Marketing Research of Apple iPhone Sales Decline: Pricing, Positioning, and Customer Insights Essay

Using Marketing Research to Understand Current and Potential Customers

The recent models in Apple’s iPhone range experienced a significant decline in sales. To overcome declining sales, the company is considering reviewing its pricing policy and lowering prices for the following line of new phone models. Moreover, the difference in the technical characteristics of the models forces buyers to choose more expensive models while ignoring models released in a lower price segment. Marketing research can help the company identify potential customers for models in the middle-price segment.

The Marketing Research Process and Data-Gathering Techniques

Gathering the information about potential customers for the descriptive research will require conducting surveys and observing customer behavior in multiple Apple stores. Information collected through surveys and observations will be used to create a portrait of a potential buyer of a mid-priced segment product (iPhone 14 Plus). The collected information will also indicate the reasons why customers choose more expensive models or competitors’ products.

External Forces Influencing Marketing Planning and Strategy

Over the past few years, the electronics industry has been significantly affected by the economic disruption caused by the COVID-19 pandemic. Many companies were forced to partially suspend production because of supply chain issues. They faced challenges meeting customers’ demands, significantly reducing their profitability (Moon & Shugan, 2022).

In Apple’s case, the decline in sales for new models was also caused by the tension in political relationships between the US and China. China represented a significant part of Apple’s global market sales; with the introduction of economic restrictions on both sides, Apple faced severe losses in global sales. Lastly, as Apple continues implementing innovative sustainability measures within the company and its suppliers, it cannot afford to cut prices to the level of competitors with no existing sustainability strategy.

Customer Relationship Management and Its Strategic Role

Apple’s customer relationship management program is defined through the Apple ID service. The service allows customers to use Apple’s devices and digital services and provides high-quality technical and service support. Furthermore, the service collects information about the customer’s personal devices and preferences to increase the effectiveness of Apple’s ecosystem, allowing the customer to quickly switch and transfer data from one device to another. Therefore, the company can provide personal attention to each client and establish trustful relationships without using many additional resources.

Key Consumer Characteristics Affecting Purchase Decisions

Purchase decisions can often be founded on personal, social, and cultural characteristics. Thus, the customer’s income and social status determine their ability to buy a phone model from the new line. Depending on whether a person needs to save on a purchase, they can choose a more affordable model or pay extra to invest in the device’s expanded functionality and more convenient use. Furthermore, the widespread culture of success may contribute to an individual’s decision to purchase a more expensive model from the device’s range to match the owner’s social status. Lastly, the decision may be based purely on personal preference; for example, the absence of a specific color in stock can force a person to choose another model of a similar color.

Market Positioning and Development of the Positioning Statement

The positioning statement for iPhone 14 and iPhone 14 Plus conveys the idea of the device’s large screen size. The official statement for both models is “big and bigger,” referring to the fact that the new line’s models are significantly larger than earlier models. On the contrary, the official statement for iPhone 14 Pro is “Pro. Beyond,” which lets customers know about the technical superiority of the more expensive model (Apple, 2022).

Further analysis of the products’ positioning shows that the more expensive model can be perceived as a result of groundbreaking technological progress. At the same time, affordable options are the only slightly improved models from last year. Thus, a significant difference in the positioning of the devices could present one of the factors that influenced the low sales of less expensive models.

References

Apple. (2022). iPhone. Web.

Moon, J., & Shugan, S. M. (2022). The profitability of purchase limits during shortages. Journal of Marketing Research, 59(6), 1197-1215. Web.