Apple, the iconic technology company, has continuously captured the cell phone market with its new and innovative features, products, and services.
This iconic brand status has allowed them to maintain higher prices for the higher-quality products. However, the competition is quickly able to copy and then enhance new technological innovations, and is doing it at less-expensive prices than Apple. This has caused a shift in the cell phone market, and Apple is losing share. This marketing plan will identify and plan for the release of Apple’s newest product, the iPhone 5s, in domestic and international markets.
Situation AnalysisMarket SummaryThe target markets for iPhone 5s are the established and loyal Apple users, middle to upper income individuals with disposable income, those who like to have fun with technology, music fans ages 12-35, and professionals in media, design, and information technology (IT). Market NeedsThe target market requires new technology to keep them interested in a product. Faster processing speed, useful apps and features, and cutting-edge technology are features the market needs to be lured away from the competitor. Apple has made improvements in processor speed, camera resolution, and added security with a fingerprint-scanner that can unlock the phone with just a touch. A new feature, the "A7 Motion co-processor" chip, can track motion data continuously without heavily draining the battery. The chip opens the door for the iPhone to better track sports and fitness-related user activity.
Market GrowthApple’s share of the market has slowed in the last few years as the sales of the Samsung Galaxy have taken market share. The market is numb to new cell phones. Now Apple hopes a “bigger emerging-market presence can help reverse a 29 percent fall in the company’s share price since it hit a record high of $702.10 a year ago” (Gupta, 2013, para. 19). The selloff was fueled by fears of slowing growth and a perception that Apple’s ability to innovate and shake up industries was dwindling.
In China, Samsung is still the number one selling cell phone, with Apple only having about 8% of the market share (Kan, 2013). It would take significant innovation to begin to win the market share in China.Potential Competition Samsung has a wide range of products and prices. Nokia and Android are also potential competitors who offer near-filed communications and inductive charging.
Apple introduces a new phone and Samsung introduces cheaper versions with more options and offers more tools to the user.Product OfferingiPhone 5s features the first smartphone with 64-bit desktop-class architecture giving it extremely fast performance that fits in the palm of the customer’s hand. Other features include the 8 megapixel iSight camera with True Tone flash, the new fingerprint identity sensor (Touch ID) that can unlock the users screen with one finger, iCloud for more storage, and a beautifully crafted case in various colors. iPhone 5s is faster, has twice the graphic performance, and a longer battery life improving power and efficiency (Apple, 2013). Having confidence in its product and service, Apple offers a better customer experience with the iPhone 5s for its target markets.Product IdentificationThe Apple iPhone 5s was introduced in 2013 as the most forward thinking smartphone in the world (Apple 2013).
In corporations around the world, the Blackberry has been replaced with the iPhone. iPhones are instrumental in helping businesses connect in new ways not heard of before. Apple is better with converting Android users to Apple products, and the percent of customers who remain with Apple is larger than the customers who switch to Android and stay with Android. Most Apple customers identify with Apple’s products and their reputation for making dependable, reliable products.Marketing Strategy With major competitors in various markets, Apple pursues product differentiation as its main business strategy, and this is achieved by offering fundamentally innovative and revolutionary products to its target markets. Apple has solidified itself as the first-mover in its industry with respect to product differentiation, but it is the actual product features that will create value and a competitive advantage for the company.
Justification for Product ChoiceBecause Apple operates in a highly competitive business environment where products’ life cycle can be as short as several months, the launch of the iPhone 5s with its new operating system (iOS7) and great new features make it easily differentiable from all other smart phones. The product differentiation not only will help Apple maintain its competitive advantage, but also achieve a steady increase in market penetration and profitability.Marketing ResearchApple’s monthly survey of iPhone buyers will reveal, country-by-country, what is driving its customers’ decisions to purchase Apple’s iPhone products versus other products, such as the Android products that Samsung sell. The results of the survey will also provide detailed information on which features and attributes they most use, demographics, consideration of other brands, and their level of satisfaction with different aspects of the iPhone (Heisler, Y, 2012). The conclusions deduce from these surveys will help Apple understand how the preferences of customers, for example, in France differ from those in the United States.
