Marketing Strategy for Apples iMac - Term Paper Example

? Marketing strategy for Apple’s iMac Marketing strategy for Apple’s iMac Executive summary TheApple Company is one of the biggest companies that deal in the production of software and hardware worldwide. The company is however the leader in innovation and production of items, whereby it produces one after another with great success. Recently, the company produced the iMac which is yet to hit or penetrate the market, hence the importance and necessity of developing a market entry strategy. This will help the company in bringing together all the basics of marketing for the purpose of ensuring that the objective of the promotion; that is entering a new market of the new innovation is achieved. Introduction The first iMac was the earliest legacy-free PC. The original iMac was the first ever Macintosh computer not to have the FDD and to be fitted with a USB port. All the Macs have consequently fitted it. Through the USB port, we find that the makers of hardware could produce items that compatible with both the Macs and the x86. Initially, the users of Macintosh were forced to look for particular hardware, like the mice and keyboards that were specially designed for the ‘old world’ the exclusive ADB interface and modems together with printers with the LocalTalk ports of the Mac. Only a small number of the models from particular producers or companies came with these interfaces, and usually and often went at a premium price. Being cross-platform, we find that the USB has enabled the users of Macintosh to choose from a large variety of devices that are promoted for Wintel PC platform, like storage devices, mice, canners, USB flash drives and hubs. As the USB was slower compared to many ports present at the time like the SCSI, iBooks, and the unmodified iMacs were seriously crippled until sufficient replacements like the USB 2.0 and FireWire were standardized. However, after iMac, the company continued removing the older floppy drives together with peripheral interfaces from its remaining product line (Carroll, 2011). Borrowing from the 20th Anniversary Macintosh of 1997, the different iMacs designs that are LCD-based maintained the all-in-one idea first envisaged in the original Macintosh computer of the company. Nevertheless, the successful iMac enabled the company to continue with its targeting of the Power Macintosh line at the market’s high-end. This prefigured the same concept in the notebook market when the iBook that looks like the iMac was launched in the year 1999. However, since then, Apple has maintained this concept of consumer differentiation against the professional product lines (Sculley, 2009). The focus of the company on design has enabled all of its consequent products to establish a distinct identity. The company avoided the use of the beige colors that were pervading the industry at that time. Apple would later shift from the multihued designs of the late 1990s and the early 2000s. However, the later part of the twenty first century’s first decade saw the company applying the anodized aluminum and black, white, and the clear polycarbonate plastics. Several PCs currently, are more design-conscious compared to the period before the introduction of the iMac, with the multi-shaded schemes of design being widespread, and some laptops together with desktops present in multicolored, and decorative or pretty patterns (Frank, 2010, p52). The campaign is to be carried out in the United States and in countries all over the world. The time frame for theses objectives to be achieved will be twenty four months. As the company works towards the introduction of upgraded and newer products, adjustments and refinements may need to be undertaken. However, the most important thing is maintaining consistency. Moreover, since both objectives are based on one another, the company should primarily focus on putting emphasis or stress on the extensibility message in attempting to speed understanding to the idea or concept of digital lifestyle (Chposky, 2010). The objectives of the plan in this part should be achieved in a fairly shorter period of time. Product description The iMac can be described as a range of all-in-one of multifold Macintosh desktop computer that is designed and developed by the Apple Company. The product has been the principal part of the consumer desktop offerings of the company since it was launched in the year 1998, and has developed or grown through five different forms. Nonetheless, in its initial or original form, we find that the iMac G3 had a shape that looked an egg, with a CRT monitor, which was principally covered by a decorated, transparent plastic cover that was invigorated early on with a shiny design famous for its slot-loaded visual drive. Consequently, the second main adjustment, the iMac G4, changed the design to kind of a semi-circular base consisting of all the major components together with an LCD monitor on an unreservedly or freely moving arm on it (Smith, 2011). The third and fourth main adjustments, the Intel iMac and the iMac G5 put all the constituents directly behind the display, forming a slim combined design, which only tilts up and down on a plain metal base. The present iMac has the same form as the initial or former one, even though it is a bit thin and has anodized aluminum together with a glass panel on top of the whole front. Furthermore, it has an addition of the SDXC slot that is placed immediately under the SLSD, Slot-Loading SuperDrive. Some newer editions are available that have a solid state drive in place of a hard drive. The latest version comprises, across the line, a quad-core Intel processor, 2 (on 27”), a FaceTime HD camera, which are the features that were introduced during the early 2011 (Smith, 2011). Situational analysis Same designs in the other consumer devices were stimulated or inspired by the use of plastics that are translucent and candy colored by the company. For instance, pencil sharpeners, peripherals and video game consoles, portable electronics and grilling machines involved the translucent plastics. The later launching of the iBook G3 and the iPod, that all featured snowy clear plastic by the company, inspired same designs in the consumer electronic products. Nevertheless, the color rollout also comprised of two unique ads; one known as ‘Life Savers’ featuring the Rolling Stone’s song called ‘She is a Rainbow’ (Levy, 2005, 30). The Apple Company has had great success since its initiation in the year 1977. It is difficult to be in a position of predicting what will happen in future to the company, however, a SWOT analysis can help in understanding the present position of the company and where it might go in the future (Ferguson, 2009). Strengths The strengths of the company are being a design inventor that is far ahead of the trends, establishing ergonomic electronics, which fit the lives of people. The company has particularly been able to invest considerable in research and development, whereby it invested eighty million dollars in the quarter ended in June 2010. Weaknesses The company admits that its profitability depends on the global economy. That is economic slumps can have a substantive negative impact on the company, and shifts in the foreign currencies make predictions of profits in the international markets uncertain (Rose, 2008). Opportunities The company launched a new mobile advertising platform for the iMac, iPhone, iPad and iPod touch. The introduction of this platform of advertisement represents an opportunity for some new sources of revenue (Moritz, 2009). Threats The company is involved in many legal actions, which include claiming infringement of patent and antitrust violations. Most of the suits are from the smaller related companies, but common plaintiffs include the Nokia Company. These lawsuits actually present a great threat due to the possibility of harsh judgments together with the ongoing costs that are associated with the legal defenses (Porter & Norton, 2011). Problem definition The Apple Company has a venerable history of design and product innovation. Since initiation in the year 1976, they have constantly been considered as a leader in the development of both software and hardware that pushed the technological limits and also easy to use, fashion conscious and reliable. However, considering this legacy, the overall market share of the company in the personal computer market is very tiny. When put in the historical framework whereby this happened and the way the market responded, the early decisions of the company concerning distribution strategies and licensing seriously affected its overall ability of getting their product into the hands of the consumers (Smith, 2011). Whereas they tested with an alternative licensing and distribution strategies that were used in the prevailing Windows platform, we find that these were deserted. Both of these facts greatly limited the ability of the company to be in a position of penetrating the larger market. As a result of this, Apple has more and more attempted to find solutions that allow the users of computers to be able to extend the practicality and functionality. The company has recently utilized its skills in innovation and introduced its iMac with much success (Smith, 2011). In so doing, it has seen a growing number of the new users of its products, and consequently established a strong conduit that should be fully exploited in order to stir growth of its overall brand. These advancements also show that Apple can maintain its relevance to the customers in several new ways, ones that are not strictly centered on its major operating system; the Mac OS, as well as its derivative hardware. However, to help capitalize on this achievement, the integrated marketing communication plan presented seeks to fulfill two major objectives. The first one being to define as well as communicate the idea or concept of an inclusive ‘digital lifestyle’ and comprehensively explain the value that this brings to its major creative consumers; and the second is establishing the company as major provider of the value-added items that provide secure, reliable, and integration together with extensibility that is platform-neutral. If successful, the company can influence its improved brand-awareness to move more customers to their related hardware products and operating systems (Smith, 2011). Identification of alternatives Being in a position to choose the most suitable approach for the launching of a new product or even the product of a new venture or project from an already existing corporate base is a very difficult charge. Should the entry into the market attempt to fast seize important market position or seek furtive penetration? Certainly, there is no single approach that fits all industries or companies, markets and products. The viable approach for an established company to start a new investment and launch a new product or service must be determined by the properties or features of the company, the market, and some other environmental factors. In this analysis, I am going to give or discuss the best and most competitive strategies that the company in ensuring that their entry into the global is successful (O'Grady, 2009). This use of the imac being a new technology that has never been in the global market before, it is important for the manager to ask him or her some basic questions before thinking of even taking the first step in the whole process. They should ask themselves whether it pays to be the first with the product or service. They should also ask themselves whether being an inventor is worth the risk; the proper balance between the rewards and the risks; what they can do as the innovator to prevent share erosion when the market receives a new player; the strategies that should be applied in order to ensure that the entry is successful. Several studies show that in most instances, being the first to enter the market offers a substantive as well as constant market-share advantage over the later entrants. Nevertheless, the later entrants can be successful by adopting unique marketing and positioning strategies. According to Cunningham (2009), once innovators in most industries have reached the position of incumbent, they are always very powerful. However, at times they get satisfied or are not able to cater for the shifting or growing demands of the marketplace. Criteria for making the decision Choosing a country A very important starting point in taking a business global or in the selection or consideration of the location of any global direct investment is the taking of a wider view of the distance between the two countries, rather than just the distance from the mother country bin terms of kilometers. For instance, it is important to measure the distance in terms of the following: Cultural distance; this can be measured in terms of language, religion and ethnicity, to determine whether they are favorable for the business. However, this being an issue of technology, these target market should not have rigid religion and ethnicity that can hamper the introduction of the product into their market (Davis, 2006). Administrative distance; There should be no political hostilities within and between countries, and their government policies should also be favorable to the establishment of the business. Geographic distance; The distance between the regions is also another factor to be considered. The place where the company wants to take the new product should not be so far from the mother country so as to reduce costs such as those of transportation. Some other important factors are sizes and physical remoteness. Economic distance; cost differences and differences in consumer incomes. Deciding on a location According to American companies, the major factor that influences their decision on location is the size of the market in which they are to enter. Exposure to a wider range of small and large markets greatly increases geographical base for the generation of revenue. Some other reasons cited as essential to the decision on location include the following; Economic stability; the growth rates, interest rates and incomes should be steady, with low costs or production and inflation rates. There should also be adequate resources to cut down the costs of importation. Political stability; the selected country should have a good history of political stability and monetary and fiscal policy. Geographic borders; the population of the country should be big so as to provide a wider market for the products, and the climate should also be favorable for the production of the good. Infrastructure; the selected country should have a good road network for ease of communication and transport. This can greatly help in reducing time wastage, thus cutting costs. Business ethics; there should be no language barrier, and the culture and ethnicity should embrace the business venture. Competitors; it is very important to consider the availability and the potential of competitors as well as the industry structure. Tax; tariffs, tax policy together with other trade barriers should be considered in order to determine whether they are considerate. Other factors to be considered are the incentives that are provided by the government (Kaatz, 2009). Labor costs; the chosen location should have sufficient availability of cheap and skilled labor. The business should also find out whether there are potential local partners in the country for any possible partnership There should also be availability of local suppliers to avoid wasting a lot of time in the distribution of the goods. Market entry strategies There are several strategies that can be used by a business in entering a new market. Each of the strategies has different levels of legal obligation, risk, disadvantages and advantages (Kamaroff, 2008). For this venture to be successful, the following factors should be kept into consideration: Local office The exporter, which is the Apple Company, under this foreign direct investment form should establish a local presence via a branch office or even a representative, rent office space and then hire staff (the staff could be just a single person). However, in doing this, there are some advantages and disadvantages that the company will have to experience (Kaatz, 2009). Advantages By establishing a local office, the company will be in a good position of controlling marketing and distribution. It also gives the company a direct contact with the customers, since there will be a physical place or office where the management meets the clients and deal with them directly. The physical presence of the office also improves credibility in the market place with the customers as it gives them a place to air their views. It also helps in giving an access to the local venture capital. Disadvantages Although having a local office in the country or location is better and more sufficient than just having an agent, we find that the cost of establishing the office is higher than just using a distributor or an agent. In the establishment of a local office, we find that there is no local partner with contacts together with expertise as in the case of a joint venture. Strategic alliances If the company at some point wishes to go beyond the simple exportation of goods and services, then joint ventures, licensing together with offshore operations must be explored. Whereas direct exporting might be a beneficial way of entering the market for some businesses, we find that the licensing of manufacturing rights to the business or product to a foreign business or company or even setting up of a foreign manufacturing joint venture may be viable options. The strategic alliance partners are normally determined or identified via accountants, bankers, industry networks and associations, government contacts, and business consultants (Jackson, 2007). Management issues with the market entry strategies Product’s uniqueness; the uniqueness of the product is one important factor that greatly helps in ensuring that it hits the market well. Being that the imac is a new product, its chances of becoming successful are high as it will be the first time it will be entering the market of the country and consumers will be anxious and exited about it. It is also important for the management of the company to have international experience as well as knowledge of the cultural issues that might affect the entry and success of the product. Barriers to entry; the management should be aware of all the things that might affect the process of entry of the product into the market. This should be done in time in order to avoid taking too long in trying going through the process. The business strategists should also ensure that a good business model is designed to ensure its success. Before settling on how to carry out the business, it is essential for the management to carryout survey and determine the cheapest way of doing it. That is they should compare between producing the caps locally overseas and producing them within the United States and then exporting then. But here, I think it will be easier to produce the gadgets locally overseas if the resources are available; however, if the resources are not available locally overseas, then it becomes easier to produce the goods in United States, and then exporting them to the target markets. But this also depends on the tax charged on the goods imported into the target markets. The business should also determine whether it is better to license in order to infiltrate more markets faster. It is also important to establish whether the business has been insured against the non-payment. It is also essential to address the conflicts or legal issues with the partners, if any. The company should also ensure that it has a plan for an increase in the currency. Availability of distributors; the company should ensure that there are several reliable and flexible distributors in the country. Unlike the agents, we find that the distributors normally buy the goods and then resell them to the local customers that they know best. These people are important as they are usually close to the consumers and know where to fin them easily. According to Keegan (2006), they also serve as an important part to the company as they break the stock into smaller sections that can be consumed by the customers. They usually set the selling price which is convenient with the final consumers. They also offer buyer financing as well as looking after service and warranty needs. The distributors normally offer after-sales services on behalf of the company in the foreign market. Recommendations It is important for an organization to be an ever-changing organization that would be able to cope with future change initiatives. Long time ago, organizations were run just anyhow because the people during that time did not have sufficient skills to be able to run or manage their companies well. They did not know how to make organizations grow to some higher levels. However, currently, the growth of organization has become the headache of each and every manager or supervisor of an organization, thanks to the stiff competition that is now dictating the market landscape. The world is ever evolving with everything going high-tech; this means that the dimensions demands are also changing significantly. Therefore, it is important for each and every organization to be flexible to change in order to accommodate new ideas that are essential to growth. Nonetheless, it is the sole responsibility to initiate these changes by playing the leading role. The leadership of organizations should be in a position of carrying out extensive research in order to find out what is good for the growth of their organizations, and then try to introduce them to their places. They are supposed to play leading roles in bringing together all the elements together with environment required for change; by accommodating change, they would see significant growth in their organizations. Nothing can always happen without the consent of the leaders or managers, therefore it is important for each and every organization to ensure that its leader is a good one and who is not resistant to change. The leader should be in a position of rallying together all the employees, boards and all stakeholders in an attempt to try exploring all the possible means of ensuring growth (Schermerhorn, 2010). The FDI (Foreign Direct Investment) refers to the direct ownership of facilities and equipment in the target market. I believe this is the best way for the Apple Inc to go as it proves to be the most efficient. Being that the company establishes itself there with all its facilities, it would be easier for it to produce large volumes of the product to meet the demand. Direct foreign investment involves the transfer of resources, which include technology, personnel and capital (Muller, 2011). By establishing a base in the target country, it would be easier for the business to reach its customers as the company will look or appear more local than international; this would make the customers to feel more attached to it, rather than feeling like they are dealing with a foreign company or foreign products. This kind o investment can be done in two major ways, which are the acquisition of an already existing entity or even establishing a whole new enterprise. Direct ownership actually offers a high degree or level of control in the operations together with the ability of better knowing the consumers and the competitive environment (Foley, 2006). Nevertheless, it requires a high resource levels as well as a high level of commitment. Anticipated competitive reactions It is highly anticipated that the rival companies that also deal in the same industries will also try to counter the strategy employed by the Apple Company so as to maintain their market share. However, as the innovator or pioneer of the technology, the company has every right to protect its product and position in the market (Schermerhorn, 2011). Even as the new entrants try to reshape and redefine the business or even formulate the niche strategies in order to attack the profitable industries together with market segments, the inventor can be able to fight back its competitive advantage. The three main strategies that the company can use include: Increasing the barriers for the late entrants, so that they can find it difficult to enter the market. Innovating faster than the late entrants, so that they can have nothing to brag about. Building a market flexible and responsive organization In many markets late comers and innovators operate with insufficient or incomplete information. As the inventor, the company can take advantage of this by the use of efficient signaling mechanisms as a restraint. For instance, the company can reduce price, to show the new entrants that it is a low-paying industry and thus, it will not be easy for them to survive. The company can also protect its market by trying to block the major distribution channels, which would make it difficult for the new comers to be able to access the market. The company can as well provide special kinds of enhanced customer services packages or even reward programs in order to make it difficult for the loyal customers to switch. Evaluation metrics Nearly all tasks can actually be measured and judged in accordance with a standard set of criteria. Giving correct feedback that is candid, impersonal and comprehensive can help individuals in several various ways (Kotter, 2011). A candid assessment can also help the workers and managers in several different fields in creating a better and also a fairer workplace. After the process of entering a new market is complete, the last and most important step in the evaluation to determine the level of success. The assessment can be done by evaluation or consideration of the reception that the product is given by the target market, and this can be determined by the numbers sold and revenues generated. Bibliographies Carroll, P. (2011). Big Blues: The Unmaking of IBM, Crown: New York. Chposky, J. (2010). Blue Magic: The People, Power and Politics Behind the IBM Personal Computer, Facts on File: Oxford. Ferguson, C. (2009). Computer Wars, New York: Random House, pp45. Frank, R. (2010). West of Eden: The End of Innocence at Apple Computer. Frank Rose, pp52. Hurwitz, J. (2011). 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Journey of adventure, ideas, and the future, New York: Harper & Row. Smith, D. (2011). Fumbling the Future: How Xerox invented, then ignored, the first personal computer, New York: William Morrow. Read More