Executive Summary
Apple is the only iPhone merchandises-manufacturing company that enjoyed a lot of profit after the development and launch of the Apple iPhone 4 in June 2007. The iPhone replaced the iPod (portable digital audio player), which was introduced in the year 2001.
In line with Luther (5, 2011), Apple company was successful on its marketing and sales plans of iPhone considering the amount of sales for the iPhone units made within a span six years. Apple failure concerns the product advertisement procedures. The company involves a great deal of enigma during the product lunches, since most of the introduced products are never available for willing buyers.
People are often forced to line up at the company’s main stores or seek similar/competing products from other potential produces. Currently the Apple iPhone 4 is among the favourable smart phones in the market and therefore the company need to strategize on ways of enticing clients and thus remain within a completive edge. Apple has already captured attention of its fan base as evident from the satisfactory nature of customers, but still need to enforce measures of meeting demands.
Background
This report addresses failure that relates to marketing plans. Apple Company has a strong and well-known trade name/mark and users are at ease buying and using its products due to assured quality. However, Apple Company faces various challenges concerning marketing management strategy and inability to balance the products demands and supply.
According to Pride and Ferrell (284, 2010a), one of the most serious mistake that Apple did concerned their iPhone 4 marketing strategy in Europe, were the team underestimated the huge unexploited markets. There were chances for making extra revenue if it had better marketing and distribution strategies in place.
Current Market Mix Plan for iPhone 4
According to Pride and Ferrell (284, 2010a), one of the most serious mistake that Apple did concerning their iPhone 4 marketing strategy in Europe, was to underestimate the huge unexploited markets. There were chances for making extra revenue if the company had better marketing and distribution strategies in place.
The current Apple’s marketing mix plan is to set pace for potential clients to order and purchase iPhones. Pride and Ferrell (284, 2010b), regard the strategy as the best for selling cell phones globally. Apple regards the iPhone as the next generation IPod.
The biggest reason why the iPhone 4 is able to sell higher than other cell phones globally is due to its physical and multimedia ability to support numerous applications, which are limited on other handsets, however the company fails to notice that other potential competitors are also coming up quite fast.
The Apple Corporation markets the iPhone in a strategic and organized manner that leaves consumers asking for more. The common method the Corporation uses is Television and internet advertising, which makes majority of its potential clients access the latest news and information about the Company. Television does not limit the age and therefore kids are included in this advertising surrounding.
The Apple Website also helps in marketing other updated product since texts, graphics and videos are posted for the subscribers to make comments and purchase the related products. Most customers order their products online and pay through Smart or Visa Cards. According to Magder, this form of E-commerce has seen the company grow immensely, since consumers are able to trust the company’s business transactions (1, 2010).
The transactions are also free of any disagreements or business encounters. Furthermore, this has saved customers time, since they only need to log on to the website and purchase instead of travelling to the Company’s headquarters to make price quotations and order for new products (Magder, 1, 2010).
The Apple Marketing director makes sure that press conferencing is carried out after a certain period, to update consumers on the company’s latest offers. Monthly newsletters are also supplied to community organizations, schools and governmental institutions for advertisement purposes.
After a certain period, the Apple Company carries out a product questionnaire among different countries, towns and villages. Consumers are asked questions about the products, in which case they are supposed to indicate their satisfaction and indicate any advancement they would want done on the products (Magder, 1, 2010).
The recent survey showed that majority of iPhone users originate from United States, which houses many hardware and software manufacturing companies Pride and Ferrell (27, 2010c). According to Magder, more than 20% users are from United States and this provides many opportunities from expansion through proper global marketing strategies (1, 2010).
Currently, having many customers access Apple’s site and follow the company’s marketing scheme, the marketing anecdotes from other competitive companies reduces since every consumer gets the real news in real-time.
The iPhone website acts as a one-on-one means of interaction between employees and clients, since it offers help on various areas for those having problems with their iPhones. Customers can also post questions and in return, the technical staffs reply to their queries.
This forum advertises and eventually ends up assisting the user. Apart from helping, the company website provides tricks and shortcuts for users, when accessing applications with the iPhone 4, such as tips on watching videos, how to expand the screen and much more (Magder, 1, 2010).
Apples’ Competitive Position
Marketers’ targets of Apple iPhone 4 were to attract youth of between 20 and 35 years. This was ironical since 48% of these youths do not have the iPhone on analysis of current statistics (Pearson, 87, 2011). Marketers made sure that commercials were simple and attractive, in order to attract more customers.
On a survey that was conducted one month prior to the release of Apple iPhone 4, 72 % of men and 28 % of women were likely to purchase the device. Contrary, many people did not know the iPhone pretty well to consider worthiness of such a purchase at a price of $499.
However, Apple iPhone 4 allowed users to download top applications for their cell phones, thus earning the company a lot of income. Currently, Apple iPhone 4 is the only Smart phone that the company seem to boast about due the over 25,000 applications of the device (Pearson, 87, 2011).
The release price for Apple Iphone4 was $599. The company set the price up because they knew there was no competition between them and other potential rivals. This saw hundreds of thousands users purchase the device. Three months later, the price was reduced to $399 and millions users rushed to make their purchases. Year later, the price was further reduced to $199, 66% less than the release price.
Apple stated that the price reduction was a marketing strategy to attract more people, but analysts said that this came for the reason that there were low sales than the company anticipated (Wooldridge and Schneider, 8, 2010).
Many products have been known to reduce their price drastically after a release a reduction of over $400 within a life span of less than two years is huge. $599 was also a very high price, regardless of the features that the phone carries. This was a clear indication of poor planning and marketing solutions implemented by the firm. The prospective of Apple Company is thus highly compromised by its marketing strategies.
Validity of Marketing Strategy for Apple iPhone 4
According to Hutt and Speh (22, 2009) the Apple iPhone was able to create an immediate enthusiasm among consumers upon it launch, since everyone considered this as a triumph over competitors due to the uniqueness of the design and flexibility. It emerged to be a cool and a must-have gadget even before the first unit could be available in major stores.
On the other hand, Hutt and Speh (22, 2009) argue that for a product to sell successfully, it has to get to the right customers, at the right time and price. Failure to reach a given market projections by firms are due to poor products’ innovation as a result of meagre quality that fails to meet loyal customer’s demands.
The launch of Apple’s supper iPhone 4 therefore demonstrated the company’s failure to meet demands. The development of new products such as iPhone 4 also depends highly on the marketing strategy.
Their marketing execution and development strategies enable Apple to excel in supply chain management. It has been awarded the top rank among major competitors such as Nokia, IBM, Cisco, Nike, among others. The company presents a new era of performing marketing activities, based on design, content or ideas.
The iPhone 4 was awarded the top position due to its inspirational software interface, brilliant industrial designs and its unique digital nature. Apple’s final strategy for iPhone 4 was only to meet rapid demands of its clients.
Conclusion
The only time people lined up was at concerts and places where they needed to get tickets. Upon its launch, the Apple’s iPhone 4 caused people to line up at then Apple store to experience the launch and make their purchases. The company is able to create great hype around its products but eventually fails to meet the demand the revel generates.
During the iPhone 4 launch, people demands were put on hold for long in majority of the stores. Today, Apple needs to enforce better marketing plans/strategies. There is need for a fresh start because the iPhone sector is highly overcrowded and people are often switching to similar devices from competing firms.
According to Magder (1, 2011), most people will argue that it is not right to advertise a product that has a lot of mystique since it is not available for the average buyer.
It is also arguable that such a marketing strategy may fail to work well since a willing buyer often seek the gadget from other similar manufactures instead of lining up for hours outside the company’s main store. Apple iPhone 4 remains the top, best selling smart phone to date. However, management of supply and demand is a crucial aspect that the firm fail to implement in their daily undertakings.
Recommendations
The marketing manager and team must learn that clients already trust Apple Company and are ready or willing to purchase any of their newly launches product. Major support by potential client was evident during the iPhone launch when clients lined up at the main store to vie and buy the iPhone 4 (Magder 1, 2011).
Ensuring availability of new products before official launch is therefore very important. Clients should not experience delays to get hold of new products.
According to Luther (5, 2011), the company marketing mix strategy also requires better and more innovative ways of enhancing the balance between supply and demand. If the company is able to entice users to buying a new product, then this product should first be available in major stores, before the launch.
The marketing and inventory managers must understand that company’s failure to provide as per demand causes dissatisfaction as evident when there were huge delays on acquisition of iPhone 4 upon it launches (Magder 1, 2011).
Various technological companies are competing to produce the smartest devices at the least cost possible. This is a sales strategy that marketing and general managers must also consider during their launches and marketing. The need to often upgrade devices for instance by advancing storage sizes, increasing processing speeds, develop more applications and add new features is important.
However, marketing managers must ensure that prices remain constant and viable as an excellent sales management strategy. The company failure to manage pricing is obvious since it introduces a very high price of $599 upon the device launch but reduces the pricing drastically to enhance sales (Magder 1, 2011).
According to Pride and Ferrell (284, 2010b), Apple Company’s executives need to understand that the firm collaboration with various influential international companies is important.
Through collaboration, the firm is able to flood the computing markets with latest models of devices such as iPhones. This strategy can assist in management of production, marketing and distribution costs and equally enhance increase of revenue since it would be a long-term agreement.
Appendices
IPhone 4 has a small, slim and portable characteristic, which makes it ideal for both in and out door uses. The Apple manufacturers designed iPhone 4 to Multitask, as it is the case of a computer.
Most clients are therefore purchasing the iPhone today as a communication device, information manager, and entertainment unit, since it facilitates various features all at the same time. The gadget enables users to listen to music, watch video, view photos, make conference calls, check e-mails, in addition to browse the web or view web maps. The illustration below shows a sample of the gadget.
The new mobile phone products from Apple over the years have been outstanding and very impressive to most potential buyers.
The company launched the iPhone in 2007 and this was a stepping block for Apple’s dealings in the already mature markets, which were highly saturated with willing users. According to most marketing analysts including Ferrell and Hartline (472, 2010), the iPhone 4 is considered a revolutionary product that places Apple milestones ahead of its competitors.
During the launch, the company considered iPhone as a gadget that incorporates the mobile phone and laptop technology into a single interface, thus terming it as a Smartphone. The iPhone 4 developed from the earlier 2008 second-generation iPhone model and the 2009 third generation iPhone (iPhone 3G) model.
References
Ferrell, O. C. and Hartline M. (2010). Marketing Strategy. Mason, OH: Cengage Learning.
Hutt, M. and Speh T. (2009). Business marketing management: B2B. (Tenth Ed). Mason, OH: South-Western Cengage Learning.
Luther, W. M. (2011). The Marketing Plan: How to Prepare and Implement It. (Fourth Ed). New York, NY: AMACOM Div American Mgmt Assn.
Magder, J. (2010 August 10) iPhone4: Brilliant marketing, or bad supply management? Web.
Pearson, T. (2011). The Old Rules of Marketing are Dead: 6 New Rules to Reinvent Your Brand and Reignite Your Business. New York, NY: McGraw-Hill Professional.
Pride, W. and Ferrell O. C. (2010a). Foundations of Marketing. (Fourth Ed). Mason, OH: South-Western Cengage Learning.
Pride, W. M. and Ferrell, O. C. (2010b). Marketing. Mason, OH: Cengage Learning.
Pride, W. M. and Ferrell, O. C. (2010c). Marketing Express. Mason, OH: Cengage Learning.
Wooldridge, D. and Schneider M. (2010). The Business of IPhone App Development: Making and Marketing Apps that Succeed. New York, NY: Apress