Expansion of Apple Company Business - Essay Example

Marketing College: Executive summary Apple Inc. is a technological giant, American based company that specializes in production of software, consumer electronics, personal computer, peripherals, digital music players, and other electronic accessories. The company was started in 1976 with its main business being production of computers. However, the company has been growing at a very high rate and introducing other technology related gadgets into the market, products that have completely changed the entertainment and communication industry. The company was founded by Steve Jobs and is said to be among the most popular corporates worldwide because of production of classic products like IMac, iPhone, IPods, ITunes as well as MacBook. Introduction Expansion of business of organizations is one of most popular trends in the 21st century, whereby most companies are going global in order to reach new markets (Urbany and Davis, 2010, p.153). The level of competition has extremely gone up in both the domestic and international markets thus calling for adoption of proper strategies that can enable business organizations remain competitive and increase its market share. One of these companies that have experienced enormous growth is the technology giant, Apple Inc. Ltd (Luther, 2001, p.43). The company has been able to expand and increase its sales despite the stiff competition it faces from other techno giants like Microsoft, Samsung, Lenovo, and Dell among many others. This has been made possible by the incredible marketing strategies that the company applies, which always gives it an upper hand in this competitive industry (Rosenberg, 2011, p.88). This report will focus on the Apple Company and use it to explain the concept of successful marketing. Main findings Marketing is one of the major aspects that highly determine the future growth of a company. Marketing refers to deeds done primarily to realize firm’s goals by engaging in clients need as well as directing the flow of need-satisfying products from the producer to the consumers. Effective marketing highly influences the future success of an organization (Paley, 2006, p.36). Positive effects of marketing can be well illustrated by focusing at the successful trend of Apple Corporation. The company has been able to introduce new products successfully in the existing market as well as penetrating into new markets with the existing products among many other aspects as covered by Ansoff’s Growth Matrix (Mohr and Slater, 2010, p.196). Apple Company has introduced numerous products in the market, whose demand and popularity has dramatically grown. Some of them include the incredible Apple computers, iPods, iPhones, and iPads including software among many others (Schneiders, 2011, p.83). Their products are of high quality and unique, major factors that make them sell like a hot cake. IPods and iPhones are some of the products that made the company make a breakthrough and become a global giant. IPod in particular made a huge splash into the industry immediately it was launched (Westwood and Institute Of Directors. IOD., 2002, p.71). It had unique features such as vibrant colors and could download music and movies from online stores among other incredible features. This new product was being introduced in the existing market and effective marketing made the product to sell in an astonishing way. Since then, the company has been expanding its operations to other parts of the world (new markets with same products) and it has secured a big market share all over the world. All this can be attributed to effective marketing and the quality of their products (Rao and Klein, 2013, p.112). Apple Company applies a hybrid of strategies that makes it remain competitive and continue on increasing its global market share despite the stiff competition in the industry (Kalb, 2001, p.25). One of the utmost strategies that the company highly relies on is the aspect of successful marketing. The company’s marketing targets at educational divisions particularly college and university students, home users, micro and medium enterprises, imaginative individuals and artists, and most importantly the brand loyal (Gupta and Rangan, 2012, p.98). However, most of its sales come from the youths. (Alikhan and Mashelkar, 2009, p.189) Despite the mentioned above targets, the company’s adverts are very appealing and tend to attract the attention of all groups of people. Such promotion has been witnessed in their latest Siri Technology among the launch of other products (Richter, 2012, p.86). Over time, the company has been able to utilize the practices and tactics of integrated marketing, which have grown their sales immensely. Their common integrated promotional tactics include web design, advertising, and digital marketing, which have exhibited extreme capabilities especially if well combined and coordinated (Bidgoli, 2010, p.32). Other strategies that the company has engaged in that have given it a successful history is the application of an effective distribution channel. Apple never sold its products directly to the customers not until the introduction of internet (Kennedy, 2006, p.89). Instead, the company was using authorized dealers who could sell the products directly from them to the customers. The method is still applicable up to date in some countries and it has proven to be a prudent idea. For instance, after the launch of iPhone, Apple chose O2 to be the only network operating for them (McGuigan and Harris, 2008, p.25. The strategy helps a lot in making the company adapt to the local market since the different chosen dealers know the local markets well hence they are able to easily get their targets through promotion that focuses on meeting the local people’s market needs (Kelby and White, 2010, p.158). However, the company has started opening their own stores in order to understand and meet the needs of the market (Baumann, 2010, p.12). The major reason why the company has adopted this new distribution channel is the fact that dealers are not experts in apple products hence fail to answer customers’ questions. Some of their dealers include Carphone, Warehouse, mobile shop, PC World, Curry’s, ‘planet audio’ and online distributors like ‘Mac universe (OGrady, 2009, p.65). Other strategies include the application of corporate social responsibility (CSR) which involves taking good care of the society and the environment in general (Roll, 2005, p.102). Building a strong brand is another major strategy that has given the company an upper hand in the market. This has been achieved as a result of production of classic goods that so far only Apple and Apple alone can produce. The company’s product and technology has simply changed the world in terms of communication (Ferrell and Hartline, 2011, p.108). They are quality-oriented irrespective of the production cost, a factor that has made the company win the confidence of the consumers. In addition, the company has engaged other approaches such as buzz marketing whose main target is retail distributors, stores, sponsoring sporting activities as well as application of viral marketing strategies (Bowman and Gatignon, 2010, p.300). A hybrid of all those competitive strategies among others have made the company one of the most successful corporation globally (Sadeghi, 2012, p.37). According to the recently released SWOT and marketing competition analysis, certain elements of marketing mix commonly referred to as 4Ps can be applied (Böhm, 2009, p.175). However, it is important to look at the recent SWOT analysis briefly. The analysis showed that Apple was enjoying a number of strengths with the main ones being strong brand, innovation, customers view, and incredible technology (Yami, 2010, p.178). The company enjoys a privilege of having a favorable brand perception that has contributed a lot toward its growth (Fisher, Pride and Miller, 2005). This makes it easier for it to launch new products, which gain very high demand within no time to a point of having loyal customers (McDonald and Keegan, 2002, p.196). In addition, their ingenious innovations always give the company a competitive edge even though it has been recently dormant in terms of innovation since the death of its former Chief Executive, Steve Jobs. Its opportunities include the untapped huge market of smartphones since demand for smartphones is growing on daily basis as the world migrate from being analog to digital and the company has managed to secure a market pie in this field (Esslinger, 2009, p.52). The major weakness of the company is the death of its founding father, Steve Jobs as well as the declining research and developments(R&D). Steve Jobs is termed as one of the geniuses of inventions and innovations that have ever lived (Oswald, 2012, p.42). In terms of threats, intense competition from other major firms is one of the major threats the company is facing. The company faces extreme competition in personal computers, related software consumer electronics, as well as peripheral products (Kourdi, 2009, P.105). Microsoft, Dell, Samsung, and Nokia are its major rivals. Laying focus on the marketing mix of Apple, appropriate marketing approaches can be easily be devised. Marketing mix represents the 4Ps that are applied in identifying market gaps that can be exploited in the future. They include product, price, promotion, place and (distribution), (Lieber, 2008, p.93). Apple produce classic products that are of high quality though they are slightly expensive that those of their close competitors. Economists claim that the company applies the price skimming strategy of pricing but their products are never affordable compared to those of their rivals like Nokia and Microsoft (Abbing, 2010, P.14). Place in this context refers to methods of delivery, storage or any other mode through which customers can access the goods. Adoption of a combination of a distribution channels (using dealers and opening their own stores) is highly commendable and the move is likely to grow the company’s sale drastically, now and in the future (Wood, 2005, p.162). Under promotion, the company communicates its products in a number of ways such as through TV Adverts, online stores, radio & newspaper, and Apple retail stores (Crowther and Aras, 2008, p.225). All these can be integrated and be well coordinated to devise a very strong marketing strategy for the company (Markides, 2008, p.85). However, a number of factors can hinder the success of the explained marketing plan. One of the major limits is the escalating production cost of various types of products in USA, a factor that some economists associate with the great depression the country suffered in 2007/2008 (Gong, 2013, p.36). China on the other and has very favorable conditions for corporates investments and this has made most companies to relocate their operations to China (Zhang and Alon, 2010, p.109). Of late companies like Lenovo have relocated to China with Nokia partially collaborating with Chinese firms. Therefore, it is important for the management to look for possible avenues of reducing production cost so that Apple products can be affordable to many people by relocating to China (Sehgal, 2011, p.93). Another limitation is the issue of unfavorable competition in the industry by the rivals. Some companies like Samsung went to an extent of illegally using Apple’s technology in many countries (Bryer, Lebson and Asbell, 2011, p.108). Luckily, Apple’s intellectual rights were well protected hence the company was compensated. The issue of counterfeit products especially in the electronic industry is another major limitation (Terry, 2002, p.28). However, this can be overwhelmed by sensitizing the public on the need for buying original products. Moreover, lack of swift innovations is likely to be a problem especially with Steve Jobs being no longer in the management. This can be subdued by funding more researches and recruiting new young and ambitious persons, that among them the company might get another ingenious innovator (Hirzel and Bayer Material Science AG . 2011). Recommendation It is highly recommendable that the company would continue on improving the PC so that it can remain competitive in this highly competitive industry. It should also maintain its spot in the entertainment industry particularly in the music industry by producing more and more gadgets that would continue building the company’s brand. Moreover, Apple should focus on doing more research since innovation and production of quality products are the primary elements that differentiate the company from the other manufacturers. Conclusion Organizations growth greatly relies on the set strategies by the management. This aspect has seen Apple become one of the best companies in the world as a result of adoption of a hybrid of strategies. However, the company is facing numerous threats like unfavorable competition, high production cost, presence of counterfeit in the market among others. In order for the company to survive this strong competitive wave, the management has to come up with ideal strategies that will give it an upper hand in the market so that it can maintain or grow its current market share. Bibliography Abbing, E. R. 2010. Brand-driven Innovation: Strategies for development and design. AVA Academia. Lausanne, Switzerland Alikhan, S., & Mashelkar, R. A. 2009. Intellectual property and competitive strategies in the 21st century. Wolters Kluwer Law & Business. Austin. Baumann, C. 2010. International Marketing plan for Volkswagen. GRIN Verlag GmbH. München. Bidgoli, H. 2010. The handbook of technology management. John Wiley & Sons. Hoboken, N.J. Böhm, A. 2009. The SWOT Analysis. GRIN Verlag. München. Bowman, D., & Gatignon, H. 2010. Market response and marketing mix models: Trends and research opportunities. 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