BUS104 – Introduction to Marketing
This assessment is designed to apply the knowledge and skills developed by the students to evaluate the external and internal environment of a company and identify new offering based on the result of the environmental scanning. In this assignment, the student is expected to analyses the external and internal environments (SWOT), identify a relevant strategy (S-0, W-O etc.), identify and describe a target market, and develop a suitable new product or new services for the company to introduce for this target market.
Each group has to nominate a company (the client) for this plan, Tutor needs to approve the company before it can proceed to the next stage.
Students are required to conduct a SWOT analysis, identifying the internal strengths and weaknesses and external opportunities and threats of the company. The goal of a SWOT analysis is to identify the critical factors that may affect the proposed business concept (or new product or new services) and then build on the strengths to reduce the weaknesses, exploit opportunities and avoid potential threats. Students are also expected to identify and describe using segmenting variables, one target market being served by the nominated client and devise a brief marketing strategies.
Groups need to base their marketing report on appropriate theory and other relevant current market information where possible. Groups should support their report with the text and a minimum of FOUR (4) other academically relevant and acceptable sources. These may include academic journal articles, research reports and industry analyses, but groups need to be aware of the validity of sources e.g. an unsupported newspaper article may not be considered valid.
Executive Summary, half a page summary contains the key findings of the report.
Section 1: Introduction and background to the company
Section 2: Analysis of the marketing environments (external and internal environment) and present the summary in SWOT table
Section 3: Recommendation
Section 4: Conclusion and Recommendation
BUSINESS ANALYSIS OF APPLE
The aim of the current research is to analyze the business process and outcome of Apple and its marketing procedure. In the current research, there is identification and discussion of the issues of Apple and therefore, providing necessary recommendations. The marketing recommendation includes the initiation of new product which is Apple tv. It would help in resolution of the issue of the company such as limited stores and targeting the only higher income group people. Therefore, it would help in ultimate market expansion and customer base increase.
Section 1: Introduction and background to the company
Apple Inc. is a technological company headquartered in California. At present, it is one of the most well known technical companies known for its products across the world and therefore, is one of the leading multinational companies. The headquarter in California is entrusted with the task of designing the products and deciding the new products that are going to be initiated in the market (apple.com, 2019). The company excels both in software and hardware services. The online services of the company are Apple music, iCloud, Mac App store and itune stores. The hardware products of the company are i-phone smartphones, Apple smart watches, Homepod speaker and Apple digital media player. The software used in the products is also manufactured by the company; which are macOS and IOS (apple.com, 2019).
The purpose of this report is to find out the various aspects associated with the business procedure of Apple and examine its external and internal business environment. The detailed marketing analysis would help in finding out the strengths and weaknesses of the company in form of SWOT framework. Furthermore, the segmentation strategy, targeting strategy shall also be proposed and alongside the 7p’s of marketing is taken into consideration for recommending marketing aspects for the company. at the very end, there is conclusions and recommendations.
Section 2: Section 2: Analysis of the marketing environments (external and internal environment)
Table 1: SWOT analysis of Apple
(Source: created by the author)
In the electronics industry, Apple is one of the significant brands and it is well known and has an established market in different nations. In the opinion of Wesley and Barczak (2016), currently, Apple leads the race in terms of multinational technological companies. The company also ensures high quality of its products including a range of software which are manufactured by the brand itself. Henceforth, as a result of that, there is confidence of the customers on the brand and it has gained the loyalty of the customers. This has added to the positive brand image as well. As stated by Chen and Ann (2016), the strong brand image adds to the profitability of the company while initiation of new products and henceforth, it enjoys a strong profit. The premium pricing strategy of the brand also adds up to its profitability which is its strength. Henceforth, this pricing strategy has contributed to the earning of good profit even with the limitation of sales.
The distribution network of Apple is limited. As mentioned by Khan, Alam and Alam (2015), the limitation in the number of stores and dealers is because the company aims towards making itself exclusive and henceforth, it does not operate its business everywhere. Henceforth, there are limited authorized centers of the brand which is one of its major weaknesses. This is because this creates a limitation in the accessibility of the number of customers. Along with that, the premium pricing strategy of the company has resulted in the targeting of the higher income group people only and therefore, the customer base is limited. According to writer (2018), the customer base of the brand comprises of high or middle-high income group people and therefore, there is entry of the low income group people on buying the products of this brand. This strategy represents a weakness of the brand because of the lower number of customers in the higher income group age and the majority of the population comprises of lower and middle income group people.
The primary opportunity of the company shall be the expansion of its distribution network. Henceforth, as influenced by Laudon and Laudon (2016), this strategy shall easily help out curb the weakness of the company and also account into greater accessibility of its customers. This shall not only be beneficial for the local market, but also for the global market. In addition to this, the company shall also focus on the increase of its sales volume and for that purpose; aggressive marketing strategies shall b adopted. This would be advantageous for the brand owing to the rising demand of electronic products such as smart phones and televisions. Furthermore, any new product initiation of the brand shall also be beneficial owing to the positive brand image of Apple and it shall readily catch the attention of the people. It must be noted in this regard that the new product shall be equipped with innovation (Kashmiri and Mahajan, 2015). This would support the growth of the company in the international electronics market.
In the current era, there is huge increase in the demand of the smart phones and other electronic brands. Henceforth, a number of brands are emerging into international market. As a result of that, Apple has a number of competitors currently in the international market such as Sony, Samsung (Seifert, Tancrez and Biçer, 2016). Furthermore, these brands are also providing electronic products at a lower rate which is limiting the customer number of the company as the products of this company have a huge price. Along with that, the competitors are also adopting a number of strategies to keep themselves competitive in the market. As a result of that, the need for Apple to implement more aggressive strategies has been more important. As studied by Gandomi and Haider, 2015), the high labor cost of contract manufacturers in China shall also be a threat owing to the decline in the profit margin of the company.
Section 3: Recommendations
a. Target market
In accordance with the SWOT analysis of the company, it has been understood that the brand needs to come up with a new product in the market to keep itself competitive. As influenced by Chernev (2018), the new product shall be effective enough to bridge the loopholes that are there in the brand and are providing hindrance to the growth of the brand in the international market. Henceforth, the proposed new product of the brand is Apple tv. The initiation of the new brand has been done with the help of the segmentation strategy. The segmentation strategy of the brand has been done on the basis of demographic; in which age of the customers is the primary factor. The age of the customers is divided into 20-45 years, 18-30 years and 20-35 years age category. Along with that, the age of the people has also been taken into consideration and the segmentation has been done on the basis of the income. The different segments as per their income are lower income group, lower-middle income group, upper-middle income group and upper income group. Based on these two segmentation; the targeting strategy of the brand is to target the age group of 20-45 years. As observed by Wesley, and Barczak (2016), a majority of the population in the selected age range is inclined towards television. Moreover, the need of television has increased in this age group and therefore, the new product initiation of Apple shall meet the needs of this sector. The targeting strategy as per the income difference is to sell the products at moderate profit. Henceforth, the pricing would be average and not premium to gain customers from the lower-middle income group section as well.
b. New product and service description
The television that shall be initiated by Apple shall be full HD. As influenced by Chen and Ann (2016), the aim of the company is to be superior in terms of the quality of the products it caters to its customers. Therefore, the resolution used in the television would be 1080*720 fps to provide the most premium quality to its customers. The TV initiated by Apple may be a computerized TV broadcasting program where the broadcast transmits widescreen pictures with more detail and quality than found in a standard analog television, or other advanced tv groups. Henceforth, digitized system has been selected for the brand owing to the superioty of the brand in the international market. The initiation of this new product shall be beneficial for maintaining its superior position and also attract the customers of the middle income group people. HDTV could be a sort of Advanced Tv (DTV) broadcast, and is considered to be the most excellent quality DTV arrange accessible (Khan, Alam and Alam, 2015). The cargories of HDTV shows incorporate direct-view, plasma, raise screen, and front screen projection. HDTV requires an HDTV tuner to see and the foremost point by point HDTV organizes is 1080i.
c. Marketing mix strategies with the help of 7ps of marketing
Price is an important factor that shapes the mind and buying behavior of the consumers. The issue that persisted with the pricing strategy of Apple is its premium pricing as a result of that, only upper and upper-middle income group could afford the products of the company. As influenced by Abdul-Hamid et al. (2017), the pricing strategy of Apple tv would be made with generation of moderate profit amount and henceforth, the pricing would be average. This would be beneficial for attracting an increased base of customers.
The new product initiated by Apple is a television. The new product initiation of Apple would be full HD. In the opinion of Mallik and Farhan (2018), the emphasis of the company has been given in terms of the quality of the items it caters to its clients. Hence, the determination utilized within the tv would be 1080*720 fps to supply the foremost premium quality to its clients. The TV started by Apple may be a computerized TV broadcasting program where the broadcast transmits widescreen pictures with more detail and quality than found in a standard analog tv, or other progressed tv bunches.
The issue persisted in the brand in terms of its place strategy is the limitation of the dealers it works with. According to Boonpradub and Thechatakerng (2015), the brand aims to maintain its exclusivity and therefore, only authorized dealers of the brand get to sell Apple products. However, the issue is the limited accessibility of its customers. The new place strategy would include locating the stores at the digital stores where television from different brands are sold. The new tv initiated by Apple would be sold alongside other brands which would help in the expansion of the customers’ accessibility. There would be increased customer and profitability of the company.
The promotional strategy would be luxury pricing strategy as that would result in the gathering of increased amount of customers. According to Schultz (2017), luxury marketing strategy would bee beneficial for the brand as there is a pre established brand image of Apple and henceforth, the promotional strategy would be an important factor in furthering impacting the brand image on the customers. The high definition and superior quality of the product is itself an effective strategy. The promotion and marketing would be done through advertisements.
The people of this new product of Apple consist of the age range of 20-45 years. As stated by Abdul-Hamid et al. (2017), a majority of the population in the selected age range is inclined towards television. Furthermore, the people also includes the ones with lower middle income level as they form majority of the population and targeting them would be beneficial for the expansion of customer base. Moreover, the need of television has increased in this age group and therefore, the new product initiation of Apple shall meet the needs of this sector. The targeting strategy as per the income difference is to sell the products at moderate profit. Henceforth, the pricing would be average and not premium to gain customers from the lower-middle income group section as well.
The process includes targeting the ones who have not been able to avail the products of the company. As studied by Mallik and Farhan (2018), the issues were the high price or the limitation of the stores. Henceforth, the new product has been initiated in accordance with the issues where the pricing is moderate and the stores include a number of digital stores, which shall help in the increase of the customer accessibility.
The product shall be touched by the customers before they could opt for their buying decision and thus, the physical evidence is tangible.
Section 4: Conclusions and recommendations
On the basis of the findings and discussions in the current report, it can be summarized that Apple is one of the most well known multinational electronic brands. The strengths and the factors that have added to the well being of the company is the good brand image and high profitability. However, certain issues are there such as high price which makes it difficult for the middle income group people to avail the products of the company. Therefore, the strategy used by the company is the initiation of a new product which is a television by the brand. The purpose of initiating the new product is to resolve the issues that occurred in the company. The segmentation strategy includes demographic distinction as per the income and age of the people. The targeted market is the age between 20-45 years and middle income group. The pricing strategy of Apple tv would be made with generation of moderate profit amount and henceforth, the pricing would be average. The new place strategy would include locating the stores at the digital stores where television from different brands are sold. The promotional strategy would be luxury pricing strategy as that would result in the gathering of increased amount of customers. The new product has been initiated in accordance with the issues where the pricing is moderate and the stores include a number of digital stores. Lastly, the marketing analysis shows tangibility of the new product as the physical evidence.
The recommendations of the company include the betterment of the promotional strategy. Apple has a strong brand image and, henceforth, in order to further put the impact on the consumers with the new product of the company it shall use its brand image as one of the significant promotional strategies.