Consumer Electronic Sector

Consumer Electronics

Electronic equipment intended for everyday
use, most often in entertainment,
communications and office productivity.
APPLE Inc.
Apple Inc. is an American multinational
corporation which designs, develops, and
sells consumer electronics, computer software,
online services, and personal computers.
Apple was founded by Steve Jobs, Steve Wozniak,
and Ronald Wayne on April 1, 1976, to develop
and sell personal computers.
Steve Jobs strategy for Apple
had four pillars:
Offer a small number of products.

Focus on the high end.

Give priority to profits over market share.

Create a halo effect that makes people starve
for new Apple products.

Success Parameters
Revenue US$ 170.91 billion (2013)
Net Income US$ 37.037 billion (2013)
Total Assets US$ 207.0 billion (2013)
Employees 80,000 (2013)
Brand Image
Despite high competition, Apple has succeeded in
creating demand for its products, giving the
company power over prices through :
Product differentiation,
Innovative advertising,
Ensured brand loyalty, and
Hype around the launch of new products
Branding
Branding is a ''name, term, sign, symbol or
design, or a combination of all these that
identifies the goods and services of one
seller or group of sellers and to differentiate
them from those of competitors.'
How important is Branding to
your Marketing Strategy?
A good brand helps a company to achieve these
objectives:
Helps to deliver the message clearly.
It confirms your company's credibility.
It connects your target prospects emotionally.
It motivates the buyer.
It strengthens user loyalty.
Brand Recognition
It is when the consumers have good knowledge of
brand when they are asked questions related to a
specific brand and they are able to differentiate a
brand on the basis of having noticed or heard
about earlier.

E.g. Is I-phone related to Apple or Samsung?
It allows a customer to recover a brand from his
memory when given the product class/category,
needs satisfied by that category or buying scenario
as a signal, i.e. if they are able to recall the brand
from their memory.

E.g. Showing a logo of Apple's brand, and asking
which brand does this logo belongs to.
Brand Recall
Brand Equity
It is the premium value that the company realizes
from a product with a recognizable name as
compared to its generic equivalent firm.
Brand equity is said to be positive if the
consumers are willing to pay more for a branded
product than for a generic one.
Branding of Apple Inc.
Since Apple has strong brand awareness, it has
high sales and high market share, and the
consumers are well acquainted and familiar with
the brand and its products. They are also willing to
pay premium price for their products, relative to
the competitor's brand due to Apple's positive
brand equity.
STP( Segmentation, Targeting, Positioning )
Segmentation
When the market is divided into sub
groups, known as market segments, in
order to create product differentiation
strategies and to exploit these segments
to the firm's own use .Types of Segment
Demographic segmentation.
Geographic segmentation.
Psychographic segmentation.

Targeting
Different targeting methods can be used by the firm, like:
1. One supplier targeting a single segment with a single product.
2. One supplier with one product, targeting all segments.
Apple Inc. has been using the second approach of being
one supplier that is targeting many segments.

3. One supplier, with several brands and targeting different
segments for each brand.
Positioning
After segmenting a market and then targeting a
consumer, you would proceed to position a product
within that market.
Positioning is all about the 'perception', and it may differ
from one person to another. E.g. What you perceive as
quality, value for money, etc. maybe different to another
person's perception about it.
Apple is positioned as a premium brand in the mind of
the customers that demands and earns a price premium.
Premium prices
Jobs vision for Apple was always to create a premier
product and charge a premium price.
The hardware and user interface are
designed to provide a lot of value for the
price.
Apples cheapest products are usually
priced in the mid range, but they ensure a
high-quality user experience with their
features.
Differentiation
What Apple do is Differentiating itself to increase
their Market Demand.

Differentiating makes Apple products Unique and
Attractive to customers.

Designing Products ahead of the curve compared
to its peers.

Apple's competitive edge
Defined as strategic advantage i.e. when a business entity
has a benefit over its rival entities within its competitive
industry. It helps to strengthen and position a business
better within the business Environment.
Apple Marketing
Apple's hardware and Software
Apple's retail strategy
Apple is organized differently from all other competitors
Retail Strategy of Apple Inc.
MAP (Minimum advertised Price)
What is MAP?

Apple sells through their own Stores i.e.. Apple Own
Stores OR through Retailers like Wal-Mart , Best buy.

So, Retail strategy (i.e. for the Retailers ) is
providing marginal wholesale discount.

Thus it prevents retailers from competing directly
with Apples own stores.

Retail Strategy of Apple Inc.
MAP (Minimum advertised Price)
Apple prevents this scenario by offering monetary
incentives to retailers to sell goods at the MAPs fixed by
the company.

It also ensures that no one reseller has an advantage over
another.

So Apple is able to keep its distribution channels clean as
well as make more money on its direct sales.
4 Ps (marketing mix) of Apple
Inc.
Product are the goods and services that a
business provides for sale to target the
market.
At first Apple computers (MAC) were
considered as an overpriced niche product
with a low market share.
Later on Apple diversified its product mix by
introducing new line of products.
4 Ps (marketing mix) of Apple
Inc.
Price concerns with the amount of money that
customers should pay in order to purchase the
company's products.
Apple has never considered pricing as one of the
competitive advantages.
They only use their best resources to make a
great final product first, and then only worry
about the costs.
4 Ps (marketing mix) of Apple
Inc.
Place is related to the distribution, location and
methods of getting the product to the customers.
Apple has adopted a hybrid distribution channel
involving an online store, physical outlets and the retail
points of the exclusive mobile service provider and its
online store.
E-commerce website, like Amazon, Apple's website,
making their products as easy to buy for consumers
4 Ps (marketing mix) of Apple
Inc.
Promotion refers to the act of communicating the
benefits and value of your company's product to their
consumers.
Apple spends half billion dollars annually on paid media,
which is actually lesser than rival brands Microsoft and
Dell.
Everything in their advertisements are visual, and visually
plentiful, but not overpowering as some ads can be i.e.
SIMPLE
Powerful word-of-mouth marketing and brand loyalty.