For the past 30 years, Apple, Inc. has been the pioneer in the computing industry with its landmark products. In 1976, the founders Steve Jobs, Ronald Wayne and Steve Wozniak introduced Apple Computers, Inc.
to the American public which revolutionized the industry. The logo for Apple, Inc. F. K. A as Apple Computers, Inc. is possibly the most recognizable logo in history.
It is just pure marketing genius on how they made this company a household name.For more than 3 decades, Apple, Inc. as introduced groundbreaking products and accessories that truly defy the technological barriers such as its Macintosh line of Mac computers and Mac OS X software or its more recent introduction of i-products, its most profitable line thus far. The company has experienced many transitions from its inception until today. From the dismissal of its co-founder Steve Jobs in 1985 to the plummeting sales in the 90’s to its triumph return in late 2000’s, name changes and updated logos however even with these transformations Apple has still remain a powerhouse in the industry.In this paper, I will examine how Apple have been able to maintain its stance in the industry by discussing their marketing mix (4p’s): pricing strategy, products offered, promotion strategy, and placement, their brand loyalty, the company’s marketing mistakes, branding identity (logos) and how Apple marketing has impacted us on a social, psychological, ethical, and political level.
According to Kotler & Armstrong (2010), “marketing mix is a set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market.The marketing mix consists of everything the firm can do to influence the demand of its product. ” (p. 52) Apple has successfully used the 4p’s: products, price, place and promotion to solidify their place in the industry. “Products means the goods-and-services combination the company offer to the target market” (p. 52) Apple is a US based computing company that focuses on the design and manufacture of hardware products such as Macintosh personal computers andMac laptops, then in the 2000’s expanding to consumer electronics devices (i-Pod’s and i-Phone) along with software applications: Mac OS X operating system, iLife multimedia for pictures, movies and music, and iTunes digital media player.
“Price is the amount of money one must pay to obtain the product” (p. 52) Apple is known to be a premium brand and it has priced its products accordingly. It does not try to compete with PC on pricing.They believe that the price takes in account the complete Mac experience of superior parts, industry-leading after sales support and its exceptional operating system. If Apple reduces its prices they will lose its position as a premium brand.
Apple products may initially cost more but they last longer, have minimal to no virus issues and overall have less problems. Apple does not appeal to the average user. Its plea is to the higher income bracket consumer who will not jump ship due to a temporary bad economy.Place includes company activities that make the product available to target consumers.
”(p. 52) Historically, Apple has had issues with retailers whose staff, though knowledgeable about the overall industry, were not well-versed with Apple products and relayed misinformation to consumers. This made it difficult for the consumer to learn how to differentiate the value of an Apple product vs. a PC’s. In response to this issue, among other things, Apple created the “App store” whose purpose is to provide the customer with the best possible user experience.
By creating a store that devoted itself to Apple products, it not only eliminated the problem of ill-informed employees selling their products but also allowed for an atmosphere that PC and Mac users can conjugate, get excited and explore the latest technology in the industry. “Promotion means activities that communicate the merits of the product and persuade target customer to buy it” (p. 52) It is reported by TechCrunch (2010), “the company’s advertising cost topped $691in 2010 million however as outstanding as that number sounds it only accounts for 1. 06% of their overall revenue. ( 2)To promote their products, Apple has used innovative advertising campaigns via podcasting, co-branding, TV commercials, wrap advertising, print ads and use of public posters. Its advertising focuses on the value for the money vs.
have the lowest price in the industry. It also uses the App Store to promote, demonstrate and assist customers with how to operate its new products and applications. Lastly, they use many major authorized retailers such as Wal-Mart, Best-Buy, Brands-Mart, Micro-Center or Target to display the i-product line, in particular, the i-Pods and i-Pads.According to InsideCRM (n. d), “when shoppers sleep outside of store just to be the first to buy an iPhone, it is obvious that Apple, Inc. is a company that enjoys fanatical brand loyalty.
” ( 1) Brand loyalty is described as the repetitive buying practices, satisfaction and trust that a consumer have to a particular brand. Brand loyalty is the foundation for Apple’s success. It is not something that is easily obtained. It takes meticulous planning combined with innovative marketing and the consistency of developing great products.As stated in InsideCRM (n. d.
), “this brand success is not a result of dumb luck or forces beyond Apple’s control; it’s part of a well-thought-out plan to deliver strong products and formed an Apple culture. ” (4) Apple creates an entire user process with its hardware and software applications. For example: the iPod and iTunes product combination. This halo effect of purchasing the hardware (iPod) and then downloading your music via their software (iTunes) is brilliant on the part of their marketing team.
In 1985, though an extraordinary year for sales, the company forced Steve Jobs to resign from the company he co-founded. His imperious and abrasive management style was cited as the reason for his ousting. However, in 1997 as Apple revenue and market share was rapidly declining, the company that was nearly bankrupt asked Jobs to regain his position as the company’s CEO. He accepted and implemented a new management style that now motivated employees and gave clear company objectives. After Job’s reinstatement, one of the changes made was to the logo from a multi-colored to a solid colored apple.
As an astute business man, he understood that an effective brand design is not fixed; instead it should evolve as the company evolves. The evolution of Apple, as a company, was apparent and forthcoming. They were entering into a new era; planning to infiltrate a new market of consumer electronics which proves to be a major turning point for the company’s growth. In October 2001, it launched the iPod however, due to the incident that transpired on 9/11 the new invention remained low key and for years to come the sales remained moderate, barely able to cover the R & D cost.
It’s been reported by Lloyd (2004), that “iPod sales were good but not fantastic until around the May 2003 release of the third-generation iPod, which marked a turning point in the sales history of the device. Prior to that release, Apple’s sales were directed initially towards a relatively small audience of Macintosh users. When they released the fully compatible PC version of the i-Pod the company saw a 220% increase in sales, selling 6. 45 million in just one quarter.
” To date, the company's performance is outstanding.Starret (2010) reports that “Apple said it sold 21 million iPods during the 2010 holiday quarter alone”… “If you annualize their 2010 quarterly revenue, it is now an astounding $50+ billion company” so as you can see since 2004 there have been a steady increase in the company’s revenues every quarter, despite the recession. Seeing numbers like this makes you wonder where Apple, as a company, would be if they did not change their marketing strategies of iPod compatibility with PC or if they had not entered the consumer electronic industry altogether.There has only been a few companies that has been able to penetrate the market the way Apple has however, even with the best marketing strategies every company has bottleneck factors that prevents them to fully exploring all opportunities and prospects. Vertygo Team (2010) points out that “the most serious mistakes Apple has done concern marketing and distribution strategies is in Europe.
Apple has overlooked the European markets, and missing big numbers in unexploited sales. With better marketing strategy, better communication and distribution, Apple could have made 300% more revenues in Europe in the last 4 years. ( 14). The entire United States has approx 300 million people and Western Europe, by itself, has a population of 350 million. With these numbers, it is surprising that in 2005Apple only had one App Store in the UK.
The stores provide consumers the ability to test, play and explore all of the new products. It is a good showcase for products and a great marketing tool to build customer relationships. I think that Apple is now beginning to understand the importance and potential revenue of this market.Currently, it has opened up approximately 50 stores across Europe, predominately in the UK but also in France, Germany, Italy, Switzerland and Spain.
They are beginning to gain market share in an otherwise untapped region. The next major restructuring of the company came in 2007 as Apple Computer, Inc. shortened its name to Apple, Inc. to incorporate their efforts and ventures into non-computer products such as the iPod, iPhone, and iTunes.
As mentioned previously, Apple, Inc. was entering a new era and they needed its visual identity to reflect this. The new logo would orrelate with their revised image.However, they were still careful to stay close to the heart of the original concept which is well-recognized. As stated by logoblog.
com (2007)…“The polished chrome logo seems to fit ideally. The silvery chrome finish in the new Apple logo is consistent with the sleek new design scheme of the iMac and freshens up the icon. ” (4). The right brand identity design can be one of the company’s strongest marketing tools as it translates the values of the company into a consistent image that consumers become familiar with.Kotler and Armstrong (2010), states that “brands are more than just names and symbols.
They are a key element in the company’s relationship with consumers. ” (p. 236) In the U. S, Apple has a shrewd marketing team that knows how to use social proof and psychology to affect product sales. They use tactics like scarcity, emotions and social proof to get consumers excited about their product. For scarcity, they know that an item’s value increases if it is presumed to be in limited supply.
For ex: For any of the iPhone launches they make sure the demand exceeds the supply, even producing pre-printed “out-of-stock” posters to put in iPhone retailers’ shop windows. Making the product scarce in this way increases its value and sends customers flocking to the stores. Emotions are also used to manipulate consumer buying, especially in commercials.They will use a dad, in the military, thousands of miles away putting his little girl to sleep via the iPhone or showing a father watching of his son Billy’s baseball game while getting a play by play commentary by the son… Billy is Cincinnati, OH….
Dad is in Tokyo, Japan on business travel. Social proof is used in combination with scarcity. If customers, knows an item is in limited supply and they have the mentality that they MUST be first to have it, these type of customers will camp out in front of a store the night before and then wait hours in line just to purchase the product on release day; this warrants news coverage which in turn brings attention and traffic to the stores.Apple’s marketing takes on ethical and political issues such as environmental protection.
They have departments that are set up to calculate the company’s carbon footprint. According to (“Apple and the Environment,” 2011), “We know that the most important thing we can do to reduce our impact on the environment is to improve our products. That’s why we design them to use less material, ship with smaller packaging, be free of many toxic substances, and be as energy efficient and recyclable as ossible.With every new product, we continue our progress toward minimizing our environmental impact.
” (2) Apple is also part of a vigorous recycling program and is takes social responsibility and ethics seriously. It make sure that its suppliers are aware they will not tolerate anything less than safe working conditions, fair treatment of employees and environmental responsible manufacturing process.Ethically, they want suppliers held accountable for certain business practices, regardless of what is accepted in their region. If it violates human rights and exploits children they will lose the endorsement of Apple. Together, with alternative employee commute program and reducing energy Apple is trying to play its part in going green and being socially responsible. Apple has had a tremendous impact on us socially.
They revolutionized the computing industry so many times in its 30 years of existence.From the introduction Apple II that capitalized on mass producing of personal computers to the invention of the iPod that took the consumer electronic industry by storm to the iPhone that prove to be a catalyst in the cell phone industry and most recently the iPad, a tablet, that creating a new category for mobile computing device. Apple has captured the hearts and mind of many consumers that are loyal to its brands. I am sure that Apple is one of the few brands that have had the greatest impact on our community and through more innovative products I am sure they will continue to vital part of lives.As we observed the evolution of Apple, Inc.
we witnessed the tribulation and the triumphs, the heights of their success and the depths of their failures however, with all the adjustments they have still remained an innovator in the computing industry. We have seen how the company uses the marketing mix (4p’s) to promote their products, has built brand loyal and how the company’s marketing has affected our buying practices on psychologically level, the responsibility it takes on a politically and ethically level and more importantly how it has impacted us on a social level.As for the brilliance of the Apple overall marketing strategies, it has made corporate history as being one of the most recognized brands. The symbol itself, illustrates what we have seen for the past 3 decades, a company that has brought innovative products, revolutionized the computing several times over and it exemplifies revolutionary ideas, defiance to establishment, boldness and a thirst for knowledge.
Let’s see what Apple has in store for us for the next 30 years.
