This document is a market analysis report for Beats by Dre. It analyzes the company's success in branding itself as a status symbol in the headphone industry. However, compared to competitors, Beats' products are of lower quality but higher priced. The report recommends that Beats improve quality, expand customization options, and control pricing to attract new customers and sustain the business. It also suggests gathering consumer feedback to better understand wants and likes.

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A Market Analysis for
(Beats by Dre)
(Everett Berry)
Full Sail University
Project & Portfolio II: Business and Marketing
(11/24/19)

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EXECUTIVE SUMMARY
This is a market analysis report for the company Beats by Dre. This report will show its
success as a brand and creating a status in the industry of technology. It will show how using the
company’s established name to better accompany the consumers needs. At the end of the report,
the recommendations for the brand are based on capitalizing on its recent successes. Also,
capitalizing on the opportunities that can bring in new consumers, money and partnerships.

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OBJECTIVE
My brand name is Beats by Dre. What the company need me to analyze
whether or not to expand or eliminate a product line as well as changing the target
segment. Beats by Dre is a high-tech product, commonly known for its fashionable
status. But when compared to other companies, Beats price is too high with a bad
quality. It is the company’s best interest to expand more on the product quality and
price due to the change of the “educated consumer.” Now, as far as Beats by Dre
target segment should be switched to establish itself as the top brand name for
headphones. Their approached is being a fashionable status but the company need
to apply a new status to their product that solidify their quality.
Because Beats by Dre started receiving rumors about its manufacturing
creating products with cheap materials and jacking up prices to consumers. It’s best
to destroy that type of negativity and provide knowledge and proof that the
company uses top technological materials to create a high-end technology brand.
The company a lot of money on packaging and marketing towards the product and
not focusing more on the product itself. Instead of being considered a fashion

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statement it should take the route of a superb quality product. The company rivals
produce the better quality with a cheap price. With proper analysis of these issues
would create Beats by Dre company into a powerhouse for headphone and the
technology industry
RESEARCH METHODOLOGY
I have acquired various findings for the company’s market strategies. There is a mixture
of both internal and external research. This research was gathered during the month of November
and all of the sources are up to date with their information. Finding this information was quite of
a challenge because all that was available was students own reviews on the company. The
information that is missing is the consumers actual testimony of the brand itself.
RESEARCH AND KEY FINDINGS
Beats by Dr. Dre (Beats) is a leading audio brand
founded in 2006 by Dr. Dre and Jimmy Iovine. Through its
family of premium consumer headphones, earphones, and
speakers, Beats has introduced an entirely new generation to
the possibilities of premium sound entertainment. The brand’s
continued success helps bring the energy, emotion, and
excitement of playback in the recording studio back to the listening experience for music

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lovers worldwide. Beats was acquired by Apple Inc. in July 2014. Apple has been aggressive
about making Beats a key part of their current brand. Beats was instrumental in the
redesign of Apple Music, and Beats has run the Beats 1 internet radio channel which is host
to premium programs curated by such celebrities as St. Vincent, Ezra Koenig, and more.
The co-founder, Jimmy Iovine (n.d.), mentioned that Beats headphones target age
groups of Tweens and
Generation Y (Millennials).
These groups vary between 18
and 35. However, according to
the AudioCircle poll, the
majority (84.3%) of audiophiles age ranges from 30 to 60. (AudioCircle, 2008), and
according to Haring (2006) report, it is a male culture dominance. Therefore, the customer
for this product is a male from 30 to 35 years old.
Anytime a product is produced by a parent brand there are the possibility of
unauthorized products. There is not a concrete way to determine whether or not you have
counterfeit products of Beats. Some consumers do find a better alternative product because
Beats are expensive. Economic factors can alter the product consumption, for example in
the eventuality of financial crisis. In instance, the financial crisis of 2009 reduced
dramatically technological productivity. Beats by Dre is a luxury item, so in time of
shortage, people can choose a less expensive product.
What Beats has done extremely well is leverage its position as a staple of youth,
sports, and fashion culture. You’ll see Beats headphones being worn by many of the top
athletes in the world and in a number of music videos from major artists in order to sell the

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same headphones over and over again, despite the lack of new hardware. Beats
consistently releases new colorways of its headphones (a marketing strategy popularized
by Jordan Brand and employed throughout the sneaker and fashion industry) to keep its
brand relevant. Beats just inked a deal to be the official headphones of the NBA and USA
Basketball; it has signed major celebrities like LeBron James, Neymar, Colin Kaepernick,
and Serena Williams as brand ambassadors; and, by most metrics, it owns nearly 50
percent of the premium headphone market (Singleton. 2018).
As a company that is based on music and delivering quality sound to customers
through its various headphone and speaker products, Beats Electronics also
takes on the mission of stopping the illegal downloading of music by
introducing an online music streaming service called Beats Music. Beats
Electronics also share a social responsibility with the brand Product Red.
Beats Electronics released Product Red special edition headphones to raise
awareness for the Product Red brand. Product Red raises funds to Eliminate
HIV/Aids in Africa, and for each Product Red headphone by Beats sold, a percentage is
donated to the Global Fund.
CONCLUSIONS
Though this analysis Beats by Dre has successfully branded themselves as having
exclusive and high-quality products. When put to the test against other competitors i.e. Sony,
Bose, Skull Candy etc. Beats was deemed inferior in quality. They overcame that obstacles
through extreme strong branding. With that extreme branding as an exclusive high-quality
product, Beats centered a large part of the market. Currently this is their main constraint and the
main focus of their marketing.

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By expanding with Apple, now Beats can successfully use Apple’s channels to create
awareness of the new brand and target a market that has been neglected by competitors. If the
company can close the gap between its perceived value and the sound quality, the target
market for the millennials will definitely increase significantly. At the same time being alongside
with Apple, Beats can come up with fresh ideas for products. Those new release products will
have a lot of research, reduce the cheap manufacturing rumors, and provide their target
markets satisfactory for quality sound.
RECOMMENDATIONS
How should your company capitalize on favorable findings? How should it respond to
unfavorable findings? Are you making strategic, tactical, operational or micro recommendations?
Include at least one SMART goal in your recommendations (Specific, Measurable, Attainable,
Relevant and Time-bound). Be clear about the benefits of your recommendations. Acknowledge
unknowns and include recommended future research.
Moving forward, the biggest thing that the brand need to capitalize on is developing a
better price system. There are a lot people who believe that Beats headphones are overpriced and
catered to someone of status. The company already established itself but has not reach the
individuals that appreciates the quality of the product and not the status it brings. Those people
need to be reached out. To change the price system, I believe the company should provide a
custom-made Beats headphone service that’s not only for the artist/celebrities. Products
that are unique and fits your consumer sense of style is everything to a consumer.
Economic factors can alter the product consumption, for example in the eventuality of
financial crisis. In instance, the financial crisis of 2009 reduced dramatically technological

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productivity. Beats by Dre is a luxury item, so in time of shortage, people can choose a less
expensive product.
Being able to control the market with pricing, status, exclusivity, and quality would
sustain the company in all aspects. In the future, the company should take in the consumers
opinions and ideas to better understand what their buyers like and want.
REFERENCES
Cite your sources. Use APA short form in the body of the paper and long form in this section.
For this section, use a hanging indent shown here, with the second and subsequent lines
of each source starting ½ inch from the left margin (Format/Paragraph/Indents/Hanging).
Barton, S. (2016, August 29). How Dr.Dre's Beats Took Over The Headphone Market: Articles:
Strategy. Retrieved from https://channels.theinnovationenterprise.com/articles/how-dr-dre-s-
beats-took-over-the-headphone-market.
Christina Davis May 21. (2018, May 21). Apple Must Face Powerbeats Headphone Battery Defect
Class Action. Retrieved from https://topclassactions.com/lawsuit-settlements/lawsuit-
news/846403-apple-must-face-powerbeats-headphone-battery-defect-class-action/.
Dre. (1970, January 1). Beats By Dre. Retrieved from http://sapphirejohnbeats.blogspot.com/.
music, G. (2016, September 20). Dr Dre faces return to court in Beats headphones case. Retrieved
from https://www.theguardian.com/music/2016/sep/20/dr-dre-new-court-case-beats-headphones.
Singleton, M. (2018, September 11). Does Apple still care about Beats? Retrieved from
https://www.theverge.com/2018/9/11/17843130/apple-beats-headphones-future-iphone-event-
2018.

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