Apple Inc.

Promotional Mix
Azim Mohamed (SCSJ 0008643), Vishnu A/L Vasnathan (SCSJ 0008843), Module: Promotional Practice

Contents
1 2 3 4 5 6 About the brand............................................................................................................................... 3 Audience.......................................................................................................................................... 4 Pricing.............................................................................................................................................. 5 Packaging......................................................................................................................................... 6 Brand Name ..................................................................................................................................... 7 Promotion Mix ................................................................................................................................. 8 6.1 6.2 6.3 6.4 7 8 9 Advertising ............................................................................................................................... 8 Sales Promotion ....................................................................................................................... 9 Personal Selling ........................................................................................................................ 9 Publicity ................................................................................................................................ 10

Conclusion ..................................................................................................................................... 11 Recommendation........................................................................................................................... 12 Reference ...................................................................................................................................... 13

Promotional Mix: Apple Inc

Page 2

1 About the brand

Apple Inc. (previously Apple Computer, Inc.) is an American multinational corporation that designs and markets consumer electronics such as MP3 Players (iPod), computer software such as iTunes, and personal computers such as iMac. The company's best-known hardware products include the Macintosh line of computers, the iPod, the iPhone and the iPad. As of August 2010, the company operates 301 retail stores in ten countries, and an online store where hardware and software products are sold. As of May 2010, Apple is one of the largest companies in the world and the most valuable technology company in the world, having surpassed Microsoft. Established on April 1, 1976 in Cupertino, California, and incorporated January 3, 1977, the company was previously named Apple Computer, Inc., for its first 30 years, but removed 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. As of September 2010, Apple worldwide annual sales of $65.23 billion.

Promotional Mix: Apple Inc

Page 3

2 Audience

Product

Promotional Mix

Audience

When shoppers sleep outside of stores just to be one of the first to buy an iPhone, it s obvious that Apple Inc. is a company that enjoys fanatical brand loyalty was quoted by a researcher studying the loyalty for Apple brands. That is, Apple is aimed at young adults particularly those between the age of 12-25, It will appeal to both males and females, Targeted at the niche market creating product desirability, Middle/high class, people who have a passion or interest in music and/or literature. Thus, this is large enough to engender revenues and profits. Apple has adopted the differentiated market for their products as its products are characterised in age, gender and desire for image. Apple ipod is used by young adults and teenagers and for both male and female.

Promotional Mix: Apple Inc

Page 4

3 Pricing
Apple always discount the price of existing products and offer the new product at a reasonable price as the same as the ones now. Apple products use cost base method to derive its prices. They will add a 65% profit margin to the cost of the product to gain efficient revenue. Price and quality interactions:y y y In this way, price creates perception of quality. High price attract an image of quality This will allow Apple Ipod to increase its market share

Apple focuses on two main pricing strategies which would be Psychological pricing and premium pricing. In psychological pricing the seller here will consider the psychology of price and the positioning of price within the market place. The seller will therefore charge 99p instead 1 or $199 instead of $200. The reason why this methods work, is because buyers will still say they purchased their product under 200 pounds or dollars, even thought it was a pound or dollar away. Apple will set pricing on RM 2599.00 US$ 699.00 etc. Premium pricing is when the price set is high to reflect the exclusiveness of the product. An example of products using this strategy would be Harrods, first class airline services, Porsche etc. Apple sets their prices higher than competitors such as Sony or Samsung.

Promotional Mix: Apple Inc

Page 5

4 Packaging
Apple has a packaging concept which outstands every other competitor in the market. Moreoever, any other manufacturer. Detail attention to packaging and presentation of the product is given only on Apple products. Apple Inc. has specialized designers employed solely for the task of designing a creative and attractive packaging for the customers of Apple. Bryan, J. 2005 quoted on MacRumors forum that I have just bought my parents a mac mini and my cousin was far more interested and wowed by the disign of the box that the computer came in than the computer. It made me think of my ex who was also a huge fan of the packaging of Apple computers, but hated the computers themselves. Continuing forumers complimented the package by saying Apple does have some of the best packaging. There's always an inside joke here when people buy new macs to smell and admire the packaging. Apple wraps it up like a present.

Promotional Mix: Apple Inc

Page 6

5 Brand Name
Apple is now the hottest property in terms of consumer goodwill, earning an estimated valuation of $153.3 billion and leading a pack that includes the likes of Coca-Cola, BMW, HSBC, and Disney. The tech sector had a very strong year as a whole, with Facebook s brand improving in value by a staggering 246 percent (to $19.1b) and Amazon becoming the world s most valuable retailer (at $37.6b) in spite of having no actual stores. Sadly, there were some downers too, as Nintendo lost 37 percent of its brand worth over the past year, Nokia dropped by 28 percent, and the BlackBerry marque was considered 20 percent less awesome than before. This gives extra focus and attention from customers to Apple, making it a high end and premium brand.

Promotional Mix: Apple Inc

Page 7

6 Promotion Mix
Apple s 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 2008, 2009, and 2010. Apple ensures that it retains the strategy and strength yet make it more effective and vibrant. By promoting the Apple products this will satisfy the needs of the customer s and business. Consumers will gain better understanding of the product and how it can satisfy their needs, but on the other hand will help Apple Ipod increase their profits and market shares. Their promotional strategy adds value to their product by altering consumer perceptions

Sales Promotion

Publicity

Apple Inc

Advertising

Personal Selling

6.1 Advertising
Apple product will spotlight on successful advertising campaign comprising of magazine and television advertisements focusing on the targeted demography. Apple s advertisement are a catch of the eye like its products. Its simple, frenzy, chic and mostly are located in IT professional or geeks magazine. However, in the bigger markets like Chine, billboards and TV ads are used to reach out to the total audience of China.

Promotional Mix: Apple Inc

Page 8

Nonetheless, their main medium of advertisement is Internet and Magazines, to which approximately 60% of the Apple s marketing budget is spent on.

6.2 Sales Promotion

As referred by MarketingTeacher.com, Apple, Inc offers special discounts on refurbished MacIntosh computers, iPod Nanos, and the 8GB iPod Touch. In each case a 1 year warranty is included on the all products. The online Apple Store offers free shipping for orders over $50. These are some of the apple sales promotions. Moreover, Apple provides a $100 rebate when you purchase a Mac from the online store which makes customers look differently on the premium pricing. Such sales promotion enables discounts unlike standard pricing used in Apple authorized dealers around the world. According to Yukiko on his blog change some way of promotion and advertisement since I think they want to advertise on iTunes or iPod which have many customers.

6.3 Personal Selling

Apple customizes their relationship with the customer by means of technological experts and making the product special and customized. As referred by MarketingTeacher.com, Apple, Inc authorized Training Centers are located throughout the U.S and other countries. Each provides instruction in Mac systems, Mac OS X, and Apple s professional applications. This makes customers who walk into the shop very much comfortable around the sales person and are of big assistance to the customers. A wide range of certification exams and courses offer innovative learning opportunities for IT and creative professionals, educators, and service technicians delivered exclusively by Apple Certified Trainers. The Apple Consultants Network website provides a search tool allowing visitors to locate nearby certified Mac product consultants in the U.S, Canada, and a number of international locations. So the customer s find their best friend during the purchase of Apple s product. Meanwhile, the online Apple store offers iTunes gift cards. This card is used like a voucher to further purchase your necessary applications and movies from iTunes or AppStore. Meanwhile, they also offer packaged back-to-school offers, including some aimed at college students. In fact they customize their products with student rates and are located in some campuses such as Limkokwing University of Creative Technology, Malaysia and University of Westminster, UK.

Promotional Mix: Apple Inc

Page 9

6.4 Publicity
People are interested in what Apple is doing very much. A proof of this is the Business Week blog Byte of the Apple which is all about Apple. That blog is ringing with the Apple s invitation for the new product release on February 28th. Apple sent the invitations to reporters that did not mention what the product may be, but said just "Come see some fun new products from Apple. Then, some websites guess what their new product is, which is like great promotion for Apple. Even though many companies spent a huge amount of money on promotion or an ad, Apple did not pay for that promotion and they just sent an invitation. It is important for promotion to get attention, and Apple has already gotten that even before showing the actual product. In addition, in the blog, an author Arik Hasseldahl says Stay tuned and many people commented on the blog which means that Apple could get continuous attention. Their annual grand announcements by Steve Job and conferences have had the eye of the whole world stop at these announcements awaiting the world s finest new innovation. In an article regarding a marketing mix perspective it argues that Typically Apple announces new products very close to the time when the product is available for sale. Not this time-the iPhone hype has been buzzing for about 6 months when the iPhone announcement was made at Mac World. The halo effect from its popular iPods will have a positive effect on some consumers' perceptions of the iPhone

Promotional Mix: Apple Inc

Page 10

7 Conclusion

Promotional Mix: Apple Inc

Page 11

8 Recommendation

The recommendation part for the apple inc is they should not change their role of imc process but they should add some new elements of marketing process. Which is apple inc add strategies on their pricing part, which is they should establish skimming pricing strategies. This is because skimming pricing will target a customer segment which willing to pay higher price just because not to stay of left behind from the technologies. Beside that , skimming is an effective strategy when enough customers are willing to buy the product at the high initial price to make these sale profitable. This happen because customers can see the product quality and also image support higher price.

Other than apple inc should wide their target market which concentrate on geographic segmention . This is because apple inc is an strong public relation company they are many not target customer are in demand some other countries who seek for apple product. For example the new iphone which stimulate the whole country economics by thousands of people in market rushing for iphone. To ensure this to practices in apple inc, they should increase they specialty stores in national wide and also must maintain , ensure their retailers services is quality is followed. The reason is it will effect apple brand image.

Promotional Mix: Apple Inc

Page 12

9 Reference

[online]

The

Apple

iPhone

Marketing

Mix

Perspective

http://www.ama-

rochester.org/blogorama/2007/07/the-apple-iphon.html [Assessed 30 June 2011] y Apple Inc (2011) App Marketing and Identity for Guideline [Assessed [online] 15 July

http://developer.apple.com/appstore/AppStoreMarketingGuidelines.pdf 2011] y Business Weed 2011. Byte of the

Apple

[online]

http://www.businessweek.com/technology/byteoftheapple/blog/ [Accessed 12 July 2011] y Mac Rumors (2011)[online] http://forums.macrumors.com/showthread.php?t=141143

[Assessed 18 July 2011] y Marketing Teacher (2011) Apple Case Study study/apple-case-study.html [Assessed 17 July 2011] y Stat peep (2011) Brand Value Statistics [online] http://statspotting.com/2011/05/brand-valuestatistics-apple-brand-valued-at-153-3-billion/ [Assessed 20 July 2011] y Yukiko K (2011). Apple set to release new products [online] http://www.marketingteacher.com/case-

http://ykogure.blogspot.com/2006/02/apple-set-to-release-new-products.html [Assessed 17 July 2011]

Promotional Mix: Apple Inc

Page 13