Apple i phone marketing plan

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Apple i phone marketing plan

  1. 1. Apple iphone Marketing Plan 1 Apple iPhone Marketing Plan •Executive Summery •Situational Analysis •SWOT Analysis •Marketing Objectives •Marketing Strategy •Implementation •Budget •Control
  2. 2. Apple iphone Marketing Plan 2 Executive Summery The Past– Steve Jobs, Steve Wozniak and Ronald Wayne established Appleon April 1, 1976 in order to sell the Apple 1 Computer Kit that was handbuilt by Steve Wozniak. The Apple 1 was sold as a motherboard (with CPU,RAM and basic textual video chips) – less than what is considered a personalcomputer today. Apple was responsible for creating the desktop publishingmarket due to their innovative programmes, PageMaker and LaserWriter.Between 1983 and 1996 Apple experimented with a number of failedconsumer target products including digital cameras, portable CD players,speakers, video consoles and TV appliances. Market share and stock pricesdecreased. In 2001, Apple introduced the iPod portable digital audio player.The product was phenomenally successful – over 100 million units were soldwithin 6 years. The Present – January 2007, Steve Jobs, the CEO and Co-Founder of Apple,announces that Apple Computer Incorporated would now be known as AppleInc. He also reveals the long anticipated iPhone , a combination of anInternet-enabled smartphone and the iPod. In June 2008, he announces thatthe iPhone 3G would be released in July 2008, this newer version addedsupport for 3G Networking and assisted GPS navigation, among other things.
  3. 3. Apple iphone Marketing Plan 3 The Future – Apple plans on focusing on satisfying personal consumer demands rather than merely fulfilling a demographic requirement as well as,improving performance and stability rather than introducing new featureswhen releasing new versions of any product. The iPhone targets consumers who need to store information andcommunicate or people who want entertainment on the go. Apples targetsegments consist of professionals, students, corporate users, entrepreneurs,and health care workers. Currently, the market for high-end phones like theApple iPhone is small. Few people want Internet, video, and PDA features inone device because of the high price. The smart phone market is still relativelysmall compared with general phone market. The market will rapidly increase incoming years due to lower prices and greater power.
  4. 4. Apple iphone Marketing Plan 4 Situational Analysis Political Situation •Taxation is something that governments put and Apple should bestudy this as country by country case to anticipate profitability, andpricing strategy. •Importing laws in the world with GATT are in favor of trading. •Countries are very variable in stability of, so we should study eachcountry case by case. Economical Situation •Economical growth world wide is in a big recession which needcareful manipulation •Potentiality of the market is decreasing but it is higher than anyothers in the Telecom sector. Socio-Cultural Situation •Population growth leading to expansion of the sector needs for cellphones. •People depend more an more on mobile communicationeverywhere. •There is educational growth in the world. •Culture’s perception of the technological devices is positiveworldwide.
  5. 5. Apple iphone Marketing Plan 5 •Literacy & illiteracy level is not affecting using cell phones butaffecting high technological cell phones, this fact needs to beconsidered. •Acceptance of imported products in some countries are less if there is local provider •There are different social views that may affect product should beconsidered (e.g.: Boycotting American products in the Islamicworld) Technological Situation •Level of technology in the world is increasing. •Internet level of awareness & usage for individuals & industrialaspect are increasing worldwide •Fixed phone lines capacity and development attempts. •New technologies in the cell phones are increasing. •Future plans for technological linkage between cities, universities,colleges, hospitals and other institutes are increasing and can beconnected to cell phones •Level of usage of the E- Technology (online bidding, billing,complaints, blogging etc) are high and trendy. Competition Situation •There are 19260 cell phone producer in the world, but there aremore than 15 big companies competing at the world level Market.
  6. 6. Apple iphone Marketing Plan 6 Environmental Situation •The global concern of the Global Warming issue & other pollutioneffects concerning the packaging material and radiation of the cellphones •The demand of the international environmental approvals is a must(if there is any) Sales Situation Cell phones industries are one of the mostprofitable industries everywhere and theMarket is increasing
  7. 7. Apple iphone Marketing Plan 7 S/O Analysis Strengths Innovative– The iPhone has an innovative touch screen. It also hasmany functions of other mobile products all in one device Compatibility –The phone will work with iTunes and with otherMac/Apple products and OS software tools which means limitlesspotential for upgradeability. Ease-of-Use– The all-new touch screen interface recognizes multifinger gestures, just as the human hand normally behaves. Brand awareness–Apple is well known for cool essentialgadgets like the iPods along great technological innovations like theoriginal Macintosh. Price– iPhone would be sold at a reasonable price for itsvalue. Quality– Scratch resistant screen – durable and lightmetallic finish - software suite resistance to computer viruses. Opportunities: Increasing demand and expansion to a new target segment – As technology advances and smart phones get cheaper Apple willattract consumers and get iPod users to upgrade to iPhones.
  8. 8. Apple iphone Marketing Plan 8 Upgradeable– iPhone software allows new exciting features to be brought in which take advantage of the touch screen ability. Future versions will also be hardware upgradeable. Partnerships– Apple can collaborate with many powerful globalmobile phone companies to flood the market with iPhones, whichreduces costs in marketing and increases revenue through long- termagreement deals. Weaknesses Image– The Apple brand is not targeted towards business people anddoes not have a reputation as being compatible with the corporate world. Price– Apple does not yet offer lower priced models for more costconscious consumers. User Interface– Touch screen interfaces suffer from the problem of “gorilla arm”* *Gorilla arm is a side-effect that humans face when using touch screens for long times as humans are not builtto hold their arms at waist or head-height, making small and precise motions. After a short period of time, crampmay begin to set in, and arm movement becomes painful and clumsy. This is now considered a classiccautionary tale to human-factors designers.
  9. 9. Apple iphone Marketing Plan 9 Threats Increased competition– Smart phones are easier to make now morethan ever. More companies may enter the market, and competitors oreven Apple contractors can maneuver around patents to create similardevices. Downward pricing pressure– The iPhone is marketed as a high- end phone, but phone prices are almost certainly going to fall whenother companies undercut the price of iPhones. Difficulty expanding into Asian market– There is less hype andinterest in Asia since smart phones are better known and already widely used. Competition (Palm)- Palm has the longest history in PDA marketand has experience-developing software for mobile devices. It is also a well-known brand for businesspeople. Existing software is wellestablished and compatible with many products for this market. Themarket is familiar with Palm products; significant switching costs areinvolved in going to an iPhone. Palm can add many similar capabilitiesto their products that match the iPhone and expand to a wider marketthrough lower cost and higher-power products.
  10. 10. Apple iphone Marketing Plan 10 Marketing Mix Strategy Product •Full year warranty along with an optional three-year Apple Care warranty •Same taste as all other Apple products •Special edition version to be launched (including the iPhone Beatlesedition celebrating their 40th anniversary) •Launching a cheaper version in 2008 with lessadvanced features along with a moreadvanced version for professional use •Adding the following features to the iphone(large disk storage capacity, lower weight,thinner device, long battery life, 4G wireless,GPS and improved camera) Price •Set the base model at a cheap price of $349 •A more advanced model for $399 •Speciallimited edition Beatles iPhone for special prices •Generally lower our prices to ensure we establish market dominancein as short of time as possible Place •Massive rollout worldwide at all reputable major retailers •Massive rollout Online, Showrooms and in all cell phone providers
  11. 11. Apple iphone Marketing Plan 11 •All Apple Stores the Apple website will dedicate themselves to theiPhone •Eye catching displays will be found at all physicalstores featuring the iPhone to make the productstand out from the pack •Apple Stores will have the iPhone on display a fullmonth before its worldwide release Promotion •Integrate Apple message of revolutionary communications andaudio/visual experience together in all media advertisements •Differentiate the iPhone against others is the touch screenfunctionality •Emphasize Apple brand prominently and associate theiPhone with the iPod’s groundbreaking lineage •Original but tasteful advertisements at the same time •A massive TV campaign is planned before launching the iPhonefeaturing a soon to be legendary ad to be the talk of the country •Advertising will be appearing on a regular basis tomaintain general public awareness
  12. 12. Apple iphone Marketing Plan 12 Marketing Research •Four age groups will be targeted: 15-20 years, 20-25 years, 25- 45 years, and 45 years and up •High School and College aged people will demonstrate social uses •The 25-45 years group will be used to determine business applicationand social/personal use •The 45 years and above will give us a plan to market to more senior well-refined group •This research will be done through surveys (via email campaignthrough portals such as, iTunes and other on-line applicationdeveloped for the iPhone) and interviews (in Apple stores) with thesame age groups listed before •To bring the iPhone to the front of the business world it is importantto research different ways to grow the 15-25 year old group into business uses of the product •Brand awareness will be an important tool in taking the Apple brandfrom "social cool" to "business cool". • We will ask for feedback on iPhone features, and implement thosechanges most important to the end user in the next generation iPhone • We will allow users themselves to design their own ideal iPhone on-line and use any useful ideas to further refine future iPhone models • We will continuously scour the Apple fan websites to understand what the Mac faithful are saying, as they are our best customers.
  13. 13. Apple iphone Marketing Plan 13 Implementation Compensation system •workers $5 incentive pay for every non reject phone they produce•$10 per phone six sigma quality program•each worker $5000 each year for best practice training use control measures to closely monitorquality and customer service satisfaction consumers can contact the main headquartersabout any possible technical problems– by usingApple Customer Service Bar and a customer service phone number stored in the phone book. In case of slow sales •Offer iPhone to customers who have purchased other Apple products$10 per phone six sigma quality program, which will lead to:•demonstrate the product for consumers, it will promote synergyand lure buyers.•develop deep relationships with two very different segments:those who have it and those who aspire
  14. 14. Apple iphone Marketing Plan 14 Budget •Our break-even analysis assumes wholesale revenue of $500 per unit variable cost of $250 per unit and est. fixed cost of $50 million. Basedon these assumptions the break-even calculation is $50 milliondivided by $500 minus $250 equals 200,000 units sold. •Break-even calculations indicate that Apple will become profitableafter the sales volume exceeds 200k. After the first year Apple willmake a profit of 1.25 billion minus 50 million in fixed costs. •Recommended price is $350. The markup is 40 percent. •It is predicted that sales volume will increase at least 60 percent fromthis change; this will decrease the impact of fixed costs and improveopportunities to increase our production scale, which will furtherimprove profits in the long run. Control To plan our strategy we will meet monthly with the board of Apple,present our information, and make a proposal for continued marketingefforts. Before each meeting our team will meet in private, with eachperson presenting their own proposal based on the information theyhave learned. After the initial proposals, we will vote on the best oneor come to a compromise. The final proposal sent before Apple is theresult of that meeting.

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