Marketing to Europe: iPod



 iPod Comparing Apple’s Marketing Strategy in the UK and France

Discussion Product Sophie Promotion Jamie Price Anna Place Andy Segmentation Ketan Recommendations Ketan

Success

45M iPods sold since 2001

14M Sold 4th Quarter 2005

iPods Sold (cumulative) 45M 40M 35M 30M 25M 20M 14m 15M 10M 5M 0M Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2004 2005

1 Billion Songs purchased and downloaded in past 3 years

3M Songs purchased and downloaded per day

MP3 Player Market Others 27% iPod 73%

Product

iPod Family

3 Level Analysis of iPod The Core Beneﬁts Secondary Level Augmented Product

Carry thousands of songs on the go Portable Music Player

Distinctive white colour Click-wheel Simple design

Simple user interface Easy to use

No difference in French and UK versions Language support for both in the software

Minimalist packaging Reﬂects the iPod design

Brand premium product distinctive name instantly recognisable white earphones clickwheel

 iPod iPod shufﬂe iPod nano Market segmentation = increased shelf space

 AppleCare

iPod eco-system

accessories

Car integration

Product Lifecycle

Introduction Growth Maturity Decline

iPods Sold (cumulative) 45M 40M 35M 30M 25M 20M 14m 15M 10M 5M 0M Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2004 2005

Promotion

Standardised Approach Centralised marketing team Economies of scale Consistent branding

Convergence of tastes

Ad United Kingdom

Ad France

Almost identical advert

TV Advertisement • Internationally recognised music star • No need for translation

Associative advertising

AIDA Awareness Interest Desire Action

Price

Disk Space Text Price

Size 512MB 1GB 2GB 4GB 30GB 60GB Price £49 £69 £139 £179 £219 £299 Difference +£20 +£50 +£40 +£40 +£80 £/GB £95 £69 £70 £45 £7 £5

Price Value 9 Box Model

Market in 2001 Sony iPod Creative (MD) Price £299 £200 £150 Songs 1,000 20 40 £ / Song 0.30 10 3.75 Market skimming

iPod in 2001 Perception Competitors Costs

Market in 2006 Price £220 £220 £199 GB 30 30 20 Songs 7,500 7,500 5,000 3p 3p 4p Price / Song Apple iPod Creative Vision:M SONY NW A300

iPod in 2006 Perception Competitors Costs

Price £299 / €424 £308 / €446 Sales Tax 17.5% 19.6% Ave. Salary £21,300 / €31,200 £16,663 / €24,400 % 1.4 1.82 £1 = €1.42

Cost plus pricing

Place

2001 Apple.com Customer Apple Retail

2002 Apple.com Customer Apple Retail Electronic Apple Customer Stores

2003 Apple.com Customer Apple Retail Electronic Apple Customer Stores Apple Websites Customer

2006 Apple.com Customer Apple Retail Electronic Apple Customer Stores Apple Websites Customer Apple Customer Supermarket

✓ ✓ Apple.com ✓ Apple Retail ✘ ✓ ✓ Electronics ✓ ✓ Websites ✓ ✓ Supermarket

Apple Retail ✘ •Compete in stores that sell other devices •Lack of expert knowledge of product •Inconsistent personal selling

Segmentation

No boundaries Age Gender Race Continent

Psychographic target on the basis of some psychological trait, characteristic or life style

Problem?

Player Songs £ / Song Tape 15 1 CD 20 2 Flash 20 10

Player Songs £ / Song Tape 15 1 CD 20 2 Flash 20 10 iPod 1000 0.30

Solution?

Entire music collection in your pocket (for most people!)

Positioned itself as the choice for music fans with the artist promos

Recommendations

 1 Maintain single global product for all markets 2 Develop Apple stores in main French cities such as Paris 3 Continue leveraging iPod brand into new areas

?

Marketing to Europe: iPod

52 comments

Notes on slide 1

132 Favorites & 2 Groups