Ch. 12-Services and Nonprofit Organization Marketing

Apple provide its consumers with one of the most outstanding customer service. Many might have different views based on their personal experience but, I personally never had any kind of issue with Apple’s service team. When a customer buys a iProduct from an Apple retail store, he is given a convenient option to help him setup his/her product. The customer can either do it in store that day or schedule an appointment. Apple also provide its customer with convenience of setting up the device from their home through video calling. Apple also has a group of employees in their retail store called the Genius Bar. The genius bar job function is to help Apple customer with their product and provide technical advice related to it. Other than this courtesy service, Apple also provide options for its customer to purchase an extended warranty. The extended warranty could be extended up to two years and they cover and technical faults and also accidental damage to the device.

In 2006, Apple paired with a non-profit organization (RED) to promote awareness about AIDS. Apple provide its customers an option to purchase a (RED) co-branded product for which the profits contributes directly to Global Funds to fight AIDS and towards making the world AIDS free. Currently, Apple along with (RED) organization is working on a research where they are finding ways to stop the transmission of AIDS from mother to the Baby. Apple is of the biggest partner of (RED) organization along with Bank of America.

Ch. 11 - Developing and Managing Products

Innovation is in Apple’s heart. For those of who that don’t know already, that “i” in every Apple’s product name stands for innovation. One of the biggest competitive advantage of Apple Inc. over its competitors has been their design. Apple’s Product Development Process may be one of the most successful design process ever implemented. Apple likes to keep secrets when it comes to product development. In Steve Jobs’ time at the company it was nearly impossible to find out about the internal workings of the business. Although, the growing interests of people in Apple’s new products has made it hard to keep secrets. Apple gives a lot of importance to their Designing process. Jony Ive, the British designer that is the Chief Design Officer (CDO) at Apple and his design team lead the company and they do not report to finance, manufacturing, etc. They are given free rein to set their own budgets and are given the ability to ignore manufacturing practicalities. At the heart of the design department, they have Industrial Design Studio, where only a select few Apple employees have access. The design team has their own reporting structures and report directly to the executive team. Apple’s Executive Team holds a regular Monday meeting to examine every single product that the company has in design phase at that point in time. One of the keys to Apple’s success is that they don’t work on hundreds of new products at once. Instead, resources are concentrated on a handful of projects that are expected to bear fruit rather than being diluted over many lesser projects.

Steve Jobs along with Apple's top executive in Design Studio

          Earlier this year, Apple came out with its iPhone 7. iPhone 7 is considered their one of the least innovative phone. But, still it had a good design and was able to generate enough sales. According to some reviewers, Apple seem to be too focused on Design and leaving out features included in phones. Many think that the next iPhone, their 10^th anniversary phone, would be one of the most advanced and the most innovative phone. Let’s hope for the best.

Ch. 8 - Segmenting and Targeting Markets

In 2014, when Apple realized that the market for “phablet phones” was increasing and the customers were opting out for its business rival Samsung. To address the demand, they released the new iPhone 6 in two variants. They increased the screen size of its base model and released another 5.5-inch screen variant to compete with Samsung for the target market. A year later, when they thought they were losing its own customer base, customers who preferred the traditional small-sized iPhone. Apple released new 4-inch iPhone, called iPhone SE, which look very much like iPhone 5 and 5s packed with the latest technologies including A9 processor, Apple Pay and a 12mp Camera.

Besides providing specific products for precise target market, Apple also uses strategies for segmenting the market such as Geographic segmentation. Apple’s use of Geographic Segmentation can be clearly evident from the uneven distribution of their retail stores. Domestically, Apple has 53 stores in California and 21 in New York. Out of 21 stores in New York, it has 7 stores in Manhattan. Here, we can clearly see Apple Inc. using income segmentation. California and New York are the states with some of the highest buying powers and Apple clearly don’t want to miss out on any of that dollar. On other hand, India with the world’s second largest population but relatively low buying power has no Apple Retail Store yet. Apple also uses psychographic segmentation, which appeals to our personalities, attitudes, motives, and lifestyles. Apple has always tried to promote themselves as lifestyle brand and has been successful to do so mainly among tween and teens.

Ch. 15- Marketing Communications

Apple has a comparative advantage over its competitors – it’s brand name. Apple has successfully set-up their brand as a luxury cellphone brand. Apple’s promotion strategy begins by introducing their new iProduct in front of a small group of people. Just like every other company, Apple Inc. strive for increase sales of their iProducts. Apple Inc. also uses AIDA (Attention, Interest, Desire, Action) concept in their promotional strategy.

Attention: As I said earlier, Apple start promoting their new iProduct by introducing it in an event, where they will explain how the product will help our daily life easy and also how the new product is better than older version. This keynote events are usually secretive, unless some insider leaks the information. Apple’s doesn’t directly promote on social media, but it asks various blogger and various Tech Reviewer to review its product and in process promote it to the world. Apple also uses traditional media very effectively to market their product. They promote their iProducts through commercials, magazines and newspaper ads and also situate billboards at some of the busiest locations.

Interest: For its iPhone 7, Apple created an Ad campaign called “practically magic”. In the series of Ads, Apple tried to demonstrate various exclusive features of iPhone 7 and 7 plus. They also conducted hands-on demonstration in Apple Retail Stores and also at four major phone-carriers’ stores.

Desire: For the new iPhone 7, creating desire in customer was Apple’s biggest issue. Since, iPhone 7 was considered very similar to iPhone 6 it was a challenge to sell it to customers. But, Apple was aware of the challenge beforehand and they started to advertise their new phone by comparing it to their older iPhone from the keynote event itself. Apple’s ad campaign “practically magic” also highlights this features, namely, the stereo speakers embedded in new iPhone, the water resistant feature, their new expressive iMessage feature and also the Dual Camera in iPhone 7 plus.

Action: Apple is still continuing to persuade its Target market to buy its iPhone 7 through lucrative Ads. They are also offering Apple Upgrade Program, where customer can get new iPhone every year for a small monthly fee. The four major phone-carriers are also offering some very good promotional offer. So far, Apple haven’t done good enough to meet its previous iPhone sales. Since, a lot of customers thought it wasn’t worth to buy a new iPhone, instead wait for the next iPhone, their 10^th anniversary iPhone, which is expected to have some very awesome features and an all-glass design.

Ch 10. Product Concept

Apple iPhone’s design is one of the main reason it has been able to take the cell phone industry by storm in such a small time span. Today, Apple is world’s second largest cell phone manufacturer. Apple’s iProduct can be called a shopping product, because it is "more expensive than a convenience product and found in few stores," but, yet Apple products enjoy the status of specialty products, thanks to Apple’s marketing team. Apple retail store plays a major role in portraying this image. They offer the boutique like experience on personal basis.

          Apple’s product mix consists of iPhone (cellphone), iPad (tablet), iPod (portable music players), MacBook (laptops), iMac (desktop computer) ,iWatch (smartwatch) and many more. It also sells headphones under the brand name of Beats and Airpods, the wireless Apple branded headphones which comes out later this year. Apple product mix components further breakdown into different sub category with few hardware tweaks and price difference. In 2014, Apple extended their iPhone line by including a 5.5-inch screen phones, providing an alternative for Samsung’s phablet phone lovers.

Most of the design success of iProducts can be credited to one person, Jonathan Ive. Ive is currently Apple’s Chief Design Officer (CDO). He is the designer of many of Apple's products, including the MacBook Pro, iMac, MacBook Air, Mac mini, iPod, iPod Touch, iPhone, iPad, iPad Mini, Apple Watch and iOS. He has also contributed towards Apple’s retail store designs, one of the famous one is the 5^th Avenue Store in NYC.  Ive is one of only four C-level executive at Apple along with CEO Tim Cook, CFO Luca Maestri and COO Jeff Williams.

Ch. 17 - Personal Selling and Sales Management

Apple heavily invest in sophisticated Apple Store Associates, otherwise known as Apple Specialists.  Apple Specialists are well-trained to help customer and make sales. Apple believe in empowering their Retail employees, meaning one could get his needs met by usually the first employee he sees in the apple store.  Apple store associate are proficient in answering all the question and guide the customer through their product, something we call consultative selling.  Apple Specialist uses non-aggressive approach to make the sale. Instead of forcing the customer to buy their product, they make them comfortable enough with their iProducts and make them fall in love with it.

          Apple also enforces relationship-marketing. One of the biggest strength of Apple is its Brand loyal customers. And Apple would have never been able to achieve it without its exceptional customer service. One of the service Apple offers its customer is a Walk-through session. When someone buys a new iProduct, Apple offers them a free Walk-through session, which helps the customer get more familiar with the product. The Walk-through session can be conducted in any Apple Store or through Video-calling. 

Ch. 16 - Advertising, Public Relations and Sales Promotion

Apple is the highest valuable U.S. brand valuing at $124 billion. They are also one of the biggest and best marketed brand. Their advertising budget for 2015 reached a record high of $1.8 billion.

Apple believes in simplicity when it comes to advertising for their iProducts. Their ad campaign “practically magic”, for their latest product iPhone 7, communicates some of its signature features through interactive story-based short clips. They do not feature any lengthy list of product features, no mention of price, no background voice talking about benefits of buying apple, or even information on how to buy an iPhone. This group of ads communicates the new design, the water resistant feature and the low-light camera.

Even their ad hoarding follows the same principle of simplicity. Apple tries to keep them as simple as they can get. Last year for iPhone 6s cell phones, Apple advertised the photos captured through the iPhone 6s to advertise the camera clarity. Their hoarding only had the photo along with the photographer’s name and the Apple logo. Some of these hoardings were placed in the passage that connects Times Sq. Station to Port Authority Bus Terminal, one of the busiest route in NYC.

Apple doesn’t offer Promotional sales. One could never find a sale or clearance sign in Apple Stores or any coupons related to iProducts. Although, Apple do offer Back-to-School sale promotion once a year for Students and also offer Educational pricing for Macs and iPads. For their iPhones, the major carriers of US offer special pricing with some of them even offering iPhone for free with contracts.  

Ch. 14 - Marketing Channels and Retailing

Apple Inc. has 486 apple branded retail chain stores in 19 countries, with 267 of them here in United States and about 7 of them in NYC. It also has the online store available in 39 countries. The level of service Apple stores offer are significantly high. Some of their signature services includes workshops where you can learn more about your iProducts and apple software applications also, they have Genius Bar where customers can receive technical advice or set up service and repair for their products. Apple retail stores are a very important part of Apple Inc. marketing strategy.

          Recently, I had a chance to visit one the flagship Apple store, the Fifth Avenue Store in NYC to receive help with some technical difficulties on my new iPhone 7 plus. One of the thing I like about the Fifth Avenue store is that it is open for 24 hours a day and 365 days of the year. The glass cube entrance with an Apple logo make it stand out in the lime light of 5^th Avenue. On asking about the all-glass staircase one of the Apple Store employee told me that they are not just any ordinary staircase, Apple has patented them and they could be found in many different Apple stores across the world. He told me that one the reason for the glass staircase was to attract customers to visit different floor in the stores. The Apple Fifth Avenue Store is Apple’s most architecturally innovative store, featuring a distinctive 32-foot glass cube designed by Bohlin Cywinski Jackson. They had a high amount of floor stock for all their products allowing customers to first-hand experience their new cell phone or laptop or tablet with the help of empathetic Apple employees. According to Apple, Apple stores aren’t like regular stores where you go in, buy the product and get out. They want the customers to stay, experience the product, ask question to their genius bar and get out with an iProducts and satisfaction. The stores are carefully designed to evoke the right “feeling” when you step inside. Warm lighting, monochromatic color schemes, and the layout of store features all appeal to the shopper’s senses, without feeling cold and impersonal.  

       Besides Apple retail stores, Apple Inc. also has an e-tailing websites apple.com. One can receive the same dynamic service through the comfort of his/her house. They offer one-to-one session via video calling with the genius bar. They also offer next-day delivery for most of their products in a bunch of locations including NYC. One can find answer to any questions regarding their iProducts on their website and can also chat with an Apple representative regarding his/her purchase. You can also register for a video-calling to help set-up your device once you buy it.

Ch 6. Consumer Decision Making

What drives the consumer to purchase an iPhone? Some would say it’s the features, while others would argue over its design. According to me, Apple’s iPhone gives you more of hedonic value than utilitarian value. That is, it gives us good feeling and satisfaction. Apple has gone on to become one of the world’s strongest tech brand through its marketing tactics.

                When purchasing an iProduct, consumers are driven by social factors and psychological factors. The external stimulus for iPhone can be created through a number of mediums. Some of them includes social media, TV, magazine and also sometimes just by walking past those big hoardings. Apple also offers its customers accessories options that can be bought separately, along with its iPhones which includes the wireless headphones Airpords, iWatch etc.

                Some of the nonmarketing-controlled information source includes thousands of YouTube channels that review tech products and also, websites like Cnet and many more. One of the best source for marketing-controlled information is Apple branded stores and also apple.com.

                Apple has also started to offer financing through its credit partner Barclays Card and also through various carriers. This allows consumers a variety of options to pay for their iProducts. It also offers college student a special discount on some of its product line.

Ch. 5 - Developing a Global Vision

Last week, Apple opened its first store in Mexico making their total tally of retail stores 486 in 19 countries. It also has the online store available in total of 39 countries. Apple strive for globalization, out of its 486 retail stores 219 are outside United States. In the first quarter of 2016, iPhone’s market share was 14.8 percent, only below its main overseas competitor Samsung (23.2%). Apple had its first double-digit decline year on year, with iPhone sales down 14 percent. Even though, Apple's "upgrade program" in the U.S. has helped to drive sales in its largest smartphone market. But, Apple is yet to explore ways to reform their second-hand iPhones coming through the program in emerging markets.

Chine has been a troublesome market for Apple. During the third quarter of 2016 ended in June, Apple's sales in China suffered the worst hit, decreasing 33 percent year-on-year, according to media reports. Apple Inc. has set up a research and development (R&D) center in Beijing in order to boost their sales there.

Apple Inc. outsource their manufacturing jobs. Most of the manufacturing for Apple’s iPhone parts is done around the world, and they all are assembled in China. Apple contracts with a local Chinese company Foxconn to assemble its iProducts in china.

Moreover, Apple Inc. practices global marketing standardization i.e. they manufacture the same products for all the countries around the globe. Although, iPhones do have options for specific languages for non-English users. 

Ch. 4 - The Marketing Environment

Apple Inc. has been a leading innovator in the cellphone industry for the past decade. Earlier this year, Apple sold its billionth iPhone. Apple has a vast target market. It includes everyone from teenagers to Generation X, in its target market. Its iMessage emojis to iTunes service to more sophisticated, yet easy to use apps such as GarageBand and iMovie are all example of Apple’s component lifestyles products. Apple has a product for everyone from a teenager to a college student and from a businessman to a musician.

                In the recent years, Apple’s marketing environment focus has been on technological factors. Apple has been heavily investing in Research and Development. This year, so far it has already invested 10 billion dollars in R&D. Apple strive for innovation as its slogan says, “Think Different”. Apple’s recent risk of the removal of headphone jack is another example of its focus on technological innovation. Apple is also slowly trying to drive us away from our traditional laptops to its new iPad pro. Apple’s new ad “What’s a computer?” evident apple’s long-term marketing strategy with its iPad pro tablets

Ch. 18- Social Media and Marketing

Apple is the world's largest information technology company by revenue and the world's second-largest mobile phone manufacturer. But, has yet to open an official company account on any social networking sites. Apple doesn’t use social media marketing as extensively as its competitors.

            Unlike its competitors, they also do not use social media to introduce their new products. Apple have tendency to keep secret about their products until launch. Instead of using social media, Apple tend to drive consumers towards their interactive company website, www.apple.com . On their website, along with buying its products one can find anything and everything- from their product launch event videos to every detail about their product. One can also chat with apple specialists to resolve any issues.

            Although Apple Inc. doesn’t have any official account with @apple domain, it is present on the social media through its CEO Tim Cook and its other flagship services such as Apple Store, Beats and Apple Music. In 2015, they also started a twitter account, Apple Support (@applesupport) with focus towards improving customer experience. Apple Support share tips and tricks for Apple users as well as answer product and support questions. Even though Apple invest very minimal in social media marketing, its loyal customers helps comprehensively in marketing. We all have at least one friend or follow at least one page that will have posted about the upcoming iPhone 7 by now. Apple benefits a lot from third-party marketing carried through their customers and other Tech gurus and websites dedicated to Apple News such as, 9to5mac.com.

Ch. 2 - Strategic Planning for Competitive Advantage

Apple is the world's largest information technology company by revenue and the world's second-largest mobile phone manufacturer. Apple’s mobile phone, iPhone has taken the world by storm through its amazing iOS operating system along with its incredible design, since 2007. It was the first truly called “smart phone”. Having established a strong brand value, Apple iPhone still has a strong ongoing influence in the smartphone industry. Here is the SWOT analysis of Apple iPhone.

All generation of iPhones upto iPhone 6.

Strengths

• Brand Loyalty: An Apple loyal customer will proudly proclaim in front of the whole world that he is an ‘APPLE guy’ and will have an extensive debate with you, just to prove that Apple is better than Samsung. Apple’s customers are so loyal that they sold out the entire unit of their least innovative smartphone, iPhone 7 plus, in just 20 minutes from its pre-order inaugural. The brand loyalty of Apple iPhone user can be compared with that of Harley Davidson brand loyalists. Just like the HOGs, Apple customers proclaim themselves as proud iPhone owners. 
• Wide Developer Network: Google play came long after the Apple developer network. Before Google play or android even started, Apple had thousands of applications and games made and maintained through its developer’s network. Apple developer community is one of the strongest online community till date.
• Incredible Design: Thanks to Jonathan Ive, who was able to put Steve Jobs vision onto papers and create unique looking iPhone and also other various Apple products. Apple’s amazing design has been a driving force for many of the smartphone users to switch to iPhone.

Weaknesses 

• High Price: Apple’s products are expensive. Compared to their closest and biggest rival Samsung, iPhones charges its customers more for the same features. Due to increasing pressure from its competitors, Apple has now started to offer financing options and also phone upgrade options.
• Restrictions: There are many unnecessary restrictions on iPhones. There is no option for expandable memory, also the battery is non-removable. With such a high priced phone, customers expect more liberty. It also has restriction on choice. Unlike Samsung, they only have one option for mobile phone. iPhone lacks variety.

Opportunities  

• Market Potential: Smart phones are the rage nowadays and the market has no signs of getting any smaller in near future. With billions of smartphones users worldwide, Apple has great prospect to expand their market in satisfying their demand. There is plenty of market left to be covered in Asia. Also, People around the world are getting more and more depended on their phones for everything and Apple has an opportunity to fulfill their wants.

Threats 

• Android: The single biggest threat to Apple’s iPhone is the Android operating system. Google has taken the world by storm with its mobile operating system and android is poised to grow even further because it is free for all and an open-source OS.
• Samsung: Another threat to Apple’s iPhone is Samsung. With it’s large arsenal of mobile phones coming in all shapes, size and price, Samsung has made it convenient for lot of people. Samsung had really shown the world the power of android phones and has also brought android OS in cameras as well. Samsung is Apple’s biggest competitor with almost 21% of market share in mobile phones industry, as compared to Apple at second place with 10%.

Ch. 1 - Overview of Marketing (Brief History and Mission Statement)

Apple Inc. is an American multinational technology company, that designs, develops, and sells consumer electronics, computer software, and online services.  Some of it’s hardware products include the iPhone smartphones, iPad tablet computer, the Mac personal computer and the Apple Watch smartwatch.

Apple founders in 1984 (from left to right):
Steve Jobs, Ronald Wayne and Steve Wozniak

          Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne on April 1, 1976, to develop and sell personal computers. It was incorporated as Apple Computer, Inc. on January 3, 1977, but was renamed as Apple Inc. on January 9, 2007, to reflect its shifted focus toward consumer electronics.

"Apple I ", Apple's first computer

          Apple’s first computer, Apple I was single-handedly designed and hand-built by Wozniak. Sold as a motherboard, Apple I went on sale in July 1976 priced at $666.66 ($2,772 in 2016 dollars, adjusted for inflation).

Apple was incorporated on January 3, 1977, without Wayne, who sold his share of the company back to Jobs and Wozniak for $800. During the first five years of operations Apple’s revenues grew exponentially, doubling about every four months. Between September 1977 and September 1980 yearly sales grew from $775,000 to $118m, an average annual growth rate of 533%.

On December 12, 1980, Apple went public at $22 per share, generating more capital than any IPO since Ford Motor Company in 1956, and instantly creating more millionaires (about 300) than any company in history.

In 1984, Apple launched the Macintosh, the first personal computer to be sold without a programming language at all. Its debut was signified by "1984", a $1.5 million television commercial directed by Ridley Scott that aired during the third quarter of Super Bowl XVIII on January 22, 1984. The commercial is now hailed as a watershed event for Apple's success and a "masterpiece".

In 1985, a struggle for power developed between Jobs and CEO John Sculley, who had been hired two years earlier. The Apple board of directors instructed Sculley to "contain" Jobs and limit his ability to launch expensive forays into untested products. Rather than submitting to Sculley's direction, Jobs attempted to oust him from his leadership role at Apple. Sculley found out that Jobs had been attempting to organize a coup and called a board meeting at which Apple's board of directors sided with Sculley and removed Jobs from his managerial duties. Jobs resigned from Apple and founded NeXT Inc. the same year.

In 1996, the then CEO, Gil Amelio made numerous changes at Apple, including extensive layoffs and cut costs. After numerous failed attempts to improve Mac OS, Amelio chose to purchase NeXT and its NeXTSTEP operating system. The NeXT deal was finalized on February 9, 1997, bringing Jobs back to Apple as an advisor. On July 9, 1997, Amelio was ousted by the board of directors after overseeing a three-year record-low stock price and crippling financial losses. Jobs acted as the interim CEO and began restructuring the company's product line; it was during this period that he identified the design talent of Jonathan Ive, and the pair worked collaboratively to rebuild Apple's status.

Steve Jobs introducing iMac- G3 

On August 15, 1998, Apple introduced a new all-in-one computer of the Macintosh family: the iMac G3. The iMac design team was led by Ive, who later designed the iPod and the iPhone. The iMac featured modern technology and a unique design, and sold almost 800,000 units in its first five months.

During his keynote speech at the Macworld Expo on January 9, 2007, Jobs announced that Apple Computer, Inc. would thereafter be known as "Apple Inc.", because the company had shifted its emphasis from computers to consumer electronics. This event also saw the announcement of the iPhone and the Apple TV. The following day, Apple's shares hit $97.80, an all-time high at that point. Apple achieved widespread success with its iPhone, iPod Touch and iPad products, which introduced innovations in mobile phone, portable music players and personal computers respectively.

Apple's current mission statement is “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad."

         Apple has also used many other different catchy slogans in the past. Apple's first slogan, "Byte into an Apple", was coined in the late 1970s. From 1997 to 2002, the slogan "Think Different" was used in advertising campaigns, and is still closely associated with Apple. Apple also has slogans for specific product lines — for example, "iThink, therefore iMac" was used in 1998 to promote the iMac, and "Say hello to iPhone" has been used in iPhone advertisements. "Hello" was also used to introduce the original Macintosh, iMac ("hello again"), and iPod.