Marketing Analysis for Apple Computers

7/22/2019 Marketing Analysis for Apple Computers

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Student ID: 1014955

Module Name: MNGT 7902

Assignment Title: Mid Term

Effective Number of Words Used: 2000 (Excluding Tables, Bibliography and Appendix)

I confirm that I have read the University regulations on plagiarism, and that this

assignment is my own work.



For this midterm you will critically analyze an organization (profit or nonprofit). Do NOT select any organizationthat we have discussed in class, such as Fiji Water or RKC. NOTE: YOU WILL USE THIS SAMEORGANIZATION AS THE BASIS OF YOUR FINAL PROJECT AS WELL, SO CHOOSE CAREFULLY. For each question, provide specific details and support your arguments with research. Your word limit for theentire exam is 2000 words, so do not waste words on marketing definitions or theories.

I. Introduction (10 points): Briefly describe your organization in one or two sentences, and its3BL policies and results (approximately 500 words).

II. Stakeholders Analysis (40 points): Critically analyze the stakeholders (approximately 1000words).

Customer Analysis: List the organization's target segments or customers, and describeONE in detail. Include BOTH quantitative details (size, financial data, etc.) and qualitativedetails (needs, habits, etc.).

Competitor Analysis: List the organization's competitors, and describe ONE in detail,including their strengths and weaknesses. (Do not analyze opportunities and threats — this is NOT a SWOT.)

Company Analysis: List the organization's key internal stakeholders, and describe ONE

in detail, including how they might influence the organization's marketing. Community Analysis: List the organization's significant external stakeholders, and

describe ONE in detail, including how they might influence the organization's marketing.

III. Brand + Positioning Analysis (40 points): This consists of 2 parts (approximately 500 wordscombined).

a) Critically analyze the organization’s brand in terms of 1. Appearance2. Personality3. And reputation.

b) Draw a positioning map with the organization, at least 2 customer segments, and at least2 competitors.

IV. Reference Notes + Bibliography (10 points):a) Include reference notes in the body of the document. Support all of your assertions!b) List all of your sources again in the bibliography. Be sure to use the Harvard format for

websites, which includes all the website info, not just the address. Points will be deductedfor improper formatting.

IMPORTANT NOTES

The midterm accounts for 30% of your final grade.

Remember: your limit is 2000 words for the entire exam. Your reference notes andbibliography will not count toward your word total.

Make sure your paper is anonymous. Do not put your name anywhere in the document. Upload your completed midterm as a .doc (not pdf) through the RKC system. Do

NOT email it to your professor or post it to the forum. Due to unpredictable Internetservice, upload your paper a few days before the deadline. Turn in your paper on time. Meeting deadlines is critical in business, and late papers will

be substantially penalized. Clarity is important. We do not expect perfect English, but please proofread your work to

eliminate confusing passages and major errors. Students often accidentally skip entiresections, which causes them to lose many points.

Do not plagiarize. Plagiarism has been described in the RKC forum, and in theExpectations & Guidelines of this course. Use quotation marks where needed, and all of your sources must be referenced, even if you take just one word or number from them.



Introduction

Apple Inc. is an American company founded by Steve Jobs and Steve Vozniak thatdesigns and manufactures computer hardware, software, in addition to consumer electronics (iPads,iPhones, iPods) and resells third-party digital content (iTunes and App Stores).

Its Triple Bottom Line applies as follow:

People: Apple is an Equal Employment Opportunity and Affirmative Action Employer (Apple Inc., 2012b);it even is committed to diversity by being an Equal Opportunities employers as well as provide to jobapplicants with physical or mental disabilities through a special “reasonable accommodation” plan ( AppleInc., 2012a).

Planet: In the past Apple has been accused of not being environmentally friendly. In A Greener Apple,Steve Jobs (2010) explained that Apple’s mistake was that in their communications. Apple usually tendsto focus on current accomplishments. Jobs did admit that Apple had neglected sharing with itsStakeholders the information on how Apple was working to become greener. Jobs then provided indetail the plan for removing toxic chemicals from products as well as further details on the ongoing

recycling program started in 1994.

Profit: in August 2012 Apple became the most valuable company in History (Benzinga, 2012). With thecompany continuously innovating, and being ahead of competitors with products like the iPad; Apple hashad financial success. In addition, by keeping the product lines simple and straightforward the companyis able to cut the spending on all materials and costs. The product lines integration between thehardware and software; and with the integration of all the products together with a service like to iCloudprovides users with a unified experience, which keeps them within the Apple family. It is a very smartway to keep customers locked in and coming back.

Stakeholders

Customer Analysis

When looking at the cost of purchasing any Apple product, one realizes quickly that the targetmarket for Apple are consumers that are not sensitive to price (Arvidson, 2011), we are talking thenabout the purchasing power or the middle and upper class broadly.

In his article, Asay (2010) goes beyond the industry’s obvious and states, “Apple doesn’t target markets.It targets people.” He then adds, “It focuses on users. And Apple lets them decide how and where they’lluse its products.” However, we must not forget all the professionals in media and design that have been using Applecomputers and software for years before the revitalization of the brand when Steve Jobs came back

after his exile. With the emergence of high-end products such as iPhone and iPad, and when looking at Appendix 1, we can see that did Apple consumer base is young between the ages of 18 to 34.

When Apple introduced the iPad they pioneered and developed a brand-new market. A US study(Crossley, 2001) has shown that about 55% of tablet owners are male and that nearly 30% of them areaged 25 to 34. To support, what was said in the above paragraphs the study also shows that 45.9% of the users were from household earning at least $100,000 per year.

Into 2012 Business Insider (2012) completed a survey about how people actually use their iPad, hereare some of the results:



Chart 1: What do you do with your iPad?

Chart 2: Evolution of Behavior



In addition, Zuse (2012) shares results based on a Rosetta survey stating:

“According to a Rosetta Survey from a few months ago, tablet users who let their iPads out of thehouse are using them at work 34% of the time, on the go 45% of the time, and in hotels, coffeeshops and “other” places 38% of the time. When they’re using their tablets at home, 81% of respondents seems to use a tablet in the living room, 68% use one in the bedroom, 41% report

usage in the home office, and a small 24% of usage happens in the bathroom.”

For two years they dominated the market and the early attempts to challenge the iPad by HP and RIMMfailed. The iPad has been slowly losing market share, as consumers have been moving towards

Android. The slowdown is not unexpected and the market share of the iPad still remains around 68 to70% of the market. Last quarter 14 million iPads were sold as reported by CBS News (2012). However,with the recent introduction of the iPad mini, Apple is clearly targeting the competition’s tablets like theKindle Fire and Android tablets that are much cheaper. On Amazon, a Kindle Fire retails at a value of $299 whereas the iPad mini is priced at $499.

Competitor Analysis

From a Technological standpoint the main competitors for Apple Inc. are: Microsoft Google Dell Nokia

In the Operating Systems Market, Mac OSX competes against: Windows Linux

For tablets and smartphones the competition for iOS is: Google’s Android OS

Windows mobile Blackberry OS

As hardware and software are symbiotic to each other in Apple devices, the decision here was tocompare to competition by OS rather than the hardware, since Microsoft and Google license their software to a large number of hardware companies such as Dell, Nokia, and Amazon etc.

Windows holds 80% of the market share, and has been the dominant for years. Created by Paul Allenand Bill Gates, Microsoft is mostly recognized for it’s two main software widely used on PC’severywhere: Windows and Office. Microsoft also introduced in the market some PC accessories as wellas the game console: Xbox, however consumers think of Microsoft they think of it as a softwarecompany. Whereas Apple, from the start has always integrated hardware and software.

Strengths:

The largest software company in the world Very strong brand name and brand recognition Consistent financial performance Success of the Xbox Dominant presence in Corporations Offices based in the US and around the world.

Weaknesses:

Windows product range too complex and too varied No new major lines of products or software has been developed recently Windows updates take 2 to 3 years to be completed and deployed to the public Windows mobile has been a disappointment



May still be perceived as a monopoly Failure of Windows Vista Software is overpriced Piracy issues

Small Shift to Open Source software

Company Analysis

The key Internal Stakeholders at Apple lies within its management (Apple Inc., 2012e).

After the passing of Steve Jobs, the public has become very familiar with Tim Cook the new CEO, whilenot forgetting usual faces such as Jonathan Ive, Phil Schiller and Scott Forstall. In the recent years themedia and the public have become very used to seeing those faces introducing the latest products aswell as the new updates to the Apple product line.

Though he is no longer with us, in his book Insanely Simple author Ken Segall (2012, 87) describedSteve Jobs’ dedicated immense contribution to the Apple marketing message. Steve Jobs obsessionwith simplicity created some of the most influential marketing campaigns of the 20 th century. The “ThinkDifferent” campaign being one of them. Throughout the book Segall points out the difficulty of keepingthings Simple and not allow complexity to get a foothold into the products or the marketing campaigns.

Tim Cook does have very difficult shoes to fill after Steve Jobs. However by looking at the most recentiPhone advertisements as posted on Ken Segall’s blog (2012), it does seem that Steve’s legacy is goingto continue on and the company and it’s key personnel will follow in his footsteps and respect his visionand legacy still.

Community Analysis

The general external stakeholders for Apple Inc. include:

Shareholders Lenders Employees Outsourced Manufacturers and their employees External Apps and Software Developers (App Store) Customers Various Suppliers Music Industry (iTunes) TV and Movie Industry (ITunes)

One of the most notorious Apple Manufacturer is Foxconn; one of China’s largest employer with 1.2million workers as well as provider 40% of the world electronics for Apple as well as other giant names.

Foxconn came under scrutiny a few times for the very poor conditions for the employees. Just recentlythe workforce has gone on strike over the very poor working conditions especially related to theproduction of iPhone 5. The employees were put under pressure for the production of the new iPhonesas well as for being forbidden to take a public holiday in order not to affect production. Barboza (2012)reports that Apple and the Hon Hai Group of Taiwan, have been working together to improve conditionsfor the employees, offer them good salaries as well as good working standards.

The Foxconn scandals impact Apple negatively, although Foxconn is a provider for other big brands, Apple seems to be the one that always takes the heat. Adams (2012) explains how Apple sent a teamto China led at the time by Tim Cook and recruited non-profit Fair Labor Association to audit the currentworking conditions. However, despite’s Apple’s Supplier’s Responsibility charter (Apple Inc., 2012f)where it says that it is committed to the “highest standards of social responsibility across our worldwidesupply chain” there are still problems. This negativity may not directly impact sales, but it does bring upnegative press as well as question the effectiveness of the charter and Apple’s true commitment to theseissues.



As Steve Jobs took responsibility and explained the “Green” future of Apple (as mentioned previously), itmay be imperative to produce something similar about outsourced workers and make it part of the Applecore values and branding.

Brand and Positioning Analysis

The Apple brand is a leader amongst several competitive markets including general consumer electronicgoods and computing.

The Logo: Apple has gone through 3 physical logo incarnations. Edible Apple (2009) depicts theoriginal one that lasted a year called the Newton Crest.

Logo 1: The Newton Crest

Secondly, came the Rainbow Apple logo, which lasted for 22 years, until 1998.

Logo 2: The Rainbow Apple

Until it was tossed and replaced by the most recent monochrome one.



Logo 3: Monochrome Apple

For the two most known incarnations, the logo represents the name of the company. When one looks atthe apple logo, there is no possible room for confusion as to what it represents. It is simple andunderstated even in its multicolor incarnation and quite simply straight to the point. It is a perfect mirror image for Jobs quest for simplicity. This visual identity is very strong and easily recognizable.

The Personality: By looking at the advertisements and the customer analysis done above, it is clear thatthe brand strategy focuses on humanity and emotions. The proof is in the simplicity of the products andtheir ease to use. Just by looking at the product line on the website or any Apple Store, the brand’spersonality shines through as innovative, cool, stylish/trendy, easy and friendly. Appendix A, showed usthe personality profile of Mac users and they match very closely to the brand personality. The brandingstrategy and its personality has clearly been successful in the recent years, as Apple has been steadilyincreasing its customer base.

The Reputation: Jonathan Morris (2012) shares that “ Apple came in first place with a ReputationQuotient (RQ) of 85.62, dethroning last year’s leader, Google.” This result is based on the 2012 HarrisPoll Reputation Quotient:

“The 2012 Harris Poll Reputation Quotient, a survey that measures corporate reputation for brands and companies in the United States, asks the general public each year to assess 60 of themost visible companies in the country. The survey measures six different factors that reflectcorporate and brand reputation. Those factors are: Social Responsibility, Emotional Appeal,Financial Performance, Products & Services, Vision & Leadership, and Workplace Environment.”

In 2011, Apple was top in four out of the six categories.

“The Harris survey doesn’t just measure the public’s perception of a brand, but also measureshow eagerly individuals would recommend the brand or how likely they would be to invest.”

Positioning Map for the Tablet market shown in Map 1.

Positioning Map for the Operating System shown in Map 2.



Map 1: Tablet Market

Map 2: Operating System usability.



Bibliography

Adams, S. (2012). App le 's New Foxcon n Embarrassment . [ONLINE] Available at:http://www.forbes.com/sites/susanadams/2012/09/12/apples-new-foxconn-embarrassment/. [Last

Accessed 28 October 2012].

Apple Inc. (2012a). Jobs at App le . [ONLINE] Available at:http://www.apple.com/jobs/us/accomodation_drugfree.html. [Last Accessed 1 November 2012].

Apple Inc. (2012b). Jobs at App le . [ONLINE] Available at: http://www.apple.com/jobs/us/. [Last Accessed 1 November 2012].

Apple Inc. (2012c). Apple and the Environment . [ONLINE] Available at:http://www.apple.com/environment/. [Last Accessed 1 November 2012].

Apple Inc. (2012d). Apple Recycl ing Program . [ONLINE] Available at: http://www.apple.com/recycling/.[Last Accessed 1 November 2012].

Apple Inc. (2012e). Executiv e Profi les . [ONLINE] Available at: http://www.apple.com/pr/bios/. [Last Accessed 1 November 2012].

Apple Inc. (2012). Suppl ier Responsib i l i ty . [ONLINE] Available at:http://www.apple.com/supplierresponsibility/. [Last Accessed 29 October 2012].

Arvidson, E. (2011). eHow tech . [ONLINE] Available at: http://www.ehow.com/info_8737092_target-audience-mac-apple-computers.html. [Last Accessed 1 November 2012].

Barbosa, D. (2012). Foxconn Plant Closed A fter Riot , Company Says . [ONLINE] Available at:http://www.nytimes.com/2012/09/25/technology/foxconn-plant-in-china-closed-after-worker-riot.html?_r=0. [Last Accessed 29 October 2012].

Benzinga Editorial (2012). App le Recycl ing Program . [ONLINE] Available at:http://www.forbes.com/sites/benzingainsights/2012/08/21/apple-now-most-valuable-company-in-history/.[Last Accessed 28 October 2012].

Edible Apple (2009). The Evolut ion and History of the Apple Logo . [ONLINE] Available at:http://www.edibleapple.com/2009/04/20/the-evolution-and-history-of-the-apple-logo/. [Last Accessed 29October 2012].

Hunch. (2011). Profi le of Mac vs. PC Users [Infograp hic] . [ONLINE] Available at:http://osxdaily.com/2011/04/21/mac-vs-pc-users-profile/. [Last Accessed 29 October 2012].

Jobs, S. (2010). A Greener Apple . [ONLINE] Available at:http://www.apple.com/hotnews/agreenerapple/. [Last Accessed 1 November 2012].

Morris, J. (2012). Apple’s Reputation is the Best Among Top Brands. [ONLINE] Available at:http://wallstcheatsheet.com/breaking-news/apples-reputation-is-the-best-among-top-brands.html/. [Last

Accessed 29 October 2012].

Segall, K. (2012). Insanely Simple . 1st ed. USA: Portfolio Penguin.

Segall, K. (2012). Whew! App le shines again in new iPhone ads . [ONLINE] Available at:http://kensegall.com/2012/09/whew-apple-shines-again-in-new-iphone-ads/. [Last Accessed 23 October 2012].

Yarow, J. (2012). How People Actu al ly Use The iPad: Resul ts From Our Exclusive . [ONLINE] Available at: http://www.businessinsider.com/ipad-usage-survey-results-2012-7?op=1. [Last Accessed

31 October 2012].



Zuse. (2012). What do p eople really use their Tablets for? . [ONLINE] Available at:http://zuseapp.com/tablet-usage/. [Last Accessed 29 October 2012].



Appendix A: Mac vs. PC user





Documents

Marketing Analysis for Apple Computers