-store resellers Focus on establishing

more Apple stores Maintain competitive

advantage with multiple distribution channels

Acquire constant feedback from customers

television, radio, magazines, print ads

Offer sales promotions to repeat customers

Questions or CommentsQuestions or Comments