Assignment B: Marketing Plan
Apple is one of the most famous companies in the market of the smartphone. Through its iPhone product, the firm has become one of the prominent firms in the current technological environment. The enormous impacts in the contemporary industry of smartphones make iPhone the bestselling product of the firm. By taking into account the considerable demands in the markets, the recently launched iPhone 11 Pro by the firm has been critically highlighted in the overall report. The report has been included in developing a suitable marketing plan for iPhone 11 Pro for gaining the validity of the marketing procedures. It is considered that the recently launched innovative product of Apple has set a significant trend in the smartphone markets for providing a major competitive effect on its competitors such as Samsung and OnePlus. This specific fact leads the report to examine the prospective marketing criteria and strategies supporting the launching of iPhone11 Pro in the target market.
Part I: Product Service Identification
1.1. Description of the Company
Apple Incorporation is a multinational technology firm based in the USA and was established by Steve Jobs, Ronald Wayne, and Steve Wozniak in the year 1976 (Apple, 2020). The leading products of the firm consist of iPhone, iPod, iPad and Macintosh. Recently, the firm has launched the latest version of the iPhone, iPhone 11 Pro.
1.2. Organization Structure
The firm has a hierarchical organization structure with remarkable divisional features as well as the weak functional matrix. The divisional features imply the grouping based on products in the firm like for macOS and iOS. The weakened functional pattern includes the interdivisional collaborations preserved by the hierarchy.
1.3 Benefits of the Product
The product to be offered is the latest version of the iPhone, iPhone 11 Pro. The superior display, the slightly more water resistance, the marginally faster cell connectivity and the telephoto lens of the iPhone 11 Pro are the benefits of the product. The product has a triple camera including Telephoto, Ultra-Wide and Wide camera. The life of the battery of this product lasts up to five hours more than the previous version of the iPhones. It also has a new Super Retina XDR OLED display along with A13 Bionic chip with a third-generation Neural Engine, a spatial audio playback, an Apple U1 chip, an improved Face ID system and a low light photo mode.
2. Situational Analysis
The product is a complete package that implies business by the company and offers the users improved performance and quality for the bucks. This product offers such experiences which mot many smartphones have provided in the current age. It is undoubtedly the best iPhone ever made by Apple. The users of the previous version of the iPhones may notice the subtle difference between the last version of the iPhones and this version of the iPhone. In terms of OS upgrades and privacy, these products provide reliable as well as far better experience to the users.
2.1 Market Summary
Since the launch of the iPhone 11 Pro that is enjoying high sales and robust popularity, the firm has seen a sharp growth in terms of market capitalization. The product has been considered as the best ever product of the firm due to its processing speeds, better cameras, as well as its other enhanced features (Mickalowski, Mickelson & Keltgen, 2018). The sales of the iPhones were weaker last year, but this year, Apple has been enjoying higher sales due to the intense demands of the product in the market. The buyers’ reviews have shown that they are highly satisfied irrespective of the old clients upgrading their phones or first-time buyers.
2.2 SWOT Analysis
Strengths – The superior display, the slightly more water resistance, the marginally faster cell connectivity, and the telephoto lens of the iPhone 11 Pro are the strengths of the product.
Weaknesses – The products are highly expensive in comparison to other smartphones offering almost the same type of features, satisfying only the needs of the higher-end customers.
Opportunities – The leasing opportunities of the products is the high rate of growth of the segment of smartphones, higher preferences for innovative smartphones among the buyers and enhance customer purchasing potential.
Threats – The growing competition from Samsung and OnePlus and the changing laws for the internet in the smartphones are the leading threats for the product.
2.3 Direct and Indirect Competition
The leading competitors of the new product are OnePlus 7 Pro, Google Pixel 3 XL, Google Pixel 4, and Samsung Galaxy Note 10+. While the cost of iPhone 11 Pro is $999, the price of OnePlus 7 Pro, Google Pixel 3 XL, Google Pixel 4 and Samsung Galaxy Note 10+ is $699, $899, $799 and $1,099 respectively (Yun, Lee & Aoshima, 2019). Moreover, the new product of Apple have three cameras on the back which other smartphones does not have, and it makes Apple’s product, the leader of the current smartphone markets.
Part II: Marketing Strategy
For the newly launched product, the mission of the company is as follows:
- To bring the best user experience to its consumers
- To enhance the ability to retain and attract customers
- To focus on innovation
- To control the primary technologies based on the product
- To help technology giant return to expansion
- To support the huge collection of services and products
3.2 Marketing Objectives
To promote the product within the market, the marketing objective of the firm is given below:
- To ensure the integrity of the business procedure
- To ensure compliance of the product
- To increase sales, profits and shareholder wealth
- To develop a community of consumers or users
- To understand the needs and expectations of customers
3.3 Financial Objectives
The financial objectives of the firm are given below:
- To increase sales, revenue and market share
- To lower the cost of the product to strengthen relationships with suppliers
- To focus towards bottom-line earnings and profit margins
- To enhance financial sustainability in the marketplace
- To keep income-level consistent
- To gather outstanding debts
3.4 Target Markets
The product is highly targeted at professional photographers and videographers in urban areas under the age group of 22-50 years for both males and females, which determines that the company is looking forward to adopting niche markets. It aims to increase the sale of the iPhone due to its decrease as the international shipments industry-wide. The company also aimed at targeting creative professionals who specialize in editing video and shooting. Such individuals will get huge benefits after purchasing this product as it comes with unique features (Venkatesh, 2019). Moreover, it created a pricey phone to target niche enthusiasts and audiences within the market. The company also targets the audience who likes to upgrade their phone every two years with the aim of buying phones that possess unique features.
Apple is positioning the iPhone 11 as the new flagship Pro Max, iPhone 11 Pro, and iPhone as the professional-grade models that aimed to target power users. Rather than positioning the phone as an affordable version of the flagship iPhone, it feels like a flagship iPhone. The Pro models are geared towards individuals who utilize their phones for better OLED screen and professional photography. The positioning is done by taking marketing efforts through advertising and promotion. In order to enhance positioning, it focused on emotional branding that helps in understanding the needs and expectations of consumers (Samiee & Chirapanda, 2019).
3.6 Marketing program
Depending upon the launch of a new product, the pricing strategy of Apple is based on the skimming method, which means pricing the phone at a high price to gain huge profit. This strategy is followed at the time of the introduction stage of the product (Wagner & Boatright, 2019).
In terms of distribution strategy, the company used various channels like direct or semi-direct sales for a particular product. With the help of this strategy, the company is able to maximize its customized selling, minimize channel cost and increase market coverage.
Apple used advertising as a strategy to promote its product to its target market. It used a social media platform for promoting the product by posting useful content and images regarding the phone (De Pelsmacker, Van Tilburg & Holthof, 2018). It also used the strategy of email marketing to promote the product to the target audience.
3.7 Marketing research
While launching the product, the company utilized marketing research to improve the quality of the product by obtaining feedback from customers. The company maintained a strong and positive relationship with consumers by keeping them up to date with the newly launched product and informing those regarding possible updates. It helped the company to make relevant decisions and stay organized as well as meet the tasks and deadlines (Varshney & Sharma, 2018). The organization used marketing research to analyze their competitors and implement strategies to gain competitive advantages by remaining ahead from its competitors.
Apple. (2020). Apple. Retrieved 20 January 2020, from https://www.apple.com/
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Mickalowski, K., Mickelson, M., & Keltgen, J. (2018). Apple’s iPhone launch: A case study in effective marketing. The Business Review, 9(2), 283-288.
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Part III: Marketing Management Strategy
The financial aspect of a particular company includes various ratios that determine whether the business has gained profit and acknowledge the viability of the business ideas. In order to determine the financial aspect of Apple, a description of break-even analysis, sales forecast, expense forecast and expense forecast will be discussed in detail based on the launch of the new product iPhone 11 Pro. This will help in determining the financial management of the company’s financial aspects and evaluating the future performance of the business (Meredith, 2016).
4.1 Break-even analysis
For the newly launched phone the break-even analysis is as follows,
The wholesale revenue is estimated to be $500 for every phone, along with a fixed cost of $50 million and a variable cost of $250 million. Depending on these numbers, the break-even calculation will be $50 million that is divided by $500 minus $250 (Asseraf, Lages & Shoham, 2019). This equals a total of 20,000 units sold. Hence, the company will break-even when they sell 200,000 iPhones.
4.2 Sales Forecast
Based on the sales forecast, it is seen that the company have a median target of 295.50, with a low estimate of 150 and a high estimate of 375. Depending upon the sale of the product, the earnings per share is estimated to be $4.53, and the company experienced a sale of $88.3 billion. With the launch of the new iPhone, the firm has anticipated an economic first-quarter revenue by beating the estimation of the analysts (Chopra, 2017). However, it has been analyzed that the gains were limited with an increase in market share. As a result, the net income of the company is around #13.7 billion, with a profit of $2.84 and a revenue of around $63 billion.
4.3 Expenses Forecast
The expense forecast of Apple shows that with the launch of the new iPhone Apple’s expenditures on research and development are estimated to be 15.99 billion U.S. dollars. As per the results of Apple’s fiscal fourth quarter, the company experienced a sale of $64 billion iPhone (Smyth, Duryan & Kusuma, 2019).
The marketing plan related to the latest product of Apple needs to highlight the contemporary adaptability as well as uniqueness. It must measure the marketing activities by judging the overall capacity for informing the buyers of the reasons for choosing the product over other current products in the markets. It is obligatory by the firm to control the exchange of messages of marketing towards the target audiences so that the firm could recognize the likes and dislikes of the target market (Więcek-Janka, Papierz, Kornecka & Nitka, 2017). The marketing factors connected with the new iPhone have to give adequate influence over the technology purchasing decisions of the consumers from the target market.
Apple will leverage its competitive edge of technological features and purchasing decisions of the consumers in the latest product of the firm for helping it to gain the rapidly gain shares of the market. The firm will develop an integrated marketing communication tactics and take actions for the appropriate implementation (Bakri, 2019). For implementing the tactics effectively, the management of the firm has to carry on the primary responsibilities. It would include the implementation of the marketing strategy for the product.
5.2 Contingency Planning
A contingency plan allows a firm to achieve its organizational goals and start serving products or services to its customers. It is seen that in order to launch the new product that is iPhone 11 Pro, the company used a contingency plan that involved a huge amount of planning and practice. It allowed the firm to implement a practical and extensive plan by using real-life drills. It also helped the company to execute its business operations and launch the product by considering goals, operational, and ethical requirements (Iliev, 2019). At the time of planning to launch the product, the company examined the performance of the employees and motivated them to improve their performance. Thus, it has been analyzed that implementing a contingency plan helped the company to launch the product successfully within the market and gain a huge amount of profit.
Part IV: Modifications of the Sections
The primary motive of Apple is to improve the profits of the company in a short time. By launching the latest product iPhone 11 Pro in both the international and national markets, the firm is expecting a kickass growth within the firm. The firm can involve a huge customer base by adjusting its pricing strategy (Huimin & Hernandez, 2016). Moreover, the firm can also include efficient promotional platforms such as word of mouth, social media, newspaper advertisements, digital media advertisements. The post-sales services can be another vital aspect of the organization. Hence, the organization has to increase its service centers throughout the world to improve its sales facilities.
The product identification is easy as compared to other competitors as the company usually releases limited products in a year. The iPhone 11 Pro was launched with few similar devices; thus, identification of the product is not an issue for the company. It will, however, assist in improving product traceability, which requires identification labels of products. Product identification is important for the company as there is always the threat of counterfeiting the products and as the product is famous, it offers more of a reason to players in the market to counterfeit it. In order to ensure that the product is able to remain solely and without any counterfeiting, product identification is necessary and this is done through brand protection and various other information labels.
While the company has its environment that binds its products and services, which is a strength to the company as compared to competitors such as Samsung or OnePlus, where the operating system is from Google and hardware of the respective company. This allows Apple Inc. to gain a competitive advantage over the competition easily. However, this comes with heavy pricing for the products. The iPhone 11 pro is the costliest phone from the company that is not only costly among its similar counterparts from the same company but also from competitors’. This means that only the loyal consumers who are able to spend that hefty price on a phone and want new technology in their hands pay for it.
On the other hand, the individuals who are loyal to the brand but are unable to pay that hefty price on a yearly basis to ensure that they have the latest technologically advanced device with them do not go for it. The situation for the company is that it should focus on reducing the price of the devices. Even if the cost reduction is very less than the competition, it will do the work for the company as in other areas, and the company is already ahead than the competitors.
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Bakri, M. (2019). From Traditional to Digital Environment: An Analysis of the Evolution of Business Models and New Marketing Strategies. Management Studies and Economic Systems, 4(3), 225-240.
Chopra, K. N. (2017). Analysis of the Mathematical Modeling and Simulation of Advanced Marketing in Commerce. Journal of Internet Banking and Commerce, 22(3), 1-9.
Huimin, M., & Hernandez, J. A. (2016). Price skimming on a successful marketing strategy: study of iPad launching as Apple’s innovative product. In Proceedings of the 8th International Conference on Innovation & Management, 389-393.
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Smyth, H., Duryan, M., & Kusuma, I. (2019). Service design for marketing in construction: Tactical implementation in the “business development management”. Built Environment Project and Asset Management, 9(1), 87-99.
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