Introduction

Apple Inc. is an American multinational corporation that designs and manufactures

consumer electronics and computer software products. The company's best-known
hardware products include Macintosh computers, the iPod and the iPhone. Apple software
includes the Mac OS X operating system, the iTunes media browser, the iLife suite of
multimedia and creativity software, the iWork suite of productivity software, Final Cut
Studio, a suite of professional audio and film-industry software products, and Logic Studio, a
suite of audio tools. The company operates more than 250 retail stores in nine countries
and an online store where hardware and software products are sold.

Established in Cupertino, California on April 1, 1976 and incorporated January 3, 1977,the

company was called Apple Computer, Inc. for its first 30 years, but dropped the word
"Computer" on January 9, 2007 to reflect the company's ongoing expansion into the
consumer electronics market in addition to its traditional focus on personal computers.
Apple has about 35,000 employees worldwide and had worldwide annual sales of US$32.48
billion in its fiscal year ending September 29, 2008.For reasons as various as its philosophy
of comprehensive aesthetic design to its distinctive advertising campaigns, Apple has
established a unique reputation in the consumer electronics industry. This includes a
customer base that is devoted to the company and its brand, particularly in the United
States. Fortune magazine named Apple the most admired company in the United States in
2008 and in the world in 2009.

Marketing Strategy of Apple Inc – Apple

Marketing Strategy
January 11, 2019 By Hitesh Bhasin Tagged With: Strategic Marketing Articles

Apple is the largest brand in the technology industry in terms of its revenue
generated as well as its brand ranking. It is not a surprise to many because Apple has
time and time again presented products which were ground breaking and which
revolutionised the market.

Apple has given us many delights over the years including the Macbook, the Ipod,
Iphone, Ipad, Iwatch, Itunes and others. And due to its excellent product and
differentiation, it is close to the heart of many techie enthusiasts.

Page Contents

Here is the Marketing strategy of Apple

Segmentation targeting and positioning of the brand
There are three major segments which Apple targets. It generally uses
lifestyle segmentation as Apple is the most premium brand out there. The segment
is usually the urban population with enough buying power for purchasing Apple
products. These are people who are early adopters in life but the brand equity of
Apple is such that even laggards have started adopting the products.

In the Marketing strategy of Apple, it has three target groups

1. One is the music lovers who are targeted by the Apple Ipod and Itunes.
2. Another target the professionals or even teenagers who are targeted for Apple Iphone,
Tablets, Macbook and other such gadgets which can be used by anyone, irrespective of
age.
3. And third is the crowd which can use their other products and services like Apple TV
and Apple Iwatch. They also use Ibooks, Apple pay etc.

Apple being the world’s number 1 brand has the topmost mind positioning and there
is no doubt that when someone talks about Smartphones or Laptop or Tablets, Apple
is the first brand that comes to mind maximum number of times.

Marketing mix in the Marketing strategy of Apple – Click here to read

the Marketing mix of Apple, Apple Iphone and Apple Ipad.

SWOT analysis in the Marketing strategy of Apple – Click here to read

the SWOT analysis of Apple Inc as well as SWOT analysis of Apple Iphone.
Mission in the Marketing strategy of Apple
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.

Related: Marketing Strategy of Bentley - Bentley Marketing Strategy

Vision in the Marketing strategy of Apple

We believe that we are on the face of the earth to make great products and that’s not
changing. We are constantly focusing on innovating. We believe in the simple not
the complex. We believe that we need to own and control the primary technologies
behind the products that we make, and participate only in markets where we can
make a significant contribution.

We believe in saying no to thousands of projects, so that we can really focus on the

few that are truly important and meaningful to us. We believe in deep collaboration
and cross-pollination of our groups, which allow us to innovate in a way that others
cannot. And frankly, we don’t settle for anything less than excellence in every group
in the company, and we have the self- honesty to admit when we’re wrong and the
courage to change. And I think regardless of who is in what job those values are so
embedded in this company that Apple will do extremely well.

Tagline – “Think Different” is one of the best slogans in the tech industry. Many
people assume that Apple launched the slogan “Think different” in response
to IBM’s slogan “Think”. However, since 2002, Apple stopped using the slogan in
its marketing. But from time to time, the slogan has bounced back on Apple’s
website or in their marketing and it has never left the mind of Apple loyal consumers.

Competitive advantage in the Marketing strategy of Apple

Apple has several competitive advantages over its competitors

1. Superior technology products – Macbook and Iwatch are clearly leaders in their market
space because of the OS and the technology used.
2. Brand equity – Apple has repeatedly taken the top spot for its brand equity and has a cult
following since ages.
3. Revenue over time – Apple has deep pockets due to its high margins.
 4. R&D – A major competitive advantage of Apple is the amount it spends on R&D
keeping its eyes on the future rather than on the present.

BCG matrix of Apple

When plotting the BCG matrix of Apple, the product portfolio of Apple is clearly
divided into four parts.

1. The Cash cows are products which are existing since ages and which cannot be
challenged in the current market conditions and have a majority market share when the
global data is referred – These are Macintosh, Iphone, Iwatch (50% market share in
2015) and Itunes (a solid support service to all Apple products)
2. The stars are Ipad and Ibooks where there is a lot of competition and Apple has to invest
a lot to keep these businesses on top.
 3. The question mark is Apple TV which has low market share in an industry which is
showing great potential and might grow at a rapid pace in the future.
4. The dog is Ipod because although it has a high market share, the industry itself is rapidly
degrowing because Smartphones have replaced Ipods.

Related: Marketing Strategy of Dove

Distribution in the Marketing strategy of Apple

Apple has a very smart retailing setup. It has around 450 stores within the US. And
these retail outlets are such that they are more focused in helping the customer and
making him comfortable with using Apple rather then selling the product and
stuffing the product down customers throat.

Apple has also introduced the Apple Genius Bar, which is a walk-in service center
and can help any customer in problems they are facing in MacBook or Iphone or
Ipad. Overall, the company owned Retail and Service outlets are great.

Along with company owned stores, Apple has set trade partners like Ingram Micro
and Redington which are responsible for the sales and distribution of the brands.
These trade partners will buy in bulk from the brand and then distribute the
product in the market. Thus, besides its own retail stores, Apple is found present in
other modern and premium retail stores. These stores are covered by its retail
partners.

The Online E-commerce presence of Apple is fantastic. Most E-commerce portals

promote the brand themselves because they know that the brand is in huge demand.
Besides this, there is very less price penetration in Apple, and hence the channel
partners and E-commerce portals are happy too as they don’t have to fight on
price. from the home page itself. The combination of retail, distribution and E-
commerce gives a complete market reach to Apple.

Brand equity in the Marketing strategy of Apple

Apple has the highest brand equity in the world as of 2016 and it is the topmost
ranked brand in the world. The brand worth of Apple is 118.9 billion dollars. The
brand has done a lot to reach this brand equity, but a major contributing factor was
its ability to give hit products back to back, and to reach across the globe with these
excellent products. The combination of both with the excellent marketing
communications of the brand help Apple reach the highest brand equity possible.
Competitive analysis in the Marketing strategy of Apple
Although on a company level there is very less competition for Apple, on product
levels, there is repetitive competition for each of its individual products. Ipad faces
competition from Samsung tablets, Iphone faces major competition
from Android based phones, Macbook is facing stiff competition from Dell which
also has superior products.

The unique services offered by Apple such as Itunes also face competition from
other online music players which are cropping up every day. Ibooks faces strong
competition from Amazon and even Apple TV faces competition from Fire TV
of Amazon. Samsung gear and other smart watches are rising competitors to Iwatch
although Iwatch still holds a majority market share.

Related: Marketing Strategy of Cisco - Cisco Marketing Strategy

Promotions in the Marketing strategy of Apple

Apple is one of the most elegant advertisers as can be seen from any of its print ads
in newspapers. You will commonly find Apple ads to be clear and crisp in
their message. Their background will be white and there will be a splash of colors on
the print ad introducing the product or differentiating the product.

And that is one major strength of the brand. Apple has so many differentiation points
that it can have a slew of ads, all targeted towards differentiating the products that it
is offering. Not only the print ads, even the video ads do the same. They tell you one
point which highlights the product features.

Here is a simple image made by Apple to differentiate between PC and Macintosh.

Look at the clean and to the point copy.
Overall, the advertising and promotions of Apple are used tenfold when there is
a new product launch. The hype created is so much that you just can’t ignore it. And
this hype is continued until the product becomes a success. As the number of
products with Apple is less, it is no doubt that it wants each one of its product to be
a hit.

This was the Marketing strategy of Apple. The Brand can teach a lot to marketers
with regards to differentiation, brand building and most importantly – Innovation.

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The marketing strategy of Apple: A concise
analysis
Posted on February 26, 2019 by Natalie Yeung

Immediately after college dropouts Steve Jobs and Steve Wozniak founded Apple in
April 1976, the duo initially sold some 200 circuit boards that they produced inside
an unused garage. They subsequently introduced the 8-bit fully functional home
computer Apple II in 1977 and it eventually became one of the first highly successful
commercially produced microcomputers in the market.

But the company did not rest alone with designing and manufacturing computers.
Apple expanded its product portfolio and successfully emerged as an innovative and
influential multinational technology company. The introduction of iPod in 2001 and
the online music and app store iTunes have revolutionised the music industry
through the promotion of digital music. These two products created and supported
an emerging ecosystem for selling and purchasing music via the Internet. The
company was also instrumental for ushering in the era of smartphones and tablet
computers with the introduction of iPhone in 2007 and iPad in 2010. These two
consumer electronic devices have reimagined the way manufacturers develop and
produce mobile devices.

Understanding the success of revered and culturally iconic products such as the iPod
and the iPhone nonetheless requires an appreciation of the overall marketing
strategy of Apple. After all, this prudently and intricately crafted strategy has played
a critical role in hurling its brand and products toward an unprecedented level of
popularity and approval.

ESTABLISHING THE COMPETITIVE ADVANTAGE OF

APPLE THROUGH PRODUCT STRATEGY
Jobs left Apple in 1985 and around this time, the Apple II and Macintosh series of
home computers were pitted against PC computers from IBM. The competition was
tough and Apple was at the losing end. The company struggled with maintaining sales
and it finally succumbed to defeat as Windows-based personal computers from
Microsoft gained a stronghold in the market.

The poor performance of Apple stemmed from its poor product strategy. Apparently,
the company was producing and selling an array of computer products that were
redundant and confusing. When Jobs returned in 1996 to lead the company, his first
order of business was to discard all unprofitable products and realign the product
strategy based on the concept of simplicity and premium user experience.

Today, product strategy is at the core of the marketing strategy of Apple.

Furthermore, it has become the competitive advantage of the company and its
flagship products to include the MacBook, iPod, iTunes, iPhone, and iPad. One of the
reasons why these products have become successful is that they are user friendly and
highly intuitive compared with their competitors. They are also unassuming because
of their simple and uniform built and design.

Of course, despite this simplicity, these products provide a premium user experience
through innovative features and design considerations. It is important to remember
that these products were not original. There were already ultrathin laptops long
before Apple introduced the MacBook Air. Portable media devices had existed prior
to the popularity of iPod. Moreover, there was already a market for smartphones and
personal digital assistants before the iPhone and iPad revolutionised mobile
computing and the consumer electronics industry. However, these products have
outcompeted their predecessors and some of their counterparts because they
provided an innovative and unique overall product usability and consumer
experience.
Apple employs a retroactive and proactive approach as part of its product strategy.
Essentially, the company develops its products based on the existing products of
competitors but it improves them by removing undesirable qualities and integrating
differentiating features. The results are products that appear new and innovative but
are still familiar or recognisable.

CREATING AND SUSTAINING BRAND LOYALTY

THROUGH COMPLIMENTARY PRODUCTS
The extensive but controlled product portfolio of Apple creates a uniform and unique
product usability and consumer experience. An iPod or an iPhone would be
incomplete if not paired with an iTunes or the App Store. The sleek metal-based
aesthetics of a MacBook also signals a sense of uniformity when used alongside the
iPhone. The user interface of these consumer electronic devices also employs the
same functional and design principles centred on simplicity thereby creating a strong
sense of familiarity.

It is also important to note that a particular user of different Apple devices can take
advantage of this homogeneity through the Apple ID. This all-access account allows
users to manage their digital identity, files, and device preferences across different
devices thereby allowing seamless transition.

Apple products create a halo effect. Because each product complements another
product, consumers would usually choose to stick with the Apple brand rather than
buying different products from different manufacturers and create a hodgepodge of
varying product and consumer experience. Considering the fact that the company has
a large pool of loyal consumers, they tend to buy all products under the Apple brand.
This halo effect coupled with deep brand loyalty complements the sales performance
of each Apple product.

The development and promotion of complimentary products and services are

undeniably part of the marketing strategy of Apple. With iconic and relevant
products coupled with industry tenure and established branding, the company now
enjoys legions of loyal consumers that comparable to fandoms of popular celebrity.

MAINTAINING BRAND IMAGE THROUGH PREMIUM

PRICING STRATEGY
The products of Apple are relatively expensive when compared with similar products
from competitors. An iPhone can be twice or thrice more expensive than the flagship
Android smartphones of other manufacturers. The same is also true for MacBook Pro
and MacBook air. One MacBook laptop can even buy three to five Windows-based
laptops from OEMs.

But premium pricing is also part of the marketing strategy of Apple. This high price
point or premium pricing strategy has helped the company promote and maintain a
favourable perception among its loyal buyers. After all, there are consumers who
believe that expensive products enjoy an exceptional reputation or represent
exceptional quality and distinction. Thereby, Apple products are positioned as
superior over their competitors through this pricing strategy.

It is also important to consider the fact that luxury has a psychological association
with premium pricing. Undeniably, Apple products are luxury goods because of their
high price points and consumers of luxury good are willing to pay extra in order to
maintain a sense of indulgence or a status symbol.

Of course, there are reasons to believe that Apple is not merely exploiting their
existing consumer base or its target luxury market. As mentioned, part of its product
strategy is to provide a premium user experience and one of the ways the company
does this is through its product design considerations. Take note of the iPhone as an
example. Unlike other Android smartphones with lower built quality due to its plastic
components, Apple has designed and built its product using premium materials to
include glass and aluminum.

THE UNIQUE MARKETING AND ADVERTISING

SITUATION OF THE IPHONE
Despite its record-breaking sales performance and a high level of popularity, there
are no extensive marketing strategy for the iPhone apart from product and pricing
strategies and publicities coursed through tradeshows and media relations.

It is worth noting that there is minimal advertising budget for the iPhone. Apple has
never advertised this product through print and broadcast media, although it
occasionally produces contents for online and social media distribution. For
traditional media, consumers are still exposed to advertising messages related to the
iPhone delivered through different traditional mediums simply because they are
created and paid by network carriers.

Whenever a new iteration to the iPhone series arrives, network carriers are eager to
announce to their existing consumer base and target market that they are already
offering the product under several service plans. Although it seems they are doing
Apple a favour, these carriers are actually marketing themselves using the iPhone as
bait, thereby luring customers or the target market toward their respective mobile
and data services.

However, these network carriers are not free from restrictions. Apple has
maintained stringent branding guidelines that essentially dictate the manner in
which carriers develop and implement their advertisements. The company does this
to maintain and protect its brand and promote uniformity in its established
marketing message. iPhone ads virtually look the same even though they came from
different advertisers.

This unique marketing and advertising situation of the iPhone demonstrates the
effectiveness of the overall marketing strategy of Apple that moreover, centres on
product and pricing strategies. The product is highly valuable because of its
popularity and if network carriers want to capitalise on its success, they need to
advertise that they have it.

History and background of the company:

The history and the back ground of Apple Inc which used to be Apple Computers, Inc when
they first started in California USA and become a multinational company which started from
scratch. Apple Inc mainly deal with consumer electronics, computer software and
commercial servers. Apple’s most famous products are iPhone, iPod and Macintosh
computers.

Apple was formed by Steven Paul Jobs 21 and Stephen Gary Wozniak 25, they created a first
Apple computer on 1st April 1976 named Apple I. Apple was incorporated in 1977 in
California (Apple website, FAQ). For about 20 year Apple computers Inc was predominantly
a manufacturer of personal computers that includes Power Mac, Apple I, Apple II, Apple III
and Macintosh lines but also faced unstable sales and low market shares. Steven Job resign
the company in 1985 due to infighting and he rejoin in 1996 as a CEO of the company. He
brought with him a new corporate philosophy of identifiable product and simple design.
Introducing a great success of iPod music player in 2001, Apple become a leader in
consumer electronic industry, dropping ”computer” from its name and keeping on to
release the iPad and iPhone. And in present Apple is one of the biggest technology company
in the world, with the revenue of over $60 billion per annum[ Hormby Thomas, A history of
Apple’s Lisa, 1979-1986, Low End Mac, 6th October 2005] [Apple website].

Strategy and Implementation

Philosophy of identifiable product and simple design help Apple maintain their growth in
early 80’s and a huge part of success is due to its leadership in the education sector, which
was one of the brilliant business strategy, education environment provided Apple with a
great amount of loyal users around the world. They started targeting into education sector
in Cupertino California by a very important agreement between Steve Job and Jim Baroux of
(LCSI) Logo Computer Systems Inc, which was an agreement to donate one Apple II and one
Apple LOGO software package to every public school in Texas. The idea was great and the
philosophy behind that was that if they donate one package to each school then this would
result in thirty more packages to sell, which is estimated as the number of students in one
classroom at least and ofcourse some more purchases are possible from parents who wants
to support the technology to make their children to stay aware of technology, learn more
and get familiar. This significant agreement between Apple Inc and Logo Computer System
Inc (LCSI) was a great success though out the State, which establish a very strong and
constant presence for Apple in the schools throughout California. This become Apple II’s era
in schools right across the United States and the leadership of Apple in education sector
around the world continues in the most critical time of 1980’s. Therefore Apple made it
extremely well in education sector as well as in the families, as parents carry on supporting
the learning experience for their children after school [Wikipedia, Article, Apple Inc].

Technology used and Product/Services:

Apple Inc mainly deal with consumer electronics, computer software and commercial
servers. Apple is an example of itself when comes to technology, the technology they
introduce since they first launched and until today. Although there was issues in some
software they introduced as well as their Operating system that it is not users friendly but
Apple keep identifying the issue efficiently and effectively, for example using Microsoft’s
Power point compare to Apple’s keynote which takes powerPoint apart and figures out how
the files work that makes it more user friendly [Bill Thompson, 19th Sep 2007, BBC News].
They are famous to introduce the best touch sensor in their products which includes Mac,
iPhone, iPod and iPad recently, best example is iPhone which is still the leader in smart
phone technology and introduced the best touch screen system in the market so far.

Apple have introduced various operating system for its products like Macintosh,
PowerBook, iPod, iPad and iPhone. Apple always use their own Operating system in all of
their products, one of the most famous operating system is iOS which is used in iPhone and
OS X, Mac OS X is the world’s most advanced operating system. Built on UNIX foundation
and designed simple as of this is one of the fundamentals of the company. This is why Mac
have a reputation of innovative, compatible, highly secure and user friendly [Apple website,
Mac OS X, Over view].

OS X series includes Snow Leopard which was unveiled on 8th of June 2009 and was
available to purchase in Cupertino, California and on their website and by 28th of August
2009 in the market throughout the world [Apple website, library, Mac OS Snow Leopard].
Mac OS X Versions are Mac OS X Server 1.0, Public Beta, then from 10.0 to the Latest
version is Mac OS X v10.6 Snow Leopard and 10.7 Lion announced on 20th of October 2010
and expected to release by 2011. Apple have also introduces digital cameras, portable CD
audio players, speakers, video consoles and TV appliances [Wikipedia, Apple Inc, Mac OS X].

The main markets where Apple operates:

Apple is a multinational company based in Cupertino, California and their product sales in
more than 50 countries, one of the most recent successful product of Apple is iPhone, it is
available in over 50 countries and more to be added in their network later and Apple
iPhones are making their production company to increase their yearly products because the
of their extreme success and they are selling it very well indeed and iPhones are increasing
their market share day by day and quit fast.

[Amit Bhawani, Information guide, Apple inc, smart phone launch, vodaphone]

As the graph shows, their main markets where they operates are USA, Japan, Germany,
France, Spain, Canada and UK, over all they are doing very well in Europe and USA itself,
besides that they are also in Mexico, Netherland, Sweden, Austria, Finland, Italy, Belgium,
Portugal, Switzerland, Denmark, Ireland, New Zealand, Hong Kong and now in India as well.
Success of iPhone is a great boom to Apple Inc.

Main Products and Ethical challenges:

Apple’s worldwide smartphone shares boost upto 17% due to iPhone sales reached 7 million
in 2009 including the continued version of iPhone 3GS and they are expected to be more
because later in the same year they started selling iPhones in China, where as Chinese made
a copy version of iPhone with different software but unable to beat the original one
ofcourse.

[Website Mac Rumors, News, Smartphone market worldwide]

Worldwide mobile phone market experienced less growth as compare to their early years
and in this year the growth was as low as 0.1 percent but smartphones was continuously
growing their success and performance and growing their market upto 12.8 percent nearly
every year.

They face great competitors like Microsoft which is focusing on delivering software to cheap
product personal computers while Apple delivers rich engineered products. Apple relied on
high profit margins and never developed a clear response. Other competitors are IBM and
Dell which are famous about their durability and have a good reputation in making
computers.

Product and Business Portfolio :

Product portfolio plays important role in company’s business success especially when come
to competition. Product portfolio is to capture and understand customers need according to
the market. Apples portfolio is to transform their customers into specifications of the
product they are offerings. There has been criticism on iPhone and iPod that these devices
has been locked/restricted into iTones and creating iTone Store monopoly but Apple keep
ensuring that anyone but their product will be completely locked/restricted to an Apple’s
created world. This portfolio keep the other competitors out in some aspects but is also
become hard to justify some measures when creating a circle around the customers and
keep competitors out. Although the fact that iTunes database format has already been
cracked and the third party tool have been updated, example application like cydia which
unlock iPhone and enable customers to download various applications and allow them to
use their iPhone for all the network providers. But Apple is spending more time trying to
ensure that anyone who purchase their product must completely locked in to Apple-centred
world in which they use iTones for products like iPod and iPhone, buy from iTones Music
store, and purchese only Apple-certified accessories. The new version of iTunes break the fix
and they keep updating the versions of iPhone and iPod to lock the customers and other
updated and therefore no third party tool is able to unlock the version unless it is certified
by Apple itself [Bill Thompson, 2007, BBC News, Article in Technology section].

Corporate Change and Social welfare of employee:

Apple was one of the highest successful companies founded in 70s, Corporate philosophy of
identifiable product and simple design which was introduced by Steve Jobs. Apple cares
about their employees and provide them various facilities and benefits that includes, staff
discount, paid holidays, maternity leaves, annual bonus and friendly and learning
environment.

Quality:
Apples relies on best quality for their customers as of their product is design to provide the
best output, high profile and highly priced due to their basic strategy of high profit margin
on each product and keeping their market stable. They launch the best quality product and
improvise it in later versions as required by their customers. They also manage to maintain
their product quality with their corporate philosophy of identifiable product and simple
design.