phone Global Marketing Marketing Essay

Iphone Global Marketing Marketing Essay

Perfect combination of internet browser, mobile phone and iPod which not only satisfy the customer needs but exceed their expectations. It’s a perfect match of information, communication, technology and entertainment which show its heartfelt connection with its customers.

Target market of iPhone consists of professionals, students, corporate users, and entrepreneurs. Initially its market is small but with the passage of time decrease in prices and addition of certain features will increase its market in coming years.

The success of Apple Company In Future lies on its skill to enter the Chinese mobile market. In this market due to economic, social and cultural differences Apple didn’t get the favorable outcomes. Apple is not feeling comfy with the Chinese Government. This

Government is known for having absolute sovereignty over their customers as well as their business.

Following is the report that throws light on market position, strength and weaknesses of Apple, when they entered Chinese market. Then at the end a plan is made that would clear Apple’s status in the market.

Introduction

Market’s personal computers, digital music players and mobile communication devices are designed and manufactured by Apple Inc. and it also sells assortments of related software and networking solutions.

IPod has been a remarkable product of Apple; it has sold for more than 163 million units to date. As the market of digital music players has filled completely, Apple made a new smart phone that is known as iPhone. A person who is deliberate for style and would like to enjoy the entertainment, browse internet, iPhone is the best option for them. IPod, web browsing, email and personal computer all are combining in single, stylish and easy to use devise, in iPhone. Many people thought that Apple would not be able to survive in this complex market and in only 2 years they sold more than 21.17 million units. If we compare Apple, it took 3.75 years to sell that quantity of iPods.

For Apple iPhone is more important than iPod. The market of iPhone is also larger than that of the iPod. Now the real competition is between the traditional mobiles and smart phones in the market. In the first quarter of 2009 sales of mobile phones were 269.10 million whereas sales of smart phones were 36.4 million. The sale of mobile phone dropped 9.4% but smart phone sales increased by 12.7%.

China is the 3rd largest mobile user nation after India and U.S. To keep the momentum going Apple needs an excellent international success strategy and China is enormous candidate for that. 10 % of the world’s iPhone market could be made by China because in past two years 26 million units of mobile phones have been reached and lot of sales have been added by this. Apple will occupy 5% to 6% global sales if they released iPhone at once. China will become the most important part of Apple’s sales as the population becomes wealthier there.

There are 760 million users in the market of iPhone. iPhone is made available to 88 countries of the world. China mobile and China Unicom are the only two companies in the country that provide mobile service. Apple has not been succeeded to bring iPhone to China. China mobile and China Unicom collectively subscribed a base of 565 million users, in which 74% were of the iPhone market.

1 Situation Analysis

1.1 Stakeholders

Apple got a strategy and according to that, it only got special partners. This strategy allows them to deal with carriers in each country. Because of this, all the cards are held by carriers and the mobile manufacturers doesn’t have anything. But in China there are only two mobile carriers, and they are China Mobile and China Unicom.

China Unicom would be an alternative partner of Apple; it got the smallest subscription base of 130 million. This decision wouldn’t be the good decision for some reasons.

In recent years China Unicom has been doing efforts against China Mobile. Monthly growth of China according to Operator proceeds in different ways. It’s between China mobile and China Unicom. China Unicom has adopted strategy to be a world leading broadband communication and information service provider due to continues decrease in revenue. This change in strategy put Apple in a difficult situation because if they choose China Unicom as their exclusive partner they would be taking risk. But China Unicom uses a wireless technology name CDMA. And iPhone uses GSM technology, so if Apple becomes partner with China Unicom they would have to build a 2nd version of iPhone, but this decision wouldn’t go with Apple’s strategy.

Thus, if Apple become partner with China Mobile this would be more suitable. Apple have largest smart phone and China mobile have the largest subscription base.

1.2 Environment Analysis

Now a day’s China is considered as world’s primary engine for growth. World Band forecast the continues raise in China GDP growth rate. The largest number of mobile subscription users is with the China and it’s growing at over 20% per anum. If it’s considered that population of China is 1.3 billion and only 35% uses mobile than it show really important growth opportunity for Apple. As compare to other emerging economies, China is the biggest receiver of foreign direct investments worldwide so Apple has an opportunity to jump into this economy and retain its existing brand image.

1.3 Political and Legal Environment

In China Government has complete control over mobile industry. (MII) Ministry of Information Industry regulated the Chinese telecom market and all foreign companies need its permission for entrance. China Unicom and China Mobile are also influenced by Ministry of Information Industry. Apple should be careful while entering into the market because Chinese government has absolute control over citizens and companies.

1.4 Economic Environment

Form the past quarter China has been the fastest growing nation with an average annual GDP growth rate of 10%. 2nd largest economy of the world is of China. And after China, United Nations. In 2008 United Nations have a GDP of $7.8 trillion.

1.5 Social and Cultural Factors

From past 10 years gross and disposable income has rapidly increased. And it is expected that this growth would continue till 2015. Since 1980’s Engel coefficient has been declining according statistical figures. Urban and rural populations both are at welfare level and this allows them to spend some of their income on non basic things. Chinese people who can afford are more interested in adaption of new technologies and show their strong interest in new products. Males are more than half of the population and eager to spend more on digital and electronics product such as mobile phones and digital cameras.

1.6 Technical environment

As China emphasized more on technology and science, it has become better connected to global economy. Due to this emphasis scientific structure has been improved which results in increase in available money for research purposes. Chinese government approximately used 2 percent of its budget on R & D which is equivalent to Japan and U.S spending. In 2G network the solely population coverage rate of China Mobile is 98%. China mobile haven’t yet started to operate with 3g network. If it is used on iPhone this would give best result. Fewer customers are satisfied in 2G network because internet speed is too slow in it. It is intended that China mobile have 70% 3G coverage at the end of 2009.