Executive summary
Apple as a brand has made itself a strong reputation. The brand is considered among the most powerful among other consumer electronics and communication devices, and is the leading brand in portable and online music industry. Its success is attributed to customer loyalty, technology, a healthy financial position, expertise, and a good market share. The brand has to function with the marketing communication framework to maintain sustainable leadership in the market. It utilizes advertisements, public relations, direct marketing and the internet to communicate to its customers. Other than a few advertisement and environmental challenges, it is a brand that is expected to see more success, considering the upcoming generation has been heavily exposed to technology, the internet and digital experiences, all which the Apple brand offers.
Introduction
“Apple Inc. is an American based multinational company in the business of designing and selling of computer software, personal computers and consumer electronics, and uses the Apple brand to compete in the now highly competitive market ” (Apple Computer Inc., 2010). The company was established 34 years ago in California and incorporated eleven years later. The brand Apple has enjoyed tremendous success in the industry with its annual sales exceeding $ 42 billions in its last fiscal year (Apple Computer Inc., 2010).
For these reasons, Apple has earned a position as one of the biggest brands in the world and was listed in the 100 most famous brands in 2010. Apple Inc. company was named among the most the most admired company in the Untied States for the year 2009 by the Fortune Magazine. It has also been named the most admirable company in the world for three years consecutively since 2008 by the same magazine. It enjoys a big brand loyalty all over the world especially in the United States. The brand’s latest products and technology innovations are proving a headache for its competitors as they try to keep up with the competition they have brought to the market.
Apple as a brand has had a big success especially after the introduction of its iPod and iPhone. The iPod music player and iTunes online music stores contributes a large percentage of the company’s revenue. It’s digital rights management (DRM) system has ensured that music purchased from iTunes can only be played on Apple’s music players and protected music purchased from other online music stores cannot be played on iPods making it hard for the competitors to take advantage of such innovations (Apple Computer Inc. 2010). The company is currently enjoying a huge market share in the digital music market putting it in a good position in decision-making processes. The brand Apple is experienced in different products such as computers, software products, communication and entertainment devices. The brand is built towards ensuring increased profits, increasing its market share and maintaining its brand loyalty.
Choice of brand
Apple as a brand has made itself a strong reputation. The brand is considered among the most powerful among other consumer electronics and communication devices, and is the leading brand in portable and online music industry. The brand’s success can be measured on the basis of customer loyalty, technology, financial position, expertise, market share among other success indicators. The brand currently enjoys the best technology in the market. Since it has better technology than most of its competitors, it is in a better position to access and analyze information about consumers, competition and several other factors which dictate the markets outcomes. The products’ level of technology give the brand a status symbol which easily intimidates competitors.
Apple brand is a financially stable brand right now, giving it stability and ability to take advantage of new opportunities in the market. The brand has been able to buy off other small brands which have high potential for Apple, and integrated them to its system, to give it fresh and new products every time. Due to its healthy financial status compared to that of its competitors, the company is able to attract the best employees and invest in the best technologies in the market.
Its financial position allows it to not only employ but also retain the best. As a result, it is able to retain quality in its products due the level of professionalism it enjoys. The brand’s big market share and control of the market is also an indicator of its success. It is right now enjoying the biggest market share as a provider of portable music and other digital contents. It is therefore in a position where it can easily influence decisions in the market such as market trends. It also puts it in a better position to handle uncertainties in the market because it is able to predict trends due to its large presence in it.
The legal aspect of the brand allows customers place orders and make payments as per the stores’ requirements. Customers enjoy a one year warranty for computers and some of the consumer products as agreed upon by the company. Apple as a brand is designed in such a way that it allows data protection. Use of passwords for example enables customers protect their information even in the case where they have lost a product.
Apple targets people more than it does markets. The brand targets people with a middle or high incomes, who are willing to spend a little much more for a different and better experience. It targets people who enjoy technology. Their digital and iLife concept has offered the brand the biggest platform in the market. Apple’s clientele includes people who love to play games, shoot digital photos or make videos. As a result, the brand enjoys a bigger clientele from the younger generation. The iPod and online music library attract music enthusiasts, while the advanced technology attracts media and design professionals. The brand’s success is expected to continue on a successful trend, because the upcoming generation has been heavily exposed to technology and the internet (Apple Computer Inc. 2010)
Apple’s branding strategy
Apple Inc.’s products range from the Macintosh personal computers, consumer electronics, the iPod, communication devices and iTunes through its online music store. The company’s strategy is to create innovative and digitally driven products, which easily establishes a relationship with a consumer. A product such as the iPod allows personalized collection of information and music. In so doing, it becomes a very personal product that a customer may not be able to do without.
Apple as a brand has been successful in developing its own personality. By personalizing the products they buy, customers easily develop emotions for their gadgets. The brand’s personality is centered around liberty, passion and imagination. These three aspect translate to what many Apple customers consider a personality. The brand puts a lot of attention on simplicity and many of their products require no special skill to operate.
So far, Apple’s strategy has proven very successful, producing excellent results. The brand has been reporting an upward trend in its financial results since 2006, even in the midst of the recent financial crisis. The brand attracts huge number of customers every time there is a new product for offer. The iPhone, which was released in 2007, sold over 1 million units in its first 3 days in the market (Apple Computer Inc., 2010).
The brand is built in such a way that it easily establishes connections with its users. A connection with consumers can take different forms and can include design, reliability and trust. The most important part of marketing a brand is ensuring that first time users will easily relate with a product and want to try it again. Apple’s products give customers the latest experiences in the market. By constantly upgrading their products, the company can easily keep up with changing consumer preferences and expectations. Apple’s products are designed for and around people. According to Apple Inc. (2010), “The iPod is people driven and is designed to bring an emotional, sensory experience to computing”. The CEO of Apple is quoted as saying “having an iPhone is like having a good friend because the brand is really humanistic, giving a beyond-business relationship to users and creating a cut-like relationship” (Apple Computer Inc., 2010).
Marketing communication for Apple
Apple has to function with the marketing communication framework to maintain sustainable leadership in the market. Traditionally, many business based their marketing on the four Ps, which are product, promotion, place and pricing (Macnamara, 2004). Today, there are new avenues and factors to consider when communicating to consumers. Just like in the past, the main aim of market communication is to inform, persuade and remind customers of a specific product in the market. The strategy is used to increase sales volumes by informing customers of a product and encouraging them to try it.
After establishing new customers, marketing communication is responsible for ensuring that they are retained while new ones are created. “Retaining a customer base is done by reinforcing their purchasing behavior and providing additional information about the brand’s benefits” (Balsmeier and Annita, 1994). Other goals of marketing communication is creating and relating to prospects and other stakeholders. Marketing communication is combined of different options that make it successful. “These options include advertising, sales promotion, public relations, direct marketing, and personal selling” (Balsmeier and Annita, 1994). Each of these options has a special role to play in the process and completes the chain. The internet has today become an important option and strategy for marketing, especially for businesses that target the younger generation.
Integrated marketing communication
For Apple Inc., marketing communication has played an important role in ensuring the brand takes leadership in the market and stays there. The products, pricing and the services they provide, makes them very important to the market today. Apple as a brand has illustrated an integrated marketing communication. This new perspective for Apple has evolved from a realization that advertising and sales are at odds as far as budgets and responsibilities are concerned. Secondly, this concept is from the need to have more market driven communications rather than having those which are market oriented.
Integrated marketing communication has allowed the brand build relationships and excitement. In Apple, customers are not treated as targets but rather, the brand promotes a relationship with them, offering them partnership instead. The brand creates contacts which allow new customers and prospects encounter it through different hosts. By researching and having specific information about consumers and their lifestyles, the brand is able to send tailor made messages through the media and reach specific segments. This way, marketing is more targeting, bears more results and makes financial sense.
Integrated marketing communication is achieved by utilizing data and information, segmenting customers and potential clients. These groups are segmented on the basis of behavior, consumption and lifestyle. In doing this, it is possible for Apple as a brand to establish profitable and stable relationships with its clients and generate coordination between products and consumers. The results are a consistent, clear and maximized benefits of marketing.
Advertising
Apple as a brand is known for expensive advertising budgets. Apple’s advertisement is known for its persuasive and exciting nature. The brand’s biggest strength in the market is understanding its competition and countering competitors’ efforts early enough before they can affect the brand’s share market. One of the areas in which the company has enjoyed overwhelming success is portable music industry. Major competitors in this industry include music download sites, Gmail, blackberry, Hotmail, and alike. Their market shares however do not allow them to influence decisions as much as Apple does. Perhaps this explains Apple’s business deals with big companies in the market such as EMI, Warner and Sony which control over 70% of the world’s music distribution.
Its competitor brands in the software and hardware industry include Microsoft, Dell and HP just to mention a few. Apple however is considered as having one of the best software and hardware technologies in the market and therefore is able to attract more customers. Their iPod touch and iTunes are viewed as a unique advantage for the company which competitors are so far having a hard time overcoming (Apple Computer Inc. 2010). “Its iPod, which is synonymous with digital music players, gives the company an awesome base of users for app developers to target, and the company already boasts more than 6.5 billion apps being downloaded from their online store so far” (Pickton and Broderick, 2005).
Apple uses both traditional and new modes of advertising. It is estimated that the brand’s promotion costs about 10% of the company’s budget on sells and administration, which amounted to $ 3.8 billion in the last financial year (Apple Computer Inc. 2010). Its advertisement avenues include radio and television advertisements, bill boards, written literature, and sponsored programs. Its most expensive sponsorships include that of the America’s Cup organized by New York Yacht Club and the FreeRice, a program which aims at fighting hunger in the world.
Part of advertisement for Apple is top sales and marketing personnel. Quality marketing staff has been essential in sustaining a strong and powerful Apple brand. A company offering products such as Apple must establish a strong and well defined marketing plan to help them achieve their potential. For Apple, the competitive nature of its industry requires that it has a well qualified staff , whose skills are constantly developed.
Public relations
“Public relations is the management of functions that ensure a mutually beneficial relationship between a brand and its customers” (Macnamara, 2004). As opposed to the one way communication in advertisement, public relations involve both the brand and the customers. It is very dependent on feedback from customers. By monitoring feedback, it is able to tell how in touch customers are to a brand. The most primary tool in public relations is publicity, which takes advantage of a brand’s value and its use to disseminate information.
Apple creates publicity through endorsements on the media, media articles and many other mediums whose messages are more likely to attract attention and be convincing to customers. As a result of too many advertisements in the market, consumers are more likely to avoid traditional advertisements. Apple has chosen to venture in new coverages such as community programs, which are new and easily attract attention. Today, consumers are more dependent on a company’s image to make their decisions concerning a brand. For example, consumers will easily trust a brand that is more environmentally friendly and responsible towards the community.
Apple’s environmental reputation had been marred with conflict for a long time with accusations that it promotes non-recyclable hardware components (Apple Computer Inc., 2010). Since then, it has embarked on an environmental campaign that has seen it ranked first among the greenest electronic companies by Climate Counts this year. The Environmental Protection Agency has also applauded the brand for being the most environmentally conscious brand. The brand has taken advantage of its environmental campaigns and used them as an avenue to advertise themselves.
Direct marketing
Direct marketing is considered the oldest marketing practice. It involves direct communication with customers in a way that allows a personal and direct feedback mechanism. In the past, telephones and letters were used to do direct marketing. Apple in the past has utilized these forms of communication with their customers. Today, the brand uses other methods of communication, the most common being the emails and social networks.
One of the strategies commonly utilized by Apple is collecting email addresses. The company then uses them to communicate any new information about the brand to the customers. That way, the mails can be personalized and customers can reply and communicate specific concerns or information. Personalized emails allow Apple’s customers feel appreciated and makes it easy for them to air their complaints about the brand, rather than shopping for new brands anytime they experience challenges. This form of marketing allows the brand follow up on prospects and new customers closely. It is cost effective and can reach billions of people at the same time.
Another avenue for Apple to do direct marketing is through their retail shops. Apple Inc. has stores in more than thirty five states in the United States alone. The stores are usually the best place for its customers to test drive and explore the brand. Here customers are able to test the products and talk to Apple’s experts about any questions or concerns they may have about the products. “The company has put in place such a big number of stores in place to allow fast activation of products, enable professional customer setup and give their customers expert advice about rate plans that best suit them” (Apple Computer Inc., 2010).
Internet marketing
Online advertising is growing at a very first rate today. Apple uses the internet through websites and social networks. By linking Apple’s website with other frequently visited websites, and giving promotion offers at the website, Apple attracts a crowd that the brand can easily communicate with. Establishing on-going communication with its customers such as live chats and instantly replied mails, makes it easier to understand the customers expectations and demands.
By placing a shopping cart on the site, it is easy and convenient for clients to purchase available products conveniently from any part of the world, without the need to go to the shops. It is an avenue for the brand to communicate to its clients all over the world in a more manageable and cost effective way. The social networks have become an important avenue for Apple to market itself today. Social networks’ interactivity is an important advantage, giving Apple an opportunity to access real-time information about the its customers’ preferences.
Conclusion
Building relationships with customers and establishing a strong, healthy and long term bond with the customers is important in ensuring that the products are constantly updated to the customers demands and preferences. Continually updating the customers on the progressive quality of the company’s products and services make them feel valued and appreciated, and it makes it easier for them to air out their complaints.
Apple seems to be mastering the art of ensuring brand loyalty fast and the efforts are paying off. The brand enjoys a healthy market share and has proved to be the best in terms of technology and experience. Using the internet and ensuring quality are among the best tools for Apple, allowing the brand a consistently good market share. The brand enjoys well established and advanced technology that does not disappoint those who are looking for new experiences.
“A mere coordination of messages does not mean a successful integrated marketing communication” (Missa, 2004). It requires that businesses understand their markets and their clients. Understanding competition has enabled Apple stay ahead and maintain a good market share. It is a brand that is expected to see more success, considering the upcoming generation has been heavily exposed to technology, the internet and digital experiences, all which the Apple brand offers.
Recommendations
The Apple brand seems to have everything in place for a brighter and better future. However, it still has areas which need to be addressed if the brand has to stay at the top. The brand tends to put too much focus on certain products. The recent craze about the iPod and the iPhone makes the other products invisible to the larger market. This can be solved by giving each product its own advertisement platform rather than advertising all the products as a brand.
The brand has been associated with negative publicity in the past such as proven allegations that one of its contracted manufactures, responsible for producing iPods in China, has been overworking employees and paying them badly. Such incidents should be dealt with to avoid tainting the brand’s name with a negative image.
The brand is also faced with challenges in its advertisements. Even though it has very professional commercials, the adverts are criticized for giving very little information to the consumer. For example, most of Apple’s commercials don’t give prices for the products and hardly enlist all the available features in the product. The company’s digital rights management doesn’t allow easy sharing of content and this is causing a lot of criticism from both the competitors and customers. This could be a potential threat for the company as it could cause content providers to withdraw if they got better offers. With proper considerations, the company should revise this policy to allow its customers access more content from the competitors’ online stores.
Reference list
Apple Computer Inc., 2010. Apple’s product.
Balsmeier, P. and Annita, H., (1994). Cross-cultural management: An international Journal. Cross-cultural Communication, 1(2), p. 13-21.
Macnamara, J.R., (2004). The crucial role of research in multicultural and cross-cultural communication. Journal of Communication Management, 8(2), p. 332-334.
Missa, F., (2004). Corporate communications. An International Journal, 9(4), p. 331-339.
Pickton, D. and Broderick, A., (2005). Integrated marketing communication. 2nd ed. Harlow: Person Education Limited.