An overview
The businesses that offer high-quality and recognizable products often prefer to open their own stores, instead of relying on the services of third-party retailers. To a great extent, Apple has also adopted this strategy because in this way, the company can significantly improve customers’ shopping experiences. To a great extent, this policy proved to be very successful. For instance, in 2008, Apple generated $ 6.3 through these sales outlets (Ramaswamy and Gouillart 48).
The management intends to open new stores outside the United States, because in this way, they can establish better relations with their clients (Ramaswamy and Gouillart 48). One should also note that many businesses attempt to enter emerging markets of developing countries that benefited from the participation in the global economy. This argument is relevant if one speaks about China, India, and various Latin American countries. Many people living in these states have been able to achieve prosperity and their purchasing power has increased significantly.
Overall, this proposal is aimed at showing how the company can improve its marketing strategy. Much attention will be paid to the opening of Apple stores in such countries, especially in the most developed metropolitan areas. This plan will demonstrate how the management can implement this strategy and why it will be beneficial for the company in the long term. These are the main issues that should be examined in greater detail.
A problem analysis
It should be noted that the majority of Apple stores are located in the United States, Canada, Australia, European countries, Japan, and China. It seems that the company does not sufficiently explore emerging markets. In developing countries, there are many cities that can be viewed as the potential markets for Apple product. For instance, it is possible to mention that in such a country as Brazil, there is only one Apple Store (Apple, Inc). This sales outlet is located in Rio de Janeiro. However, there are other urban areas in Brazil. For instance, one can mention such a city as São Paulo that has the population of about 11.253,503 people (Encyclopedia Britannica, Inc.555).
Moreover, São Paulo is one of the most developed cities in Brazil, and many of its residents can afford the products offered by Apple. This example is important because it demonstrates that Apple does not sufficiently target this market. Admittedly, Latin America cannot be compared to the United States, Europe or Asia in terms of potential revenue. Furthermore, this region is adversely affected by economic inequality. Nevertheless, there are many potential buyers of Apple products. In particular, the management can target prosperous people aged between 25 and 35 since many of them have been able to benefit from the development of the global economy.
One should note that the large metropolitan areas of Brazil can offer opportunities even for those businesses that sell luxury goods. In turn, the management of Apple should not neglect this market because their products are much more affordable. The management should address this issue; otherwise other businesses such as Nokia and Samsung can fill this niche. In turn, Apple will find it more difficult to compete in this market. These are the main elements of the problem. In this case, the main issue is that this corporation does not take full advantage of existing opportunities. In the long term, this limitation can hinder the financial performance of this business. This is one of the pitfalls that should be avoided.
Proposal specifics
To a great extent, this proposal incorporates the strategy which has already benefited Apple. In particular, one should speak about the opening of brand stores in large urban areas. The company should open a new sales outlet in such a city as São Paulo. This store can be located in such districts of this city as Vila Olímpia or Brooklin Novo. These neighborhoods are of great interest to foreign companies that want to operate in Brazil. Overall, this approach can promote the brand of this corporation in this city as well as entire Brazil.
It should be mentioned that this metropolitan area attracts thousands of people from other parts of the country. It is based on the core strengths of Apple; in particular, one should speak about brand image, high differentiation of its products, and business reputation. In turn, these qualities can appeal to potential buyers living in metropolitan areas such as São Paulo. These are the main elements of the proposal.
Admittedly, it is possible to say that the potential buyers can purchase Apple products online or through the large retailers. To a great extent, this approach enables the company to reduce the costs of marketing and distribution. However, this policy does not strengthen the customers’ loyalty because they do not have unique purchasing experiences that Apple stores can offer them. These sales outlets can actually increase the attractiveness of Apple products. In contrast, the proposed solution can help the company establish better relations with potential buyers who can better see what kind of benefits Apple can offer. So, in this case, one should also speak about intangible benefits that cannot be measured in a quantitative way. These are the main advantages of the proposed solution.
Budget
It is important to determine the costs required for the implementation of this project. The expenditures needed for opening an Apple store range from $8.5 and $10 million (McMillan). These costs will be required for buying the premises, their interior and exterior design. Additionally, these expenses will be required for constructing warehouses and managing inventory. Nevertheless, one should keep in mind that the average revenues derived through one Apple Stores equals $ 9.9 million on the annual basis. Therefore, this investment can be justified in the long term. In the future, such projects can be replicated in other urban areas of Brazil.
Conclusion
On the whole, these examples indicate that Apple should pay more attention to the emerging markets. Brazil is one of the countries that can offer new opportunities for this corporation. By opening a new store in the largest metropolitan area of Brazil, Apple can strengthen its competitive position in the country. This plan can be important for increasing the number of potential buyers. However, the main advantage of this proposal is that it can help the management to form a positive image of the company. Therefore, this proposal can be useful for elaborating the marketing strategies of Apple. This plan involves the main strengths of this organization; in particular, one should speak about its brand image and the quality of its products that can appeal to various users. These are the main aspects that can be distinguished.
Works Cited
Apple, Inc. “Apple Store Locations.” Apple.com. 2014. Web.
Encyclopedia Britannica, Inc. Britannica Book of the Year 2013. London: Encyclopaedia Britannica, Inc., 2013. Print.
McMillan, Graeme. “How Much Does an Apple Store Cost? (Hint: A Lot)”Time. 2014. Web.
Ramaswamy, Venkat, and Francis Gouillart. The Power of Co-Creation: Build It with Them to Boost Growth, Productivity, and Profits. New York: Simon and Schuster, 2010. Print.