Ch. 17 - Advertising and Public Relations

According to MKTG5 Advertising is defined “as impersonal, one-way mass communication about a product or organization that is paid for by a marketer.”

In the past two decades, Apple Inc. has become well known for its advertisements. Its most significant ad campaigns include the "1984" Super Bowl commercial, the 1990s Think Different campaign, and the "iPod people" of the 2000s. 

This ad is the perfect example for the creatively and uniqueness Apple uses in its ad's. Apple has always been a trendsetter when it comes to style and technology, but with these ads, Apple had started something epic...the silhouette of a person dancing to a song that they're listening to on their Ipod. By viewing this ad, a person can imagine themselves owning an Ipod and jamming wherever or whenever. These ads help take mp3 players to another level where Microsoft created some competition with a product called Zune. There were other companies creating ads very similar to Apple’s. This was a great marketing strategy and the profits showed for Apple. Today, Ipods still are the biggest music player in the world. Various types have hit the stores over the years. Apple continues to be the cutting edge company in technology, and this was the ad to help take Ipods to a new level.

Apple mainly focuses on product advertising, According to its annual filing; Apple spent $933 million on advertising in 2011, $691 million in 2010, and $501 million in 2009. Its total sales those years were $108.249 billion, $65.225 billion and $42.905 billion. Apple Inc. have deepen discussions to start an advertising-supported streaming radio service by early next year, because sales of music downloads are declining , Apple and record companies want to create new ways for customers to discover and buy digital music.

 

According to the MKTG 5 Public relation refers “Public relation is the element in the promotional mix that evaluates public attitudes, identifies issues that may elicit public concern, and executes programs to gain public understanding and acceptance.” For Apple Inc. the public relation can be defined as a 

Ch. 15 - Retailing

The Role of retailing

The MKTG 5 describes retailing as “all the activities directly related to the sale of goods and services to the ultimate consumers for personal, non-business use.” This means that Retailing is a distribution channel function where one organization buys products from supplying firms or manufactures the product themselves, and then sells these directly to consumers.

This week I had the chance to visit one of the Apple store located on Fifth Avenue, 767, New York. Just like Apple Product, the retailing stores are also very unique and distinctive. The appearance of the Apple store is very appealing; no matter which Apple store you’re visiting you will always be able to identify an Apple store. What I noticed on my visit is that Apple has been successful due to the exceptional products, exclusivity services and calibers of the staff, all these factors collectively determine its popularity. All Apple stores in NYC are conveniently located, none being more than 3 blocks from a train stop and also in high traffic areas. Apple Store, Fifth Avenue, is open 24 hours a day, 365 days. Recently when you inter the store, the first thing is the new eye catching iPhone posters, which are displayed on the walls.

The retailing mix consists of six Ps: the four Ps of the marketing mix (product, place, promotion, and price) plus presentation and personnel.The classification of retail operations can be classified into four stages. These stages are ownership, level of services, product assortment, and price. Apples ownership consists of being private as it operates for the purpose of profit. Basically, The Apple Store is a chain of retail stores owned and operated by Apple Inc., dealing in computers and consumer electronics. The level of services for Apple comes into the category of full-services. The stores offer an excellent level of service, including free workshops, one to one membership service, and the genius bar. The Genius Bar is the name for the in-store tech support provided in retail Apple Stores. The next classification is the product Assortment, Apple has expanded its product assortment over the years, however its beginning in 1976, not only limited its product assortment in breadth, but also depth. Even now Apple has introduced several new products but still the diversification is very limited which make Apple unique and successful. The last classification is Price. Apple doesn't try to compete with PCs directly on price for many motives. First of all lower pricing leads to reduced profits and loss of shareholder value and it also weakens the reputation of the Apple brand.

Apple is also involved in non-store retailing. For consumer’s convenience, Apple has setup an electronic retailing which includes online retailing and the 24-hour, shop-at-home through internet.

Ch. 6 - Consumer Decision Making

In order for the product to be successfully marketed, businesses need to recognize consumer behavior. According to MKTG 5 consumer behavior is “processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and product use.” It basically means that Consumer behavior is the study of when, why, how, and where people do or do not buy product. The five stages of consumer behavior are: problem recognition (perceiving a need), information search (seeking value), alternative evaluation (assessing value), purchase decision (buying value), and post-purchase behavior (value in consumption or use).

It is well understood by Apple consumers that they (anyone who owns an iPod of any generation) can go out and buy an mp3 player for a portion of the price that an iPod cost, but why people purchase Apple products that cost higher price than other manufactures? The first stage of consumer decision making process is consumers recognizing something that they want and don't have. Basically Apple has been successful to charge consumers with hundreds of dollars for their products because they have successfully marketed their product to us (consumers). They have built their image on the bases of high price equals to higher quality products, and they have also gained consumer’s blind trust no matter what products they produce there is always a large segment of people willing to spend money.

After recognizing a need or want of consumers, they will then search for information seeking a good value. For Apple Inc. information inquiries are external and internal. External information is the advertisement and other consumer’s recommendation, fortunately Apple has a well developed reputation and this is mainly because consumers have a positive experience with the pervious products. For internal information, Apple consumers are very loyal. Many people upgrade their iPhones as soon as the next generation is out, example can be seen recently for release of iPhone 5, and people lined up several days before the release to get the product as soon as possible.

Third step is Evaluation of alternatives, after getting reasonable information; the consumer is now ready to make a decision, With Apple being very popular and in a position of being on top in the markets of electronic, their product are viewed as one of a kind knocking off the alternatives when it comes to purchasing a computer, or any other gadgets.

Next in the process is purchase. Fortunately for Apple, people are purchasing a lot of their products.

The last step is Post purchase behavior. This step determines whether the consumer was satisfied or dissatisfied. When a consumer purchases a product, they have high expectation that might encourage them to purchase products in future. When that expectation is not upheld, it means that consumer was not completely satisfied with the product and you as the company may have potentially loss a loyal customer. So far Apple has been extremely successful in following this tradition. Every time new product is released Apple get awfully high sales and this is result of consumer satisfaction.  

Ch. 5 - Developing a Global Vision

Developing a Global Vision

According to the MKTG 5 global marketing is a “marketing that targets markets throughout the world.”  Basically this means that global marketing is a marketing strategy used mainly by multinational companies to sell goods or services internationally.

Apple stores are spread all other the word, throughout the years, staring from 2005 Apples stores have increased substantially. The graph below shoes change in number of stores from 2005 to recent 2012. Recently Apple has 391 stores all over the world.

According to book global vision is “recognizing and reacting to international marketing opportunities, using effective global marketing strategies, and being aware of threats from foreign competitors in all market.” Apple has created a well awareness in the global vision, by providing good customer services and they offer training to workers, to fulfill the best customer services. Apple provides products that are easy to use, more comfortable and advanced than the products available in their country. They also provide their oversea customers with products with their own country language. Since every country follows different cultures, Apple offers accommodates to people globally, with very modern stores, and welcoming. Apple's straightforward and well-known logo has allowed many countries to be able to distinguish and identify the apple logo being Apple Inc. Recently apple has been manufacturing in China mainly because of the cheap labour. But now that Chinese wages are rising and transport costs are rising that is why it is stated that Apple manufacturing might be leaving China. Some of it will be coming back to United States; other parts of manufacturing companies might go to where labour is even cheaper. 

Ch. 4 - The Marketing Environment

Chapter 4 in MKTG5 deals with the external marketing environment, social factors, demographic trends, growing ethnic markets, economic factors, technological factors, political and legal factors, and competitive factors.

Apple has been successful in these last years because of the fresh, imaginative way to think and do its business. Apple has a winning combination of exceptional products, great style and design, great strategy, innovative marketing, sleek and enticing communications. Basically they know how to grab hold of the external marketing environment, such as the target market. According to MKTG5 book target market is “a defined group most likely to buy a firm’s product.”Apples target market includes attracting upper and middle class people; mostly music enthusiasts and fans ages 12-35, also professionals in media and design. They want people that will pay more money for a better computer. Recent example is set by the reveal of new iPhone 5; Apple Inc. has sold over 5 million iPhone 5 Smartphone in the three days since it came out. For iPhone 5 people are willing to pay a premium price for it. Apple’s marketing environment tends to always follow popular technology. For example, as technological advancements take place in the world, so do Apple’s products.

Ch. 3 - Ethics & Social Responsibility

According to the MKTG 5 book “Ethics are the moral principles or values that generally govern the conduct of an individual or a group.” In my opinion ethics are has to do with what my feelings tell me is right or wrong.

Apple Inc. is a large company that is why they need to maintain their image as a good ethical Social responsible. According to Apple they are dedicated to ensuring that working conditions in Apple’s supply chain are safe, workers are treated with respect and dignity, and that manufacturing processes are environmentally responsible. But “Apple has been frequently cited as the poster child of companies partnering with factories in China that are engaged in unethical and inhumane labor practices”. According to “VentureBeat report” On February 8, 2012 about 250,000 customers signed a petition that why Apple is using exploitative conditions, low pay, dangerous working conditions, and worker suicides at Apple’s Chinese supplier Foxconn to assemble their products such as the new iPhone5. Petitioners asked Apple to make the iPhone 5 its first product produced under entirely ethical working conditions. Now in September 2012, in response, more than 200,000 members of the SumOfUs.org community took action and called for Apple to take responsibility for improving working conditions in its Chinese supply chain. However, Independent reports, found that working conditions continue to get worse. Their responsibility is not only for their employees but also for the consumers and the community. They need to keep the environment and the people safe.

Ch. 2 - Strategic Planning for Competitive Advantage

Strategic Planning for Competitive Advantage

 

According to the book, MKTG 5, Strategic planning can be defined as the "process of creating and maintaining a fit between the organization's objectives and resources and the evolving market opportunities," and a company's competitive advantage are the factors that cause customers to buy their products and not the competition's.

For any company marketing plan is very important. According to the book, MKTG 5, marketing plan is "a written document that acts as a guidebook of marketing activities for the marketing managers". Marketing plan includes, Situational Analysis, SWOT Analysis and Marketing Objectives.

Steve Jobs, CEO of Apple, has been a vital part of the company's strategic planning. Apple has been very successful in these last years because of the fresh, imaginative way to think and do its business: a winning combination of excellent products, great style and design, great strategy, innovative marketing, sleek and desirable communications. Apples strategic planning include successful marketing objective. The objectives of Apple Inc. are to maximize profit and expand their sales to customers who have not yet own any Apple’s products. And to be the dominant high-tech brand in the whole world. They also want create products that will be useful, manageable, sleek and that will appeal to consumers all over the world, with a special focus on developed countries like Canada and the US, Europe, and the populous Asian countries like China, Japan, India and South Korea.

A company’s competitive advantage is when a firm has an advantage over its competitors, allowing it to gain greater sales margins and retain more customers than its competition.

       i.          One competitive advantage of Apple is the multiple Products That Integrate as One. The iPhone is obviously unique on its own qualities, a touch-screen, app-based product that clearly has advantages over the clunker, more dated Blackberry made by Research in Motion.

     ii.          Secondly Apple is also set separately from its competition by its combination of hardware and software, by the content gate-keeper strategy embodied in iTunes, and by their successful retail strategy.

SWOT Analysis (strengths, weaknesses, opportunities, and threats) for Apple.

Strengths:

1. Apple is the founder of advanced and high-tech quality products like iPod, iPhone, Ipad and Mac.

2. It has an internationally recognized brand name.

3. Strong existence in education sector.

4. It gained large segment of devoted customers of “Apple culture”.

5. Apple has Strong Research & Development Department.

6. It retail stores provide the eye-catching products and experience of Apple’s software.

Weaknesses:

1. The new Apple TV just got a small upgrade, in the form of live video streaming for MLB and NBA games

2. The loss of Steve Jobs the founder of Apple.

3. Failure of two notable products namely Mac Mini Apple TV.

Opportunities:

1. New technologies and strategic deals offer opportunities for Apple.

2. Growing market of “Green” and energy efficient.

3. Good relationship through joint venture with other big companies’ pair to bring out new “successes”.

5. Growing demand of online music and other applications like cloud based services.

Threats:

1. Shares of Apple have increased over $100, or close to 25%, just in 2012 alone. Yet it’s only good enough to rank it 45th in the S&P 500.

2. Expensive products as compared to other competitors such as Dell, Nokia, Microsoft.

3. Competition in technology with other vast PC industries like Dell, HP, Nokia, Samsung, HTC and Android.