Brand ANALYSIS

(APPLE INC)

PROFILE OF APPLE INC:

Apple Inc is an American multinational organization selling personal computers, consumer
electronics, computer software and online services. It was founded in 1970s, specifically to sell
personal computers, by Steve Jobs, Steve Wozniak and Ronald Wyne. It was incorporated as
Apple computer, Inc but was renamed later as Apple Inc when its focus towards consumer
electronics increased.
Currently Apples major Hardware Products include Apple TV, iPod, iPad, iPhone and Mac
series and its major Software Products include OS X and iOS operating systems, iTunes media
browser, iLife, iWork and Safari web browser. Its online services include iCloud, iTunes Store
and Apps Store.
PROBLEM STATEMENT:
The reason of this study is to analyze the importance of brand analysis. The study will help us
about the related benefits of brand analysis. The details of the study will help us learn about the
consumers awareness about Apple Inc and how their loyalty has increased towards the brand
and how did Apple became so famous even after facing a lot of difficulties in 1990s .The study
will help us know how Apple has gained its competitive edge. Also, analyzing the importance of
branding will help us about Apples strengths, weaknesses, threats, opportunities by using
SWOT analysis. Whereas 4Ps can be used to find out about the marketing mix that Apple has
been using to become that much popular.

APPLES MISSION STATEMENT:

Apple Computer is committed to protecting the environment, health and safety of our employees,
customers and the global communities where we operate. We recognize that by integrating sound

environmental, health and safety management practices into all aspects of our business, we can
offer technologically innovative products and services while conserving and enhancing recourses
for future generations. Apple strives for continuous improvement in our environmental, health
and safety management systems and in the environmental quality of our products, processes and
services.

APPLES VISION STATEMENT:

Apple is committed to bringing the best personal computing experience to students, educators,
creative professionals and consumers around the world through its innovative hardware, software
and Internet offerings.
Reference Webpage:
www.answers.com/Q/What_is_Apple's_vision_and_mission_statements
GOALS & OBJECTIVES:
Goal:
Our goal, in a nutshell, is to obtain stellar products and services within tight timeframes,
at a cost that represents the best possible value to our customers and shareholders. If that
sounds like a daunting task, its the same one we assign ourselves

Reference Website:
www.apple.com
Objectives:
Apple Inc has got three main objectives:
1. To expand their sales to customers who do not yet own Apples products
2. To provide easy products those provide quality service and enjoyment for customers
3. To become the leading business in the Mobile market.

Reference Webpage:
http://sites.cdnis.edu.hk/students/063628/2011/09/21/apple-objectives/

Major Competitors Of Apple Inc:

Samsung, Microsoft, Dell, HP, Blackberry, Nokia

Motivations of research:
As the competition in the technology industry has increased, it is important to carry out a study
on the importance of using marketing strategies of branding for Apple, to stay at the top of
consumer's mind, to cope up with the changing environment, to gain competitive edge, to make
improvements in future and to achieve goals set by the company.

History Of Apple In:

Apples history started when two friends Steve jobs and Steve Wozniak started building a
computer in their garage and came up with their first computer APPLE I.It was a wooden-made
box with a basic motherboard inside and had 8KB of RAM which was sold for 666$.Later Apple
II was released with color graphics and a floppy disk drive added. It had a 64KB of memory and
also included software called VisiCalc.In 1980 Apple III was released which had 128KB of
RAM and was specifically designed for business purpose but caused a lot of problems and didnt
do well.Apple LISA was released in 1983 and became the first personal computer sold to the
public with GUO but failed commercially due to its high price and limited software function.

In 1984 Apples famous Macintosh was introduced which had strong sales in the beginning but
because of its high price its total consumption was not as desired. It contained Motorolas 68000
CPU and was sold for 2495$.Apple Inc introduced it Macintosh Portables for the first time in
1989 but they too failed in the market as they were quite slow. Later in 1990 & 1991 Apple made
more portable efforts like Macintosh LC & Powerbook100 and they succeeded to gain some
good revenues when Powerbook100 was introduced which establish layout of the laptop
computers.

Decline & Restructuring:

After the Macintosh Portables low success rate, Apple learnt several lessons on what to do
differently. During this time Apple experimented with many other products like cameras,
Portable CD players, Speakers, TV appliances etc but these products were of no help in the
growth and success of Apple. Hence in late 1990s Apple announced to join hands with
Microsoft to release new version of Microsoft office for the Macintosh. In 1997 Apple
introduced the Apple store and new build to order manufacturing strategy. In 1998 new iMac
with Mac OS X was introduced. Then came the iBook, Apples new laptop.

Return to Profitability:
In May 2001 Apple opened more Apple retail stores in Virginia & California. Apple Retail stores
are a platform where potential customers could use products without purchase and Apple has 425
of such retail stores. In the same year Apples blockbuster iPod was introduced which came to be
a huge success. It was a portable digital audio player of which over 100 million units were sold
in the first six years. In 2003 Apple iTunes store was opened which offered online download and
became market leader in online music services. In 2006 Mac book pro and iMac were the first
apple products sold with Intels core Duo and in the same year PowerMac, iBook and
PowerBook were replaced with Mac Pro, Mac Book, Mac Book Pro. At this time Apples
success was at its peak and left Dell behind. June 2007 was the time when Apple introduced its
1st generation of iPhone which runs on Apple IOS. In April 2010 Apple came up with a Tablet
Pc followed by iCloud service in 2011.
Financial analysis:
After Apple introduced its iPod mp3 player, it experienced tremendous increase in its revenue.
Since then the company introduced various electronic products including iPhone, iPad, Mac
computer series and had huge revenue growth, that is, from 5.36 billion (2001) to170.9
billion(2013), 96% increase in 12 years.

Table 1 shows the profitability and growth since 2004 till 2013:
2004 2005
2006
2007 2008
2009 2010
2011
2012
2013
Revenue USD Mil
8,279 13,931 19,315 24,006 32,479 42,905 65,225 108,249 156,508 170,910
Gross Margin %
27.3
29
29
34
34.3
40.1
39.4
40.5
43.9
37.6
Operating Income USD Mil 326 1,650 2,453
4,409 6,275 11,740 18,385 33,790 55,241 48,999
Operating Margin %
3.9
11.8
12.7
18.4
19.3
27.4
28.2
31.2
35.3
28.7
Net Income USD Mil
276 1,335 1,989
3,496 4,834
8,235 14,013 25,922 41,733 37,037

The table shows that Apples revenue increased consistently from 2004 till 2013 and the gross
profit margin has increased from 27.3 to 37.6 that is an increase of about 27%.This tremendous
growth in profitability and margins is definitely because of the brand recognition and customers
trust in Apple Inc. This is ultimately the success of Apples branding strategy and now we will
look into this.
What is branding?
Brand is the unique sign, symbol or word which differentiates its product or services from that of
the competitors A company is recognized because of its brand name and its products and
services are also trusted because of this brand name.

Apple's Branding Strategy:

Apple uses the Apple brand to compete in its competitive market including personal computers
with its Macintosh line of computers/laptops, the consumer electronics industry with products
and services like iPod, iTunes, the smart phone market with the Apple iPhone. The company is
also establishing a very strong marketing presence in the advertising market, via its business
Apps and iAd network.
Apples Marketing:
According to Rob Enderele (2004), Apple really stands out in its marketing. The company
simply seems to understand what will get people excited about its products and services, then
only it executes on its vision. They dont talk about features or technology, but about how the
computers will make your life better. Apple has also not been afraid of in-your-face campaigns.

The company has run campaigns that have shown Intel-based laptops catching fire and getting
flattened by steamrollers. Also, the place where Apple puts its logo on its products is unique; on
laptops the logo is right side up when the screen is open. As Apple believes that the logo is not
for the person who bought the computer but for the person who is in the market for one. It is
good advertising placement which should not be a throw-away design element. Apple also does
the best placement in the TV shows which really showcases a logo. Even when the other vendors
get a spot, their logos are quite hard to see, as their logos on laptops do not light.
Marketing Mix Of Apple Inc:
Product:
Product is the physical attraction of a specific product or service that makes people wants to buy
that thing.
Apple uses Product Differentiation and Product Development to make its products and services
attractive to the customers.
Apple actively develops new products and replaces old and inferior products as technology and
customer taste changes. Newer product series and versions are available as soon as the older ones
are out of date and out of taste.
Apple is known for its innovations. As history shows apple has always come up with unique
products along with supportive options in it e.g. when iPod was introduced Apple ensured that it
also has iTunes store in place.
Price:
Pricing means what exactly the company would charge its customer for a product or service. Its
an important element of marketing mix. Apple is premium brand that uses Price Skimming and
Premium Pricing Strategies. In the beginning the prices are quite high but Apple eventually
reduces them. Apples Brand loyalty and Brand Positioning can easily get its customers pay high
for a new product launched.
Placement:
Placement means the channel through which the product is going to be made available to the
audience. Whether the product is sold directly through the company, retail outlets, whole sellers
or internet etc.

Firstly, Apple uses direct distribution through Apple stores which are located in many countries.
Secondly, Apple uses retailers to stock up and distribute its products further to customers.
Promotion:
Promotion means how the product is promoted in front of the audience. Its includes all kinds of
advertising, brochures, packaging, sales people, sales methodology etc.
Apple has used a range of media advertising to promote its adverts. Electronic, print, internet,
billboards have all been used while promoting Apple products.
It also promotes its products via personal selling by highly trained staff who have complete
knowledge on the range of Apple products.
Apple also use methodologies like discounts, free shipping, gift cards etc to make its product
more attractive towards the purchaser.

Brand Awareness:
It is when the consumers are familiar about the life or availability of the product. It is the degree
to which consumers associate a companys brand with a specific product or service.

Brand recognition is when the consumers have good knowledge of brand when they are asked
Questions related to a specific brand and they are able to differentiate a brand on the basis of
having noticed or heard about earlier.
E.g. Is I-phone related to Apple or Samsung?
Apples marketing strategies have been successful in making its audience recognize its brand at
first instance when they hear about I-something or any other product or service associated with
it. The main reasons of such great Apples success and brand recognition are its marketing and
advertising capabilities, vertical integration, brand reputation, retail stores and strong distribution
channels.

Apple's retail strategy:

Apple has their own retail stores, though many of the companies failed miserably at having their
own stores. However, for Apple this has been one of the most brilliant moves they made. The

reasons that why some other companies tried owning their own stores and failed was due to
location or a lack of priority, but Apple got both of those correct.
Apple had been very careful about how people buy their products, they authorized retailers with
small shops that carried Apples products and accessories, also they provided an outlet for
support and repair.They later decided to control the retail experience themselves instead if
investing heavily in external retail experience.
Table 2 shows the effect of Apples retail stores strategy on its revenue.

Since 2001 till 2014 there is a tremendous increase in revenues generated Apples retail stores.
Thats why coming up with Apples own retail outlets turned out to be one of the best strategies
to spread its brand.

Apple's Brand Personality:

Apple has a branding strategy that focuses on the emotions of people. Apple brand's personality
is about lifestyle, imagination, liberty regained, innovation, passion, hopes, dreams and
aspirations, and power-to-the-people through technology. The Apple brand personality is also
about simplicity, making life easier for people as they have people-driven product design, and is
a humanistic company with a heartfelt connection with its customers.

Customer Value Proposition:

Customer Value Proposition consists of the benefits that a company offers to its customers in return of
the price they are receiving for that product or service. Apples value proposition seems to best in the
industry as it knows how to engage customers to its products and services. Apple was the first one who
came up with a Smartphone with touch screen. Since then Apple came to know about the need and
requirements of its customers and always come up with something so innovative that customers cant
wait to purchase that product.CVP plays the important role for a company to gain competitive edge
from its competitors. Apples strong CVP makes it gain a competitive advantage from its competitors by
producing products and services according to the needs of its consumer.

Brand Positioning:
Apple has positioned itself to a certain type of customer, wealthy people, innovators, people with
good jobs, good lifestyle, etc. If Apple targets the poor, the trendy people will stop buying Apple. This
would hurt the brand more than the increasing sales because of lower prices, and in good times,
where everybody has more money.
On the other hand, there are no real substitute products, there are no similar machines that one can
buy to have the same user experience as with Apple.

Point Of Difference & Point Of Parity:

POD & POP are completely opposite in nature.POD refers to attributes and benefits in a product
or service that differentiates it from that of its competitors whereas POP refers to attributes and
benefits that can also be obtained from a similar product or service from another competitor. To
maintain its brand and customers a company needs to maintain its POD and this POD must not
turn into POP. Apple is maintaining its POD from years and is not letting any other competitor
turn its POD into POP. Apple continuously comes up with unique and different products and
associated services that other companies hardly provide. However Samsung is in tough
competition with Apple nowadays.
Apple's Brand Equity:
Brand equity is the premium value that the company realizes from a product with a recognizable
name as compared to its generic equivalent firm. Companies can create brand equity for their
products by making them memorable, easily recognizable and superior in quality and reliability..
Brand equity is said to be positive if the consumers are willing to pay more for a branded product
than for a generic one. Brand awareness plays a key role in building brand equity. Create reliable
brand image, slogans and taglines, helps to strengthen brand awareness which therefore improves
brand equity. Since Apple has strong brand awareness, it has high sales and high market share,
and the consumers are well acquainted and familiar with the brand and its products. They are
also willing to pay premium price for their products, relative to the competitor's brand due to
Apple's positive brand equity. Apple is not just intimate with their consumers but there is a real
sense of community among users of its main product lines. Therefore, this also helps to create

consumer's brand loyalty (where brand loyalty is when the consumers become committed to your
brand, choosing it over competitors and making repeat purchases over time.)
SWOT Analysis of Apple
It is a method of is a method of analyzing a business, its resources, and its environment.
To analyze internal and external factor of Apple Inc SWOT analysis will be carried out. SWOT
analysis help to identify Strengths, Weaknesses, Opportunities and threats faced by an
organization. It provides with internal and external factors that the company is good at and
factors where the company needs improvement and consideration.
Strengths relate to internal resources and capabilities that can be used in a competitive
advantage:
Apple has positioned itself for producing highly technical and innovative products in the
computer (MAC), mobile (iPhone) and electronics (iPad, iPod) industry. It is one of the original
hardware producers in the market that controls both the manufacturing of its products as well as
they create their own internal components for the core of its computers. Apple produces high
quality products in order to meet customer satisfaction. It has a strong and dedicated Research
and Development department which helps in creating of new efficient, innovative products for its
consumers. A company is known for having the most brand loyal customers who buy their
products for quality, regardless of the high price. Such powerful loyalty of customers means that
Apple has a strong positioning of their brand and that they not only creates new customers but
retains them, as they keep returning back to avail the company's products and services. They
have a strong presence in the corporate and education segment, with a strong brand name
known globally. Apple does smart marketing, that is clever and which takes advantage of
customer's frustrations with other brands products. They have got Eye catching retail stores with
highly technical products and providing experiences of Apple's software.
Weaknesses relate to the internal factors of an organization that work against the outcome
desired:
Increasing competition in the market, many similar producers of tablets, smart phones and
computers might create difficulty in ensuring consistency and quality for its products. Apple has
failed to promote two of their products, Apple TV and Mac mini which may lead to lower sales
hence lower market share in future. Apple is facing pressure to increase the price of their music
download files on itunes as many of the music industry artists make more money from iTunes
(i.e. downloadable music files) than from the CD sales. Premium pricing for all products lose a
potential customer base that are price conscious, who wish to buy Apple but cannot, because of
its premium pricing.

Opportunities are the external factors that help in achieving the objectives of the organization.
These are factors related to the market and environment which help in the growth of the
organization:
Apples products demand may increase in the future due to constant growth of computer , mobile
and technology market. There is growing market of green and energy saving products as
consumers are now aware of environmental issues as well. They now prefer environmental
friendly products and Apple claims to be providing such products and taking care of the
environment. Apples Joint venture and acquisitions help to maintain good relationships with
companies and to eliminate competition .It is expanding more internationally into the Asian
countries with more and more retail stores being opened.
Threats are the external factors that which are hurdles in achieving the objectives of the
company:
Apple has to face high competition in the market with mass existence of technology giants like
Microsoft, Dell, Samsung, HP, HTC, Nokia, Toshiba, etc, making the market highly saturated.
Samsung has captured a huge market with its latest series of smart phones. Hence there is a shift
in consumers tastes from Apples products to other firm's products. New products have been
emerging as substitutes like Samsung Tablet, which has a potential to end the need of
having a phone along as it allows making calls along with the tablet features. Moreover, with
unemployment increasing and global recession may reduce wants of the customers for such
premium products.
Conclusion and Recommendations:
Conclusion
The main aim of this branding project was to conduct a study on the marketing strategy of
branding in Apple. The study helped apple to find out more about the segmentation, targeting,
positioning, branding strategies and marketing mix strategies. Furthermore, a SWOT analysis
was done to recognize the strengths and weaknesses of Apple along with the opportunities and
threats that the company may be facing. The analysis helped Apple in identifying the success
factors that will help in gaining a competitive edge; allowing it to increase profit, brand power
and customer loyalty proving it to be a well-known, leading and a successful company in the
saturated technology industry. Survey findings were made to find if the marketing strategies of
branding are proving to be effective or if any changes are needed to be made in the future. The
literature review consisting of the secondary data and the descriptive survey research consisting
of primary data, they both helped in fulfilling the objectives of the dissertation, which helped in
conducting a study on the marketing strategy of branding, by recognizing the problems that
Apple maybe facing in order to improve or eliminate them.
Recommendations
Provide value for the products offered
If a perception is created that Apple is offering its customers with fine products with premium quality
in the industry, which is not being offered by others; than Apple should be able to differentiate
themselves from their competitors in order to still keep premium pricing for their products.
Conduct more aggressive promotion

Increasing promotional programs never proves to be damaging for any firm, but only proves to be
beneficial, it not only helps to attract potential customers, but also new customers boosting customer
traffic and sales. Apple should also start creating 'TV commercials', in such a way that educate the
customers about the latest technological product, making it seem more appealing. Also, they should
start focusing on advertising all products not only new products in order to meet the sales target for
all products.
Make maximum innovations
Technology market is a highly competitive market, its very easy for competitors to clone your
products and sell as new products by making small innovations. Therefore, it has become very
important to keep making constant innovations in design, features and specifications in order to
differentiate your product from competitive brands and to be able to dominate the market.
Offer price reduction offers from time to time
Instead of not charging premium, price reductions, free gifts, vouchers, VIP cards, etc. can be made
for a limited period of time, to allow customers to buy from Apple more often. Thus, this may help
Apple to attract new target group customers increasing its fan base, along with sky rocketing its
brand loyalty and sales.
Open more Apple outlets in different areas
Since Apple relies on online, direct and retail distribution methods, its important for Apple to
expand its direct reach through its own stores and retail stores by locating stores in a more
reachable district, like residential areas so that people can have an easy access to the stores.