Running head: Apple Inc – Marketing Mix and BCG analysis

Apple Inc – Marketing Mix and BCG analysis

 2
Apple Inc – Marketing Mix and BCG analysis

Table of Contents

Introduction ..................................................................................................................................... 3
Purpose of writing the report ....................................................................................................... 3
Range and scope of the report ..................................................................................................... 3
Topic One........................................................................................................................................ 3
Marketing mix strategies for an existing product of Apple ........................................................ 3
Topic Two ..................................................................................................................................... 10
Strategic allocation and coordination of the marketing and company resources for the
recommended marketing mix strategy ...................................................................................... 10
Strategic allocation of resources ............................................................................................... 13
Relevant marketing strategies of Apple Inc .............................................................................. 16
Conclusion .................................................................................................................................... 17
Reference ...................................................................................................................................... 18
 3
Apple Inc – Marketing Mix and BCG analysis

Introduction

The report is based on Apple Inc. and the ways by which the company can use the

process of strategic marketing to establish its products in the market. The report will be produced

from the perspective of a strategic marketing consultant at Apple. It is essential to note that

Apple Inc is one of the emerging companies since 1976, and it has been able to deliver best

quality products since then. The products are famous for quality and durability. As a consultant, I

shall be analysing the marketing strategies of Apple Inc.

Purpose of writing the report

The purpose of the report is to identify areas of the marketing process that can aid the

company in the near future. Further, few recommendations will be given regarding resource

allocation strategies.

Range and scope of the report

The scope of the report is massive. After analysing the suitable marketing mix strategy, it

will be easier to recommend the ideal strategy for the business. This, in turn, shall help the

company in establishing its goals and vision.

Topic One

Marketing mix strategies for an existing product of Apple

Marketing Mix

The concept of the marketing mix involves many areas of action which are part of an

extensive marketing plan. Marketing mix points towards a general classification that includes the
 4
Apple Inc – Marketing Mix and BCG analysis

four Ps of marketing: Price, Product, Promotion, and Placement. It is important to note here that

apart from these four Ps that are entirely focused on the marketing of products, there are three

other Ps that focus on customer-based services. These additional Ps include People, Process, and

Physical evidence. In the present report on Apply Inc., the four main Ps have been emphasized.

Apple Inc. is said to be the biggest tech giant in the world. Their worth is 87% more than that of

the second-largest company, Google. It is interesting to note that Apple has consistently been

ranked as the most profit-making company every year since 2010 by Forbes. The company has

reached great heights owing to its brilliant marketing strategies.

Product – The product is nothing but the physical good or the service provided by a company

that serves to meet the needs or demands of the customer or client. What is important here is that

the manufacturers of the product must identify and understand their prospective customer or

client base. Also, the manufacturer must determine the factors that differentiate the products or

services of the company from those that are manufactured by business competitors (Jackson &

Ahuja, 2016).

The products of Apple Inc. are innovative as they are designed and produced after

research their customers as well as potential customers’ needs and demands thoroughly. It cannot

be denied that the tech giant does seem to identify the desires and demands of its customer base.

From the Macintosh to the Apple Watch and Apple TV, the company has found a market for

every product and service that they launched ever since its inception. However, in this report, the

focus is on the iPhone that is inarguably the most-used cell phone in the world. What Apple had

done that no one had attempted before is that the iPhone was launched as the first smartphone

that used a multi-touch user interface. The advantage that this provided to the users is that it

eliminated the necessity for keyboards and styluses. Apple launches a new model of the iPhone
 5
Apple Inc – Marketing Mix and BCG analysis

every year with new and improved features. The demand is astounding, and it has made the

company one of the largest smartphone brands in the world (Tansim, 2018).

The soon-to-be-launched iPhone XI is already in high demand with one showroom

already having around 72 pre-orders. The iPhone XI has been upgraded with the newest

technologies, which increase its speed, by 20% than its predecessors and uses 15% less power.

The battery is expected to last 4 hours more than its predecessors are which gives it a massive

boost than its earlier versions. The smartphone also comes with a triple camera with an ultra-

wide lens, wide lens, and a telephoto lens. This enhancement makes the iPhone XI camera the

best smartphone camera in the world. Night mode has a high demand, and the new iPhone XI has

incorporated it.

Recommendation:

Though the iPhone XI has almost every feature one can think of, the lack of 5G

technology is shocking. Apple’s biggest competitor in the smartphone market, Samsung, has also

announced its upcoming devices with the 5G network. Even Google is expected to launch its

forthcoming phones with 5G compatibility. Therefore, to keep up with Samsung in this zone,

Apple should also introduce the most-awaited 5G network technology in its subsequent devices.

The 5G network is so desired by users mainly because it will make the internet speed super fast,

leading to faster downloading and uploading (Steenkamp, 2017).

Besides, iPhone XI has a ram of only 4 GB, whereas other brands are offering at least 6

to 12 GB Ram at a much lesser price than Apple iPhone XI. Therefore, another recommendation

would be for Apple to upgrade the ram size to justify the high cost of their products.
 6
Apple Inc – Marketing Mix and BCG analysis

Figure 1: Apple’s Marketing Mix Strategy

(Source: SlidePlayer.com)

Price - The second P of the marketing mix, Price, refers to the exact amount that the customer or

client is expected to pay in exchange for a product or service. The pricing of a product has a

direct impact on its sales. This pricing has an intricate relationship with the value proposition of

the product to the customer, instead of an actual cost of the item on offer. Also, distribution

plans, markups, and expenses of the value chain may affect the pricing of a product. Besides

these factors, the pricing of rival products is also likely to affect the price of products and

services (Wu & Li, 2018).

Apple Inc. uses premium pricing for its products. Not only their loyal customers but also

new customers are willing to pay a much higher price as compared to other brands. The only

reason behind this is that Apple is continually innovating and making use of modern technology

to design its products. The iPhone, for example, is inarguably the highest-selling smartphone in

the world. But every year, with the launch of a new model, millions of customers make a beeline
 7
Apple Inc – Marketing Mix and BCG analysis

for it merely because of the latest technologies and novelties the new model has come with.

Apple generally does not have sales where they price their products at a much lesser price than

its standard rate (Baltes, 2016). The price does not drop until a new model is launched. This

marketing strategy of premium pricing by Apple attracts not only upper-class customers but also

middle-class buyers, thereby helping the company to maintain its high-end image. The 64 GB

variant of the Apple XI Pro costs $1949, and iPhone Pro Max costs $2149 ("iPhone", 2019).

Recommendation:

A notable drop in the sale of iPhones has been observed, with many customers shifting

their loyalty to other rival brands due to them offering the same and in some cases more features

than iPhones at a much lesser price. Though Apple has been working on improving and

introducing new configurations in their devices, the recent decline suggests that pricing a lower

price might be an excellent option to gain back their lost customers (Zhang, 2017). There

remains the fact that the features and improvements offered by an iPhone are nothing new as

such features are already provided by other brands. Therefore, lowering their prices for some

time would bring back the lost customers and prevent any chances of facing losses for the

company.
 8
Apple Inc – Marketing Mix and BCG analysis

Figure 2: Marketing Mix

(Source: Marketing91.com, 2019)

Placement - This strategy of the marketing mix deals with the ways of providing the product to

the customer. An essential element of product placement is distribution. This strategy will help

the company to determine which channel would suit the product the most. Additionally, how the

product is made available to the customers and how they access it also comes under this

marketing strategy. Moreover, market specialists also need to identify and assess where their

products or services would be most well-received (Hisrich & Ramadani, 2017).

Apple Inc. maintains clear guidelines regarding who has permission to sell or distribute

their products. The company has authorized only selected stores to sell their products. This may

seem to restrict its reach, but this move is also necessary to maintain its high-end reputation

among the consumers. Apple iPhones are available in Apple Stores and the online Apple Store.
 9
Apple Inc – Marketing Mix and BCG analysis

Other stores sell iPhones like telecom companies. Apple targets distributing channels in

Auckland, New Zealand because maximum people can afford to purchase an iPhone there. Apple

does not that much of a demand in the Asia Pacific region as compared to the other areas; hence,

it does not invest much in the distribution channels in this region (Fadel, 2019).

Recommendation:

One suggestion would be to make their products more accessible and at a lesser price in

those areas where the sales revenue is limited. When they gain enough foothold in the region,

they can go back to their standard rate. Moreover, they need to compromise with their high-end

image and authorize more stores for their products, especially in places where there is a high

demand, to increase the sales revenue.

Promotion - The marketing campaigns are undertaken by a company to launch its new

product/products are known as the promotional mix. Promotional activities may include sales

promotion, advertising, PR, and personal selling. Determining the ideal mediums to reach out to

the customer base is an important consideration here (Kucuk, 2017).

Apple Inc. typically makes use of print ads and TV commercials to promote their

iPhones. Their ads focus on the new features that they have introduced in the new model, and

how the model is different and better than their rival products. Commercial advertisements are

used mostly when the product is launched, but print ads run all through the product’s existence.

The ads are quite precise and straightforward and usually focus on one major feature of the

iPhone. Apple’s annual opening statements are a significant element of the company’s

promotional strategy. These events not only promote their products, and services must also

constitute a substantial part of their image and brand building. Fans and potential customers
 10
Apple Inc – Marketing Mix and BCG analysis

receive information and updates through these events. For instance, the Apple iPhone X had a

very unconventional promotion with the YouTube first impression video coming out first and

becoming a much-talked-about topic among users. Next, the reviews by many prominent

celebrities gave its development an added boost. The tech giant gave some YouTube tech

reviewers hands-on access before launching the phones in outlets. For a long time after the

promotions began and after it was finally launched, Apple made sure that the iPhone X was all

that people talked about (Dolata, 2017).

Recommendation:

Apple Inc. should focus on promoting not only the latest and fanciest features they have

introduced in their newest model. Instead, they should also address the problems that were

present in the predecessors whom they have solved in their most recent model. Their

promotional activities need to be less product-oriented and instead geared towards addressing

solutions and fixes in their latest products.

Topic Two

Strategic allocation and coordination of the marketing and company resources for

the recommended marketing mix strategy

A company sustains within a market by strategically positioning itself. A framework

known as the BCG matrix can be used to evaluate the position of the company and its current

potential. Market share, as well as industry attractiveness, is measured by the BCG matrix

(Mohajan, 2017). The matrix is divided into four components: Question marks, Stars, Cash Cows

and Dogs. The products of a company can be categorised into each of these types. For instance,
 11
Apple Inc – Marketing Mix and BCG analysis

star products have the best market share, and consequently, it generates higher profits. However,

star products require substantial cash to sustain in the market. Secondly, products that fall under

the cash cow category are considered leading products. However, the growth rate of such

products is slow (Pruschkowski,2018).

Further, products falling underdogs’ category possess neither high market share nor

growth. Hence, the chances of survival of such products are negligible. Lastly, products under

the question marks category consume massive cash; however, the market share is low.

Nevertheless, the growth prospects are high if proper investment is made.

After analysing the marketing mix strategy of Apple Inc, it was understood that Apple

had established itself as one of the most valuable brands because of its innovative products and

marketing strategy. Product promotion is done via commercials and ads that can capture the

attention of customers (Khan, Alam & Alam, 2015). As a consultant, it is observed that Apple

products fall under the four categories of the BCG matrix. A detailed product allocation has been

outlined below-

Stars: As discussed earlier, stars products of a company have a significant market share, and the

products can further expand within the industry. In the case of Apple Inc, I have found that

iPhones can be regarded as Star products. It is evident because the company can quickly gain

market share as soon as it launches iPhones. Further, setting innovative sales records will be

easier for the company. Customers are loyal to Apple iPhones, and it can be recommended that it

can give fierce competition to other products existing in the market.

Cash cows: In the case of cash cows, the products lead the market. However, the rate of growth

is slow. For instance, Apple iTunes, iMac’s and Apple MacBook fall under this category. As a
 12
Apple Inc – Marketing Mix and BCG analysis

consultant, I have observed that Apple has aimed to develop a niche and has attained the cash

cow position. It is further noted that loyal customers are likely to prefer products under this

category. Apple Inc used to deliver computer products, but gradually the company started to

produce MacBooks and Apple iMac because customers prefer mobile products (Nickols, 2016).

Dogs: As mentioned earlier, this quadrant is reserved for those products that have the potential

for growth, but somehow fails due to slow market. Under the Dogs category, Apple iPods fall

easily. The merchandise would have secured a safe place; however, it was unable to make a

significant impact due to slow market growth.

Question marks: Finally, the last quadrant of the BCG matrix is the question marks and

products falling under it do not reach its potential for multiple reasons. For instance, Apple TV

does not have the potential to dominate the market like other Apple products such as iPad or

iPhone.
 13
Apple Inc – Marketing Mix and BCG analysis

Figure 3: BCG Matrix

(Source: google.com, 2019)

Strategic allocation of resources

Allocation is a process that involves the consideration of multiple factors like risk assessment,

investment horizon, asset allocation, rebalancing, monitoring and further allocation (Guesalaga

et al., 2018).

Figure 4: Strategic allocation process

(Source: businesstoyou.com, 2019)

Apple Inc has established itself in the electronic industry by focussing on innovation and

marketing over the past 30 years. In a rapidly changing environment, the company has managed

to allocate its resources carefully by following the allocation process. The company can further

improve its position in the market by focussing upon newer and advanced products. The

company can use its unique retail strategy while making product-related decisions. Moreover, it
 14
Apple Inc – Marketing Mix and BCG analysis

can start capitalizing on advanced trends to establish itself in the market. Companies in today’s

markets are aiming to prosper, and it is necessary to understand the strategic capability for

gaining competency in the market.

Further, the company possesses tangible and intangible resources that can aid the

company in strategically placing itself in the market. Tangible resources include equipment,

lands, and buildings, while the intangible ones are non-physical resources (Gronroos, 2016).

Intangible resources are valuable for the company. The categorization has been done below-

Tangible resources of Apple

Product resources- Apple has successfully transformed its position, and the company has now

focussed on electronic products such as iPod digital, iPod series launch, and Apple pod. Hence,

by using the mentioned products, it has transformed its position in the market.

Financial resources- The Company has also increased its net income to $1335 billion, and now

it is independent enough to obtain credit.

Technology- Apple focuses upon developing user-friendly products, and it has invented the PC,

iPod, GUI or graphical user interface and iTunes.

The company can use these tangible resources to establish itself in the market.

Intangible resources of Apple

Similarly, the company possesses a range of intangible resources that can be utilised to

gain a competitive advantage. For instance, the company’s innovative approaches and

contribution of creative people have helped in the development of an excellent brand image.

Further, intangible resources such as patent, trademark, proprietary technology, relationship with
 15
Apple Inc – Marketing Mix and BCG analysis

customers, organizational image and enterprise culture have improved and can also enhance the

positioning of the company (Pride & Ferrell, 2016). For instance, the company manages to

maintain trustworthy relationships with customers by offering valuable and sustainable products.

Other significant intangible resource includes the corporate image of the company. The core

values are reflected in their services and products. The company could gain reputation and

popularity by enhancing its image.

Moreover, the trademark of the company is another intangible resource of Apple Inc, and

it has successfully established its mark besides its logo. Lastly, it is worth mentioning that patent

of Apple Inc, is unique and it includes “Enforcing service policies in embedded UICCs”,

“Evacuation of liquid from acoustic space”, “In-vehicle wireless communication”, “Portable

electronic device” and many others. Hence, the owner of Apple possesses the right to exclude

other entities from exploiting patent technology. No other company has the right to sell, make or

use any “patented invention”.

The marketing strategies of Apple have been established in a manner that made the

company successful. After analysing its marketing mix, it was understood that with changing

times, the company has focussed upon innovation and quality of products. Firstly, the marketing

mix of Apple that is concentrated on improving price, promotion, product, and place is the sole

ways of gaining advantage and profits (Ryan, 2016). The marketing strategies utilised by the

company are worth mentioning.

Moreover, after analysing the available company resources and company assets, it can be

suggested that the company already possesses a range of talented engineers and designers and

therefore, it can further make progress in designing and development. The company has focussed
 16
Apple Inc – Marketing Mix and BCG analysis

upon revolutionary products such as the iPod and iPhone. Accordingly, resources have always

been allocated to innovating new products. The products are functional and useful. Apart from

developing software applications, the company has focussed on developing its hardware

platform. Again, it is one of the most robust resources, and advanced technology is used to

modify and maintain the resources. Apple can compete with other companies because it can

create unique designs. The focus is upon screens and touchpads that have better functionality.

Differentiation and quality are the key motivators of Apple Inc. Lastly, the company has

focussed on improving its brand image within the electronic industry.

Relevant marketing strategies of Apple Inc

Focus on advertising

The organisation understands the importance of advertising, and therefore, it can promote

its products undertaking the product placement strategy. It also uses social media to create buzz

around its products. To increase its market share, the company uses social media advertising

rigorously (Shenoy & Prabhu, 2016).

Further, companies utilise the fame of celebrities to promote or advertise their products.

However, Apple Inc does not use this strategy. It instead focuses on company influencers to

target their audience. The influencers naturally share the product with followers on social media.

It has a positive impact on the minds of the target audience.

Avoiding price wars

The company does not get involved in competing with prices. Instead, it is focussed on

developing a unique range of products that can attract and retain loyal customers. The company

emphasizes on UVP or Unique Value Proposition (Apple, 2019). In that case, customers are
 17
Apple Inc – Marketing Mix and BCG analysis

likely to pay more for a product. For instance, Macbook Pro of Apple costs around $1000, while

that of Dell costs $750. Nevertheless, people are likely to pay more and buy Apple's products

due to their UVP.

Keeping the products simple

Another crucial strategy of the company is focussing upon simplicity. It is better to focus

on less, but make it perfect rather than concentrating upon multiple items (Kreutzer, 2019). The

chance of confusion slows down and keeping products simple, and it helps the company in

attracting more customers.

Conclusion

The report is written to address the crucial areas of strategic marketing and the function

of resource allocation and marketing coordination of the chosen company. Here, Apple Inc has

been selected, and relevant strategies utilised by the company have been outlined. For the first

part, 4Ps of marketing has been chosen, as it is applicable in Apple's case. After that, in the

second section, the importance of resource allocation has been discussed. It was understood that

Apple’s tangible and intangible resources were considered as it can help the organization in

achieving its marketing objectives.

 18
Apple Inc – Marketing Mix and BCG analysis

Reference

Apple. (2019). Site Map. [online] Retrieved from: https://www.apple.com/sitemap/ [Accessed 26

Sep. 2019].

Baltes, L. P. (2016). Digital marketing mix specific to the IT Field. Bulletin of the Transilvania

University of Brasov. Economic Sciences. Series V, 9(1), 33.

Dolata, U. (2017). Apple, Amazon, Google, Facebook, Microsoft: Market concentration-

competition-innovation strategies (No. 2017-01). Stuttgarter Beiträge zur Organisations-

und Innovationsforschung, SOI Discussion Paper.

Fadel, S. (2019). Encyclopedia of major marketing strategies, volume 4: edited by Mathew

Miskelly, Farmington Hills, MI, Gale, 2019, 500 pp., $683.00, ISBN 978-1-4103-8934-3.

Grönroos, C. (2016). Internationalization strategies for services: a retrospective. Journal of

Services Marketing, 30(2), 129-132.Jackson, G., & Ahuja, V. (2016). Dawn of the digital

age and the evolution of the marketing mix. Journal of Direct, Data and Digital

Marketing Practice, 17(3), 170-186.

Guesalaga, R., Gabrielsson, M., Rogers, B., Ryals, L., & Cuevas, J. M. (2018). Which resources

and capabilities underpin strategic key account management?. Industrial Marketing

Management, 75, 160-172.

Hisrich, R. D., & Ramadani, V. (2017). Entrepreneurial Marketing Mix. In Effective

Entrepreneurial Management (pp. 75-99). Springer, Cham.

iPhone. (2019). Retrieved 26 September 2019, from https://www.apple.com/iphone/

 19
Apple Inc – Marketing Mix and BCG analysis

Jackson, G., & Ahuja, V. (2016). Dawn of the digital age and the evolution of the marketing mix.

Journal of Direct, Data and Digital Marketing Practice, 17(3), 170-186.

Khan, U. A., Alam, M. N., & Alam, S. (2015). A critical analysis of internal and external

environment of Apple Inc. International Journal of Economics, Commerce and

Management, 3(6), 955-961.

Kreutzer, R. T. (2019). Strategic and Operational Marketing Plan. In Toolbox for Marketing and

Management (pp. 225-229). Springer, Cham.

Kucuk, S. U. (2017). Marketing-Mix Modeling. In Visualizing Marketing (pp. 83-93). Palgrave

Macmillan, Cham.

Mohajan, H. (2017). An analysis on BCG Growth sharing matrix.

Nickols, F. (2016). Strategy, strategic management, strategic planning and strategic

thinking. Management Journal, 1(1), 4-7.

Pride, W. M., & Ferrell, O. C. (2016). Foundations of marketing. Cengage Learning.

Pruschkowski, M. (2018). The BCG Matrix and its Support of Management Decision Making.

GRIN Verlag.

Ryan, D. (2016). Understanding digital marketing: marketing strategies for engaging the digital

generation. Kogan Page Publishers.

Shenoy, A., & Prabhu, A. (2016). Social Media Marketing and SEO. In Introducing SEO (pp.

119-127). Apress, Berkeley, CA.

 20
Apple Inc – Marketing Mix and BCG analysis

Steenkamp, J. B. (2017). Global Marketing Mix Decisions: Global Integration, Not

Standardization. In Global Brand Strategy (pp. 75-109). Palgrave Macmillan, London.

Tansim, M. (2018). An Organizational Analysis on Apple. European Journal of Business and

Management, 10(11).

Wu, Y. L., & Li, E. Y. (2018). Marketing mix, customer value, and customer loyalty in social

commerce: A stimulus-organism-response perspective. Internet Research, 28(1), 74-104.

Zhang, Q. (2017). Research on Apple Inc’s Current Developing Conditions. Open Journal of

Business and Management, 6(01), 39.