Apples Marketing Strategy: History Repeats Itself

Jun 14, 2011 by Tien Anh Nguyen advertising, featured, marketing strategies, product strategy inShare8 How Apples wildy successful marketing of their new products really is a continuation of their classic Macintosh marketing strategy. The last few weeks witnessed yet another massively hyped, incredibly successful launch of iCloud during Apples annual conference WWDC. The whole Web world is now already awash with rumors and news about the upcoming new versions of the wildly successful MacBook Air, yet another product of Apple that has really revolutionized its market segment (of ultraportable laptop). Apple is seemingly invincible in developing and marketing worlddominating mobile computing devices of all sizes and usage. Much has been said about the marketing tactics they used in introducing the iPad, the MacBook Air, and the iPhone. The common thread we hear is that it is a masterful combination of hype, sagacious timing, exclusive sneak previews, and extremely effective presentations that give these products such successful launch (of course, the products actually are a joy to use, but this post is mostly about the marketing strategy). However, if you look back in time very much further, in the early 80s, and re-examine how Apple tackled product launches of similar scale, you can find that Apple has always been a winner in massive scale, high profile ground breaking marketing campaigns, and that their core philosophy behind these marketing campaigns remain very much the same, even as the technologies inside of these products have taken quantum leaps, and the high tech market today is far more evolved and competitive than 30 years ago. We find that Apple still adheres very much to a number of principles that one of its original marketing gurus Regis McKeena has expounded: - High-tech marketing has to be all encompassing: That is, high-tech products are not easily marketed or communicated over simple media channels, nor to a single set of customers. A company has to market/communicate to everyone in its marketplace, and has to be active in creating and defining the discourse around that product. Apple was not the first company to sell a MP3 player, but its effective marketing and promotion of the product, its introduction of the Itunes music software help bring MP3 players to the mainstream, together with the Ipod. - Markets are made, not won: Markets for new innovative products do not exist, they have to be created, and defined. Therefore, the company has to be creating the product and defining its market at the same time, in the same process. Apple has never been afraid of redefining its market, breaking through well-worn product convention, because it believes in creating and owning whole new markets, rather than competing in existing, crowded arenas.

- Influencers are key: Then as now, consumes are weary of advertising, and trustworthy, neutral parties are very important to helping communicate the value proposition of the product. As secretive as Apple is, it still has a powerful grip on the high tech media because of its long tradition of nurturing relationships with them, and it has fanatically devoted users who are powerful influencers in their own right. - Marketing message has to be user-centric and inspirational: Apple is a company that truly speaks to its consumer directly, and inspires the best of emotions in them, for example, awakening the Child-like sense of wonder in all of us. No other company does emotion marketing as well as Apple. Again, this is something that is core to their marketing playbook just compare the following taglines for the Macintosh, which was introduced in 1984, and the iPad, which was introduced in 2010, 26 years after (pointed out by Joe Wilcox at betanews.com): Macintosh: Despite all the amazing technology and engineering genius weve put into Macintosh, the most impressive thing just might be what you can get out of it: Magic. iPad: A magical and revolutionary product at an unbelievable price. It is amazing how their marketing formulas have remained very consistent throughout all these years.

iPhone Marketing Strategy. The Apple iPhone is an outstanding product. The iPhone is at least 5 years ahead of the competitors. The touch user interface and the sleek and beautiful design by Jonathan Ive and his team make it a true masterpiece of technology and design. the iPhone is not only a mobile phone, it is a product in between a mobile phone and a laptop computer. Even calling it a smartphone is not enough. After many rumours and speculations which started as early as in 2006, the first generation iPhone was launched in the US on June 29, 2007. The second generation iPhone, the iPhone 3G, was launched in July 2008. The third generation iPhone, the iPhone 3GS, has been launched in June 2009.

The iPhone has entered a market - the market of mobile phones - a market which is mature, and saturated. Nonetheless, Apple has been able to develop a revolutionary product, and to change the paradigm in the mobile phone market. Apple did great on the product side, no doubt. However Apple has done some serious mistakes in the marketing of the iPhone.

Mistake #1 - The iPhone Pricing at market launch. Apple made a big marketing mistake in 2007, by reducing the iPhone retail price from $599 to $399 - a 33% rebate - after only 3 months from the initial product launch. This way the iPhone early adopters - and Apple most faithful costumers have rightfully felt being betrayed and exploited.

A great company must not do so serious and bad mistakes, betraying their most faithful customer base. They had other 3 better options: They could have waited 6 more months before reducing the price of the iPhone, or they could have delayed the iPhone launch for 3 months, or they could have decided to price the iPhone at $399 since the initial launch. and since July 2008, the iPhone 3G is sold at $199, 50% less than the September 2007 price, 66% less than the launch price of just one year earlier.

Mistake #2 - Forcing costumers in signing with AT&T as exclusive carrier and the revenue sharing business model. It has been a greedy and wrong marketing strategy on the side of Apple. Result: slowing down the sales of the iPhone. 3.3 million iPhones were sold in the US between June andl December 2007, but only 2 million contracts were signed with AT&T. Were did the remaining 1.3 million iPhones go? Mistake #3 - the Apple iPhone and the Europe markets The US makes 300 million inhabitants. Western Europe makes 350 million inhabitants, more than the whole US. On June 29, 2007 the iPhone was launched in the US. Only in November 2007 the iPhone was launched in some European countries. To be precise only in 3 countries: UK, Germany and France. In each of these country with the same stupid and self hammering business model used in the US, and in each country with a different carrier: O2 in the UK, T-Mobile in Germany, Orange in France. Only on July 11, 2008, one full year later, the iPhone has been launched in several other European countries, as Italy, Spain, Switzerland, Austria, Ireland, Denmark, Norway, Sweden, Finland, Netherlands, Belgium. Why so late?

It gets interesting to see the jam and confusion of prices, terms and monthly fees charged by the many different carriers in Europe: O2 in the UK, T-Mobile in Germany, Austria and Netherlands, Orange in France, Swisscom in Switzerland, Vodafone in Italy, Telia Sonera in Denmark, Norway, Sweden, Finland. The iPhone 3G Price in Europe On July 11, 2008 the iPhone has been launched also in other key countries worldwide: Australia, New Zealand, Canada, Japan, Mexico, Brasil. In conclusion: a great lesson from Apple on how to undermine a great product adopting a stupid, greedy and self hammering marketing strategy.

The iPhone 3GS.

In June 2009 Apple launched the iPhone 3GS. The iPhone 3GS has a 3 megapixel autofocus camera, video recording and editing capabilities, voice control, longer battery life, 7.2 Mbps HSDPA internet connection. iPhone 3GS is twice faster than the iPhone 3G. The iPhone 3GS prices: $199 for the 16GB model, $299 for the 32GB model. more on the new iPhone 3GS on the iPhone 3GS page.

iPhone Sales Data. Apple is always reluctant to give detailed data about sales of their products. A total of 33.75 million iPhones had been sold worldwide until the $th quarter of 2009. Of these, 11.3 million 3G iPhones have been sold between July 11 and December 27, 2008. Previously a total of 6.1 million first generation iPhones had been sold in US, UK, Germany and France. From these data it comes that, in spite of the serious marketing mistakes done by Apple, the iPhone has been a huge success.

Apple Marketing Strategy Apple has been so successful in these last years thanks to his fresh, imaginative way to think and do its business: a winning combination of exceptional products, great style and design, great strategy, innovative marketing, sleek and enticing communications. Apple owes its overwhelming success in the last years to the iPhone and to the smart iPod and iTunes product combination, a combination of a great hardware piece with great style, great software, great performance, user friendly interface, with a good e-business service. The iPod + iTunes halo effect and new great Mac computers and Mac OS software did the rest in increasing Apple revenue stream. In the 5 years between 2003 to 2008 the Apple share value increased 25 times, from $7.5 to $180 per share. At july 2008 prices, before the US Financial Crisis, Apple stock market capitalization was $160 billion. In January 2010 Apple shares topped the $210 mark. But even the best companies with the best products have bottleneck factors which often avoid full exploitation of the opportunities.

The iPod. Few people are aware - and few market analysts too - that for the first 3 years the iPod was an absolute flop. The iPod was launched in october 2001, and between 2001 and 2004 iPod sales were between 100-200 thousand units per quarter, very far from today's 10-20 million units per quarter, and the iPod sales were not even covering the product research & development costs.

Then, in June-Aug 2004 something happened, and iPod sales began to grow strongly, quarter after quarter. Today, we all know where the iPod stands, and what a remarkable success it is. The iPod made the fortune of Apple, and it stands out as the major turning point in the company growth. Few people know that the iPod + iTunes business idea was not conceived inside Apple, but was proposed to Apple by an outside source, a music lover and Engineer named Tony Fadell. More on Tony Fadell and on the iPod marketing on iPod Marketing Strategy The iPod marks another outstanding result in marketing: the annihilation of competitors. To know more see the analysis on The iPod competitors It should be noted that, since the second generation of iPods in 2002, the iPods were made compatible not only with the Mac operating systems but with Microsoft Windows operating systems as well. We should ask ourselves (and to Steve Jobs): how many iPods would have been sold if the iPods would had been compatible only with Mac operating systems? Where the iPod is manufactured and assembled

The iPhone. The pipeline of new products which came out from Apple in the last years is impressive, and overwhelming. In 2007, with the successful launch of the iPhone, Apple has marked another milestone in its development and growth. And moreover, the iPhone enters a market - the market of mobile phones - a market which is mature, and saturated. Nonetheless, Apple has been able to develop a revolutionary product, and to change the paradigm in the mobile phone market. The iPhone is 5 years ahead of all its competitors. A wonderful product, amazing user interface, great design. It is not only a mobile phone, it is a product between a mobile phone and a laptop computer. Even calling it a smartphone is not enough. In July 2008 Apple launched the second generation iPhone, the iPhone 3G.

The iPhone 3GS. In June 2009 Apple launched its third generation iPhone: the iPhone 3GS. The iPhone 3GS has a 3 megapixel autofocus camera, video recording and editing capabilities, voice control, longer battery life, 7.2 Mbps HSDPA internet connection. iPhone 3GS is twice faster than the iPhone 3G. The iPhone 3GS prices: $199 for the 16GB model, $299 for the 32GB model. more on the new iPhone 3GS on the iPhone 3GS page. More on iPhone Marketing on the iPhone Marketing Strategy page.

Apple did great. no doubt. However Apple has done some serious mistakes. The most serious mistakes Apple has done concern marketing and distribution strategies 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. Apple Marketing in Europe We met with with Erik Stannow, Apple Vice President of Marketing for Europe & EMEA. We have been talking with Erik Stannow about the marketing and distribution issues of Apple in the European markets and we gave some valuable suggestions to improve the Apple marketing strategy and distribution in Europe. Well, it seems that in Cupertino they don't care so much about Europe.

Steve Jobs If we talk about Apple success, about Apple great products, we need to talk about Steve Jobs. Steve Jobs has been and is the great mind behind all this. Steve Jobs is a genius, he is a magician, too. He is the most skilled guy in introducing new products - "... one more thing" - the most skilled in presenting the key features, and he is a great communicator. Even more important, Steve Jobs has Vision. Vision in the strategy, Vision in the product development, Vision in the alliances.

Apple Communication Strategy. Apple communication is sober, intriguing, simple, clear, minimalist and clever. And it has a style of its own. Both in the tv ads, both in print ads, both in the online communications. A lesson to be learned by many companies in the world. Well, of course when you have great products it is much easier to entice the costumers, but nevertheless doing it with style and cleverness is a very good point. It boosts sales, but enhances the brand value too. The famous "I am a Mac, I am a PC" tv ads are a milestone in communications. Smart, simple, effective and humiliating (for Microsoft ...).

Marketing Strategy How Apple reinforces that Simpler is Better?

By Sagar Gholap 2

Apple has been able to accumulate massive success and riches over the years. Many people associate this success to their relentless hard work and their ability to foresee and act on the changing marketing trends. However, if there is one single factor Apple can crown as the reason of its success then it is the simplicity. Apple and simplicity? Now that may seem like a

far fetched notion but it is true. Apple, just like some other big names out there, has been able to strike a chord with its customers but over the course of years, it has also been able to significantly increase its market share in the mobile industry which is becoming an increasing competitive market. Given the current popularity and status of iPhone, it is over whelming to imagine that the phone only came out in 2007. Its been successful, all right. But how did Apple do it? Heres apple marketing strategy!

Presentations If there is one area where Apple beats all other industrial giants such as Microsoft, Nokia or even Samsung hands down, it is the presentations. Each time Apples goes into producing any new product, the whole world stops and zooms in to analyze and counter-analyze the specs of the upcoming products. Despite having plenty to share, Apple chooses the simplest route and that is of addressing the general public. As far as I am concerned, Steve Jobs alone can give all tycoons a run for their money. The man, other than being a genius, speaks a language a common person right off the street can understand and that is the beauty of just about any given Apple Presentation, which is meant as much for the general public as it is meant for the media. Brand Loyalty Apple Inc. was founded only a year after Microsoft, at the moment it is on the pinnacle of its popularity and success. Unlike most of its rivals, Apple especially is not known to care for the budget of a commoner. In fact, it wont be wrong to say that Apple, ever since its foundation, has only targeted a certain brand conscious class. For that very reason, none of the products of Apple are meant to fall within the budget of a normal man but more and more

people are covetous of Apple products than ever before, since it is established to represent a certain class. Apple fever proved to be an epidemic and now it has spread far and wide. Take the example of Nokia on the other hand. It manufactures all kinds of phones, not just the ones meant to drill some major holes in your pockets (and purses). Despite being economical as well as reliable, Nokia has lost significant market share to Apple, the brand that refuses to lower its prices. More and more people are changing their loyalties in favor of a brand that comes with a promise of delivering or more importantly, enrolling them in the class. Effective Advertisement Apple has successful employed the same strategy here as well. In its advertisement campaign, rather than challenging peoples intellect and throwing all kinds of computing or mobile jargons at them, Apple sticks to the basic. The latest ad campaign for iPhone 4, rather than concentrating on its oh-so-powerful processors simply magnifies some of its very basic functions such as improved picture quality and email experience. From presentations to advertisements, Apples marketing strategy has been in a language people can understand and that is definitely one of the biggest reasons why they are so successful in every thing they do.

7 Key Strategies That You Must Learn From Apples Marketing

Coming off the heels of yet another successful Apple launch debut, its increasingly clear that Apple is on top of their game in a way like no other. Which other company could turn an ordinary press conference into a live global event? The secret lies beyond their product line and design standards; it lies beyond even Steve Jobs emphatic adherence to Apples core philosophy, which is that the user doesnt always know what they want.

Looking at the companys latest product lines and revenue models, Id be a fool to call them anything less than what they are, which is:
y y y y y y

A design firm A media platform A publishing company A software powerhouse A computer builder A movement

Break down each of these bullets individually and youll find a company at the top of their respective industry, but combine them into a single entity and youve got the recipe for building one of the most influential businesses of all time.

So how did they do it?

Rather than tell you how I think they did it, I thought instead Id turn to their fans on Twitter, who helped me uncover 7 of the greatest marketing lessons that Apple brings to the table.

1. Ignore Your Critics

As an entrepreneur, youll hear a lot of people tell you that you need to reach out and figure out what people want, which means listening to your critics, often times more patiently than youd like. Apple decides to flip the script and instead focus on building what they want to build, no matter the perceived cost. When Steve Jobs debuted the iPad, the critics stood in line, throwing every insult they could muster. The critics said that the iPad would fail. The numbers say otherwise. Each and every time Apple decided to innovate, they were laughed at. They prevailed anyway. Great ideas often receive violent opposition from mediocre minds. - Albert Einstein

2. Turn the Ordinary into Something Beautiful

For quite some time, PC fans enjoyed the work of buying their own parts and building their own tower systems. At the same time, PC makers were building standard hardware for standard applications. Apple would have none of that. Theyve been pioneering not only the features of standard operating systems and computer systems, but simultaneously reinventing the design standards as well. As a result, we have the gorgeous iMac, the beautiful new Macbook Air, and who could forget, the amazing iPhone 4. Where others focus on one aspect of the equation, Apple focuses on the entire product, and it shows.

3. Justify Your Price

Were in a time when pricing strategies are all over the place. People dont know what to charge, and in many cases, prefer to race to the bottom instead of pricing strategically to a market that can bear the cost. Once more, Apple ignores the standard by not only pricing their technology more than 2x what their competitors charge, but doing so without blinking. How can they get away with it? Well, the answer is twofold: 1. They build beautiful products for an audience that loves them passionately. 2. They justify their price with features and benefits that cant be matched. Since weve already hit point 1, lets work on #2. No other computer can match the display of a 27 iMacit simply cant be done. No other software can match what iTunes brings to the table.

No laptop is as thin as the Macbook Air. No software is more intuitive, no product more valuable than the Apple product. Any other smartphone looks like it was developed by rookies when compared to an iPhone 4. You simply cannot compare the two. Critics will play on the fact that the core features are the same, and they might be, but thats not the point. The point is that Apple is the Rolls Royce of the technology and design world, and their customers will gladly pay a premium because of it.

4. Communicate in the Language of Your Audience

It makes no sense to talk about things like megabytes, gigahertz, and processing power to customers that simply dont care about technical jargon. Take a look at any Apple product page and youll find that though they do discuss product specifications and technical information, its hidden behind the benefits that their audience is truly after. Instead of display resolution, youll see phrases like edge to edge glass, retina display, and LED backlighting. Sure, the jargon is there for those that need it, but its presented in a way that makes you want to learn about megapixels, rather than shy away from them. The art is in the copy, not in the features.

5. Extend the Experience

Have you ever heard of an unboxing? I hadnt either until recently, when I learned that not only was I not the only one keeping Apple packaging post-sale, but that there are legions of people that record the actual process of unwrapping their newly purchased Apple products. Do a search on YouTube and youll find hundreds of Apple unboxings, each from different users from across the globe. Its pretty crazy right? No one tells these people to video their experience, but they do it because the process is so Zen that you cant help not to. Apple does this by making sure that the experience doesnt end at the cash register. They take great care in designing a user experience from browsing to unwrapping, which relies on incredible packaging and installation procedures. By reducing installation to the lowest common denominator, they make buying new products a snap, and by spending as much time on designing packaging as they do on the products themselves, theyve ensured that the box matches whats inside. As a result, theyve built an experience that is nearly impossible to match.

6. Build a Tribe

Its no secret that Apple has built one of the most hardcore fan bases of any product and of any time. Theres a reason theyre called fanboys. But who cares, right? Most of the chatter is out of jealousy more than anything, but Apple doesnt really care. They know that they serve an elite audience, and rather than back away from that fact, they embrace it.

7. Become The Name

You dont buy tissues, you buy Kleenex. You dont buy MP3 players, you buy an iPod. You dont buy a smartphone, you buy an iPhone. Have you noticed what theyre doing here? Apple isnt content with being a leader in sales alone, they want to own the market itself, which explains why theyve engineered iTunes as the major music provider that it is, and why the iPad, having the luxury of being the first, has now set the trend for future tablet devices. From here on out, everything will be compared to the iPad, iPhone, iPod, and iTunes. Sadly, this sort of thing is tough to duplicate, but its not impossible. You need to have one of two things: 1. A clear head start in terms of being first to market. 2. A USP that differentiates your product in a way that makes people wish it were first. The iPhone wasnt the first phone, but they engineered it to be so unique that you couldnt help but think it was. The iMac isnt the first all in one, but it became the only one that mattered.

iPhone Marketing Strategy

By Jesus Smith

As with all Apple marketing, the iPhone marketing strategy is very clear, simple and clever. With the plain and simple apple icon, Apple focuses on the pure innovative style of their products without all the "fluff". The iPhone was released by Apple in June, 2007. The ground-breaking style of the iPhone was touted for months before the initial release and has remained the best of the best when it comes to cell phones over the past several years. Before the iPhone's official release, Apple ran four television commercials promoting the new cell phone. The first of the commercials portrays the new iPhone as the next step up from the popular iPod. The iPod was all the rage up until this point, and the iPhone was supposed to be the next-generation iPod, oh, and it's also a phone! The advertisement displays all of the enhanced features available in the iPod, and more, the point being "There's never been an iPod that can do this." "So, say you're watching Pirates of the Caribbean" Finger clicks on video and displays wide screen movie. "Mmm, did somebody say Calamari?" Finger clicks back to menu, selects Maps application to search 'Seafood'. "The closest would be..." Map displays all seafood locations and highlights location nearest to you. "Ah!" Finger clicks seafood location, and restaurant phone number displayed. iPhone dial's. The first four iPhone commercials flaunted the convenience, innovation, and usefulness of a single product with the functionality of not only a phone, or a music device, but a product that can, among other things, listen to music, watch videos, view photos, make conference calls, check e-mail, browse the web, and view maps. Not only does Apple utilize television for their marketing strategy, but they make use of their website by posting videos, they also published a handful of press releases that could have been released in one single document. Apple often uses this tactic to build up hype and leave the consumer wanting more.

With Apple's brief press releases, giving the audience little to go off, "Apple leveraged a law of social physics - news, like nature, abhors a vacuum. In the absence of real information, those who care about a product will grasp at any rumor that comes their way. Apple may publicly disavow the rumor Web sites that scramble for scraps about the companies plans, but secretly their marketing department must be delighted. It would cost a lot to buy that kind of Web advertising." (Silverman, 2007) The official iPhone website does more than just provide information about the product. The website provides top tips and tricks for the use of an iPhone, as well as a huge focus on apps. Almost the entire iPhone page displays images of apps, provides the "App of the Week," the website also contains sections titled "Apps for Everything," and the "Top Apps." Apple's website is a great marketing tool for current iPhone users and consumers that have an interest in purchasing the iPhone. The promotion of the apps will create a stronger source of revenue for Apple. As customers see top rated applications, they are more likely to download the app, rather than searching through 25,000+ apps to find one that may be of any value to the consumer. Successful younger men were the target audience that Apple had originally focused on. Apple had hoped that with this target audience, and the fact that 48% of this audience did not already own an Apple iPod, would allow them to reach their forecast of 10 million sales by the end of 2008. One month prior to the release of the iPhone, Solutions Research Group profiled a crosssection of those aware of the phone. The forecast of potential buyers for the day of the release ranked a majority of T-Mobile customers, AT&T's only GSM-based product competitor, at 15%. The second largest group expected to purchase the new iPhone was AT&T's existing customer base, at 12%. The Solutions Research Group also found that 72% of males, versus 28% of women were most likely to investigate the phone at its minimum price of $499. (Malley, 2007) The obvious current target audiences for the Apple iPhone include young people between the ages of 20 and 35, affluent teenagers, "jet-setters", and "mobile" employees who work outside of the office. Apple is known for their simplistic, but catchy commercials. In recent television commercials for the Apple iPhone, "There's an App for that" is the new catch phrase that places a strong focus on the apps available from the App Store. Apps, or applications, are in "every category, from games to business, education to entertainment, finance to health and fitness, productivity to social networking. These applications have been designed to take advantage of iPhone features such as Multi-Touch, the accelerometer, wireless, and GPS" (Apple, 2009). Apple currently claims to have 25,000+ apps available, and counting. The focus on the variation of apps offered opens up the target audience greatly. There is essentially an app for everyone. As a few of the iPhone commercials advertise, you can find the snow conditions on the mountain, track calories in your lunch, find exactly where you parked your car. You can find a cab in a strange city, find your share of the bill for a table of 5, or learn to fix a wobbly bookshelf. You can read a restaurant review, read an MRI, or just read a regular old book. These are just a few of the features that Apple has promoted through television commercials. iPhone apps provide every functionality that one can imagine.

When the iPhone was initially released, it was priced at a hefty $599. Still, hundreds of thousands of people rushed out to get the new phone, forking over a third as much as they would have had they waited an extra 3 months. 3 months after the initial release, Apple reduced the price of the iPhone to $399. This enraged Apple's loyal customers and consumers who purchased the new phone just months earlier. One year later, Apple again reduced the price of the iPhone to $199, 66% less than the original price. In July, 2007, the Apple iPhone was all the hype. I believe that Apple's decision to release the phone at $599 was slightly based on greed. However, their product was the most innovative out in the market place, giving Apple the freedom to price the iPhone at whatever they wanted. Many believed that Apple had cut the price after discovering lower than expected iPhone sales. Apple, however, states that the price cut was made "to spur holiday sales and predicted that Apple would meet its stated goal of selling its 1 millionth iPhone by the end of September." (Dalrymple, 2007) As with the product life cycle of any cell phone or Apple product, including Apple's iPod, prices are often reduced drastically months after the initially release. Tech products are always competing against "the latest and greatest" while maintaining a relevant price in the market place. Had Apple not reduced the price of the iPhone, the customer base would have dwindled quickly as many consumers are unwilling to spend $599 on a cell phone, no matter how many useful features the phone may carry. As the iPhone remains to be the number one smart phone around, the product continues to grow, increasing size capabilities, increasing the number of applications available, and providing new features that are released through new iterations of the phone, continue to provide a greater value to the iPhone while the pricing remains relevant. At this time in the product life cycle, Apple continues to release enhanced iterations of the iPhone. With most iPhone users un-willing to purchase a newer version of the iPhone because of price, the target audience for the newer generation phones is new iPhone customers. With Apple's installed base continuing to grow, they have found a way bring in reoccurring revenue from their existing customers through the sales of their application downloads. As more and more people purchase the iPhone, Apple's audience for new customers continues to dwindle. Fortunately for Apple, they have built in another source for revenue that continues throughout the life of the product. http://ezinearticles.com/?iPhone-Marketing-Strategy&id=4718557

iPhone marketing plan Market Summary The iPhone targets consumers who need to store information and communicate or people who want entertainment on the go. Apples target segments consist of professionals, students, corporate users, entrepreneurs, and health care workers. Currently, the market for high-end phones like the Apple iPhone is small. Few people want Internet, video, and PDA features in one device because of the high price. The smart phone market is still relatively small

compared with general phone market. The market will rapidly increase in coming years due to lower prices and greater power.

SWOT Analysis Strengths Innovative The iPhone has an innovative touch screen that is patented and unmatched by any other mobile product today. It also has many functions of other mobile products all in one device. Compatibility The phone will work with iTunes and with other Mac/Apple products like the new Apple TV, allowing for wireless connectivity to the big screen. The iPhone is also compatible with many Mac OS software tools. Mac OS compatibility means that the iPhone has limitless potential for upgradeability. Ease-of-Use The all-new touch screen interface making operations extremely intuitive. It is radically different from those of other phones or PDAs that recognizes multi finger gestures, just as the human hand normally behaves. The Mac OS X application imbedded into the iPhone assures users will easily recognize what they can do Brand awareness Apple is well known for cool essential gadgets like the iPods along great

technological innovations like the original Macintosh. Price At $350, the iPhone would be sold at a reasonable price for its value. It outperforms any other PDA or smart phone on the market and the convenience of having multiple features combined into one-device increases its overall value. Quality The iPhone has one of the brightest and most scratch resistant screens in the market. It also has a fine metallic finish that is durable and light. The software suite included is also unsurpassed with their ease of use and resistance to computer viruses. Weaknesses Image The Apple brand is not targeted towards business people, which most smart phones have targeted. Does not have a reputation as being compatible with the corporate world. Price Apple does not yet offer lower priced models for more cost conscious consumers. User Interface Touch screen interfaces suffer from the problem of gorilla arm, in which long-term use of a flat, solid surface for input becomes uncomfortable. Opportunities Increasing demand and expansion to a new target segment Apple will continue to target the business productivity market who wants an all in one computing solution. But as technology advances and smart phones get cheaper companies also have a great opportunity to target people who want entertainment. Apple will attract these consumers and get iPod users to upgrade to iPhones. Upgradeable Since software on the iPhone can be updated, it allows new exciting features to be brought in which take advantage of the touch screen ability. Future versions will also be hardware upgradeable. Partnerships Apple can collaborate with many powerful global mobile phone companies to flood the market with iPhones, which reduces costs in marketing and increases revenue through long-term agreement deals. Threats Increased competition Smart phones are easier to make now more than ever. More companies may enter the market, given that there are few barriers to entry other than patents. Competitors or even Apple contractors can maneuver around patents to create similar devices. Downward pricing pressure The iPhone is marketed as a high-end phone, but phone prices are almost certainly going to fall when other companies undercut the price of iPhones. Difficulty expanding into Asian market There is less hype and interest in Asia since smart phones are better known and already widely used. Competition SWOT:

Palm (direct threat) Strengths Experience: Palm has the longest history in PDA market and has experience-developing software for mobile devices. Business brand: It is a well-known brand for businesspeople. Existing software is well established and compatible with many products for this market. The market is familiar with Palm products; significant switching costs are involved in going to an iPhone. Weaknesses Low profile: Not known for groundbreaking innovations or consumer marketplace products. Palms closest iPhone competitor, the Treo, has lower build quality and its interface may be harder to use, being from an older generation of products and unfamiliar to Apple customers. Interface: Reviews complain that the Trios keyboard is small and difficult to use, especially for accessing the Internet. Although some users may prefer having a keyboard built into the device, potential users show a preference towards using the touch screen only. Opportunities: Similarity: Palm can add many similar capabilities to their products that match the iPhone and expand to a wider market through lower cost and higher-power products. Threats: Increasing competition: New competitors like Apple are entering the market and Palm will face difficulty maintaining its market share. Microsoft (indirect threat) Strengths: Financial flexibility and capital: Microsoft has lots of money and development resources. Compatibility: There is a large amount of software already available, such as Windows CE operating system for mobile devices. Windows CE is "proven" technology, just like Palm's software. Brand name: Microsoft is known worldwide for its software products. Businesspeople are likely to order it on the strength of its name, whereas Apple does not make "business machines. Weaknesses: Previous failures in hardware: Zune have not been successful or profitable for the company.

Image: Lacks Apples cool image and customer satisfaction rates. Many people hate Windows and will recoil at the thought of using a phone version. Opportunities: New hardware market: Microsoft has the ability to create smart phone hardware based on Windows CE and already makes an iPod competitor, the Zune. This opens up another major front in the computer wars. Further Windows OS and Office: Microsoft can expand the reach of its dominant OS and its Office Suite, which are huge cash cows for the company. Threats: Market Saturation: The market is too competitive for a company like Microsoft; Microsoft is strong when they have single products to focus on and overcome. In the smart phone market, one size is not likely to fit all. It is a fast-paced market and subject to fads like Motorola's RAZR phones. Product Offering Multi-touch screen many recent products have used touch screens successfully. Digital signatures are made with touch screens now; kiosks in supermarkets and retail stores use touch screens as their main interface. The Nintendo DS game console uses a touch screen to add more game play options. Phone Mobile phones are very common now. Other features in addition to phone functionality have enhanced the abilities of the phone. The phone is comes included with 3G technologies for higher connection speeds. It also supports Wi-Fi, EDGE, and Bluetooth. Camera offers 2-megapixel-camera resolution, which is better than many mobile cameras out there. Consumers consider it a market standard feature on higher-end phones. It has syncing capabilities with image-management software, so that the process of transferring photos is convenient. There is a possible video recording feature. iPod Universally popular music device. iTunes software and store offers incomparable compatibility and ease of use. Internet communicator iPhones design is tailored to Internet use; the wide screen and touch screen make Internet use easy and convenient; the multitude of wireless technologies make it easy to connect. Style iPhone has distinctive design extending Apples well-known styling. OS X Stable, well known, elegant operating system. Style compliments iPhones style. This makes the iPhone very unique and adds a cool factor never present with smart phones. The iPhone software is compatible with all the software found on a regular Mac. Built-in battery iPhone has superior battery life and is easy to recharge. 5 hours of video playback. Talk time is 16+ hours, comparable to market standards. Headphones with built-in microphone Market standard accessory. Beautifully designed to

fit with Apples eye for aesthetics. Loudspeaker (two-way) this feature is useful for situations where microphone is inappropriate; eg. Boardroom conversations. Synchronization with iTunes, iCal, Address Book This is market standard features, but with Apple branding and user friendliness. Distribution
y y y y

AT&T and eventually other major cellular providers like Verizon. Goal is availability with all phone providers. Purchasable direct from Apple online, and from major third-party online retailers like Amazon.com. Apple stores in U.S., Japan, U.K., Canada, and worldwide. All major electronics retailers: Wal-Mart, Best Buy, Circuit City, etc.

Marketing Strategy OBJECTIVES - We have set an aggressive buy achievable objective for the first and second years of market
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First-year Objectives - We are aiming for a 2 percent share of the U.S and U.K. PDA/Phone market through unit sales volume of 445,000. Second-year Objectives - Our second-year objectives are to achieve a 10 percent share based on sales.

An important objective will be to extend on the Apple brand name and link to the established meaningful positioning. Apple has invested heavily on the iPod brand and we plan to capitalize on the brand when marketing the iPhone. We will extend on Apples image of innovation, quality, and value. In addition we will measure the awareness and response in order to make adjustments to our marketing campaigns as necessary. Target markets: iPhones marketing strategy is to differentiate the iPhone from other PDAs on the market. One of our primary customer targets is the middle-upper income professional that need one portable device to coordinate their busy schedules and communicate with colleagues, friends and family. Our secondary consumer targets are high school, college and graduate students who need one portable multifunction device. Mainly this market will be replacing their iPod and cell phone with the iPhone. Our primary business target is to partner with large cell phone service providers, AT&T, Verizon, Sprint and Cellular One; As well as large enterprise software firms where information is critical to the end user. Are secondary business target is mid-to mid-size corporations that want to help managers and employees stay in communication or access critical data on the go. This market segment will consist of companies with $10-$50 million in annual sales. These are entrepreneurs and small business owner who need an all-in-one device for work and play. Positioning: Using product differentiation, we are positioning the iPhone as the versatile, convenient, value-added device for personal and professional use. The marketing strategy will focus on the convenience of having one device for communication, but also music,

pictures, and video, and full Internet access. The iPhone will be promoted as both professional and hip. Strategies Product: The iPhone will have a full year warranty along with an optional three-year Apple Care warranty. We will package the iPhone as tastefully as all Apple products are. Special editions of the iPhone will also be introduced including the iPhone Beatles Edition celebrating the 40th anniversary of Sgt Pepper. We will be shipping in 2008 a cheaper less advanced iPhone along more advanced version of the iPhone designed for professionals with these additional features:
y y y y y y y

Larger, removable disk storage capacity support for USB memory sticks, digital camera memory cards, external hard drives. Lower weight and thinness should fit into a wallet or become the wallet (with features to act as a credit or debit card). Significantly longer battery life should play movies for twice as long; battery should be easily replaceable. 4G wirelesses even faster, more incredible speeds than ever offered on this sort of device. This will leapfrog the competition. GPS functionality more precise information on location. Can link with software to add even more functionality. Peer to peer wireless exchange Zune has this. Lets you easily share your music and pictures. Improved camera For more detailed pictures and high quality video conferencing.

Pricing: We set our base model 4gb at a low $349 dollars. Larger 8gb models will be listed at $399 dollars. We will also sale special limited edition Beatles iPhones upon rollout. These of course are premium versions of the iPhone will deluxe packaging and the entire remastered Beatles iTunes catalog already preloaded. We have decided to lower our prices to ensure we establish market dominance in as short of time as possible. Distribution: We are aiming for massive rollout worldwide at all reputable major retailers online and brick n mortar stores along with cellular phone providers. All Apple Stores the Apple website will dedicate themselves to the iPhone and also provider channel partners by providing product demonstrations. Eye catching displays will be found at all physical stores featuring the iPhone to make the product stand out from the pack. Apple Stores will have the iPhone on display a full month before its worldwide release. This is designed to lure consumers into Apple stores and see the whole range of products Apple can offer. Marketing and Communication: We will integrate our message of revolutionary communications and audio/visual experience together in all of our media advertisements. Prominently featured to differentiate our product against others is the touch screen functionality. We will also emphasize our brand prominently and associated the iPhone with the iPods groundbreaking lineage. Our ads need to be original but tasteful at the same time. Research about media consumption patterns of our targeted audience will help our advertising agency choose appropriate media and timing to reach prospects before and during product introduction. A massive TV campaign is planned for the month of June will feature a soon to be legendary ad that will remind people of Apples 1984 Super Bowl ad and be the

talk of the country, generating further attention. Thereafter, advertising will be appearing on a regular basis to maintain general public awareness and communicate various differentiation messages to several targeted groups. To attract, retain and motivate channel partners to push the product, we will send personnel to inform them on how to market the iPhone along with other Apple products. Marketing Mix June: Major market rollout at AT&T and Apple stores begins in earnest at the end of the month, after finals week for college students. Also available on Apple.com along with select academic institutions and reputable retail chains with well laid out Apple sections. Roll out with ambitious ground breaking ads like famous 1984 Apple ad which introduced the Macintosh slowly over the month as to build anticipation, even to the Mac faithful. The TV ads will all appear on the highest rated shows. Selectively put print ads in high end and famous magazines to emphasize the products innovations. Introduce Beatles Edition rollouts out in select numbers. Steve must appear in numerous special appearances at Apple stores across the country to ramp up excitement. August: Back to school special for students in high school and college. Students get a 100dollar rebate when purchasing a new MacBook with the iPhone. Availability will expand fully to other mass vendors like Best Buy and Amazon.com. New advertising campaign also is initiated to refresh consumers on the product after the hype. November: New ad campaign for the holidays. Price remains the same to increase profitability, no discounts. Continue to tie the iPhone will other Apple products like Apple TV and Apple Airports. Early 2008: Build buzz for next generation iPhone at Macworld. Announce cheaper iPhones along with more Pro versions at appropriate price levels. 2008: iPhone 2nd generation released with another new ad campaign emphasizing the new features. Low cost, smaller version with more limited features released, called iPhone Nano. High-end professional version called iPhone Pro released with greater memory, battery time, video conferencing and professional application support. The original iPhone will get an incremental upgrade. Promote heavily during the Olympics in Beijing to further international presence of Apple and the iPhone. 2009: iPhone gets major technical upgrade with advanced 3D abilities along with a host of still being developed features. 2010: The entire galaxy of the iPhone line will be the leading player in the world of wireless technology with the goal of at least 50 percent market share. Marketing Research We use a large variety of consumer research in order to further improve the iPhone as the market changes. Staying close to the end user and listening to the customer will be paramount to our success. Through the use of focus groups, feedback from consumer surveys and brand awareness studies to insure we know of the iPhone is view by the world. Targeting segments will be important in order to extend the iPhone reach to business and a broader professional

base. Four age groups will be targeted: 15-20 years, 20-25 years, 25-45 years, and 45 years and up. These groups will give an expansive view of the study groups to include middle and upper income individuals. High School and College aged people will demonstrate social uses. The 25-45 years group will be used to determine business application and social/personal use, and finally the 45 years and above will give us a plan to market to more senior well-refined group. This research will be done through surveys (via email campaign through portals such as, iTunes and other on-line application developed for the iPhone) and interviews (in Apple stores) with the same age groups listed above. The surveys will target to not only to current Apple customers but also consumers not currently using Apple products. It is important to weed out members who have a bias view to insure non-prejudice data. In order to bring the iPhone to the front of the business world it is important to research different ways to grow the 15-25 year old group into business uses of the product. Brand awareness will be an important tool in taking the Apple brand from "social cool" to "business cool". We will also ask for feedback on iPhone features, and implement those changes most important to the end user in the next generation iPhone. To ad incentive, and encourage users to participate we'll offer opportunities to win gift certificates. In addition, we will use customer satisfaction studies provided by various private third party firms to get a larger nonbiased sampling. We will also allow users themselves to design their own ideal iPhone online and use any useful ideas to further refine future iPhone models. Finally, we will continuously scour the Apple fan websites to understand what the Mac faithful are saying, as they are our best customers. Financials First year sales revenue: $2.5 billion avg. Wholesale price $500 per unit, variable cost of $250. Total volume: 10 million. $50 million fixed cost. Break-even is at 200,000 units. Our break-even analysis assumes wholesale revenue of $500 per unit variable cost of $250 per unit and est. fixed cost of $50 million. Based on these assumptions the break-even calculation is $50 million divided by $500 minus $250 equals 200,000 units sold. Break-even calculations indicate that Apple will become profitable after the sales volume exceeds 200k. After the first year Apple will make a profit of 1.25 billion minus 50 million in fixed costs. Our recommended price is $350. The markup is 40 percent. We predict that sales volume will increase at least 60 percent from this change; this will decrease the impact of our fixed costs and improve opportunities to increase our production scale, which will further improve profits in the long run. In the short term profits are higher with the original strategy, but greater sales will introduce network effects that help consolidate our market share. Later on, we can release updates to take advantage of a larger market share. Controls Implementation We are going to give workers $5 incentive pay for every non reject phone they produce (20%

of worker total compensation will be incentive pay), $10 per phone six sigma quality program, and compensate each worker $5000 each year for best practice training. In addition, we are planning to use control measures to closely monitor quality and customer service satisfaction. The iPhone will include an Apple Customer Service Bar and a customer service phone number stored in the phone book so that consumers can contact the main headquarters about any possible technical problems. This will enable us to react swiftly in correcting any problems that may occur. Other early warning signals that will be monitored for signs of deviation from the plan include monthly sales (by segment and channel) and monthly expenses. In case of slow sales, we will immediately offer rebates of iPhone to customers who have purchased other Apple products. This will promote synergy and lure buyers to buy other Apple products as well. Apple can demonstrate their understanding of the upper-level consumer for whom style is a key purchasing determinate, and can simultaneously develop deep relationships with two very different segments: those who have it and those who aspire. The combination of updating the product and our low price will allow us to build market share and attract repeat buyers. Marketing Organization Our consulting group of four holds the overall responsibility for the iPhone's marketing strategy and direction. To better adjust our strategy to both domestic and international markets, we will need additional Apple Marketing Managers to execute localization strategy. This is best implemented from the top down. In order to for our strategy to work, we will need CEO Steve Jobs to dedicate the iPhone team of Marketing Managers, Operations Managers, Design Engineers, Hardware Engineers, Software Engineers, Product Managers and Business Development Managers. These people will be essential in building not only the product, but also the relationships necessary for sustained growth. Apple's Marketing Managers will need to seek ad agencies to implement our promotion. However, Steve Jobs will be the ultimate media spokesperson. As Marketing Managers come up with new feature and attributes, Operations and Engineering will need to implement them quickly to ensure customer satisfaction and loyalty. Our Process: To plan our strategy we will meet monthly with the board of Apple, present our information, and make a proposal for continued marketing efforts. Before each meeting our team will meet in private, with each person presenting their own proposal based on the information they have learned. After the initial proposals, we will vote on the best one or come to a compromise. The final proposal sent before Apple is the result of that meeting. Authors: Colleen Maxwell, Bryan Lee, Anthony Suen, James Hofmann. Alex, May 22, 2007 #1 http://www.iphoners.com/threads/iphone-marketing-plan.141/ As with most Apple company advertising, the new iphone 4 web marketing strategy is incredibly clear, classy and brilliant. While using thats the truth apple company company symbol, Apple company is focused on the genuine innovative kind of some without the need

of all the Half inchblowHalf inch. The new iphone 4 was released by Apple company in August, 2007. The bottom-smashing kind of the new iphone 4 was recognized for months until the preliminary relieve and has continued to be the talented on the subject of cell phones more than online loans past a long period. Prior to the apple i phones established relieve, Apple company leaped a number of tv set commercials endorsing the brand new mobile phone. The very first of the commercials molds the brand new new iphone 4 as phase 2 up with the preferred ipod devices. Ipod and iphone was popular up to here, as well as the new iphone 4 was supposed to be another-age group ipod devices, oh yea, and its also a cell phone! The marketing demonstrates each of the improved capabilities obtainable in ipod, and a lot more, the actual currently being Half inchThere is certainly certainly not been a music player that can accomplish this.Half inch Half inchSo, say youre enjoying Buccaneers of the CaribbeanHalf inchFinger trys to follow video clip and demonstrates wide screen motion picture.Half inchMmm, quick loans another person say Calamari?Half inchFinger mouse clicks time for menu, prefers Road directions request to go looking Seafood.Half inchThe closest will beHalf inchMap demonstrates all fish and shellfish places and illustrates spot nearby for you.Half inchAh!Half inch Finger mouse clicks fish and shellfish spot, and eatery mobile phone number available. new iphone 4 dials. The very first a number of new iphone 4 commercials showed off the actual, advancement, and success of a single merchandise using the efficiency of really not a telephone, or even a popular music unit, but a product that can, among other things, take note of popular music, check out movies, watch pictures, make office meeting phone calls, check ourite-mail, look at the world wide web, and view routes. Besides Apple company use tv set with regard to their web marketing strategy, however they make use of their site by writing movies, additionally publicized some touch investing that might have been produced in only one papers. Apple company frequently uses this course to formulate hype as well as leaving the individual wanting a lot more. With Apples small pr releases, allowing the listeners little to travel down, Half inchApple company geared a law of societal physics news flash, like mother nature, abhors vacuum pressure. Even without authentic facts, those that love a program will comprehension at any gossip which comes their way. Apple company could widely disavow the gossip Web pages that scramble for leftovers regarding the providers ideas, but covertly their advertising unit should be happy. It will be expensive to purchase that type of Web advertising.Half inch (Silverman, 2007) The state run new iphone 4 site does not just supply information about the merchandise. It delivers top tips and tricks for the application of an apple iphone, or a massive consentrate on programs. Just about the full new iphone 4 web site demonstrates photographs of programs, affords the Half inchRequest of the Week,Half inch the website also includes portions referred to as Half inchApps for Every thing,Half inch as well as the Half inchBest Apps.Half inch Apples site is a great marketing strategy for present new iphone 4 end users and customers with an fascination with buying the new iphone 4. The advertising and marketing of the programs can create a better cause of revenue for Apple company. As shoppers see

best rated software, they may get a hold of the request, as an alternative to looking via 25,000 programs to get just one which can be of a typical value to the purchaser. Prosperous more youthful guys were the target market that Apple company got initially centered on. Apple company got anticipated utilizing this potential audience, and the fact that 48Per cent of the market failed to witout a doubt personal an Apple company ipod devices, would permit them achieve their estimate of tens of millions of product sales at the end of 2008. A month prior to a release of the new iphone 4, Solutions Research Team profiled a cross-a part of these conscious of the cell phone. The estimate of possible buyers throughout the day of the relieve ranked many Testosterone levels-Cell shoppers, AT http://www.liantongflh.com/?p=61

The iPhone 4 Now & Wow Marketing Strategy

Thu, Jun 24, 2010 TimDeTellis.com Call it genius marketing. The hype of now and the power of wow are the magic combination of Apple marketing. How did Apple channel the energy of the new iPhone 4? 1. Pre-launch reservations 2. Extra early store openings 3. Exclusive day-of-release purchase at Apple store locations only The secret ingredient is exclusivity by holding back product details from store employees and the marketplace until Steve Jobs himself reveals the masterpiece. This strategy controls the channel of communication and builds focused energy which Apple can then leverage. What can we learn from the launch marketing strategy of Apple? A. Lead with the wow factor. This changes everything. Again. B. Build a focused moment. Then maximize that energy. C. Keep the masses behind a wall. You can only enter the castle through the front gate. As I stood in line at 6:20am this morning for the iPhone 4 release, the pre-order line of customers were guaranteed a phone. The non-reservation line of customers was all told by mega-phone, you might be disappointed today. They took away the opportunity. Then they gave it back. You will have an Apple store employee come and collect your name and email to be placed on a priority list to receive an iPhone 4. Well, this afternoon, at 4pm, I was back at the same store as this morning and there were people still in line. Each without a reservation, or pre-order, but were able to acquire their prized position. The power of now combined with the power of wow sold them. As people walked out of the store with their new iPhone 4, the line would applaud. Welcome to the exclusive club.

How will you market and communicate your cause or product differently because of the example of Apple? By the way, Im still content with my iPhone 3GS. http://timdetellis.com/2010/06/24/the-iphone-4-now-wow-buzz/