Symbiosis Institute of Media and Communication, Pune Marketing Management -Prof. Chandan Chatterjee Marketing Diary Apple Macbook Pro Submitted By: YASMIN HUSSAIN 144 MBA 2011-2013 2 TABLE OF CONTENTS TOPICS PAGE NO. Product chosen 5 About the company 6 About the product 7 AMA and Marketing 8 • AMA • Marketing • My view Customer Value 11 • Value chain analysis • Customer Perceived Value Product 20 • Core/Augmented Products and Services • Product Levels • Product classification and hierarchy • Product Mix • Product Lifecycle • Industry Lifecycle Competitors 27 • Competitor Map • Direct Competitor Comparison • Competitive Forces • Market Share Pricing 31 Brand 33 • Branding • Brand Equity • Branding Strategy • Apple and the environment 3 Marketing Communications 42 • Marketing Mix • Marketing Communications Mix (ATL & BTL) • IMC Campaigns Distribution Decisions 87 • Distribution Structure • Target • B2B Channels • B2C Channels • Retail Strategy – SWOT Analysis • Apple Store Vs Luxury Retailers Sales Management 95 Consumer Behavior / Organizational Behavior 96 • Consumer Decision Making • Consumer Satisfaction • Organizational Culture • Organizational Structure STP 103 • Segmentation • Targeting • Positioning Role of Marketing Management 107 • Marketing Manager Role What makes Apple different? 109 • Income Sheet • Milestones • Apple without Steve Jobs References 120 4 PRODUCT CHOSEN APPLE MACBOOK PRO 5 ABOUT THE COMPANY- APPLE Industry: Computer Hardware, Computer Software, Consumer Electronics, Digital Distribution Founded on: 1 April 1976 Founders: Steve Jobs (Chairman and CEO), Steve Wozniak, Ronald Wayne Headquarters: California, U.S. Products List: Mac, iPod, iPhone, iPad, Apple TV, Mac OS X, iLife, iWork, iOS Services List: Apple Store, Apple store online, App Store, iTunes store, iBooks, MobileMe 6 ABOUT THE PRODUCT FEATURES 7 AMA AND MARKETING AMA • American Marketing Association • The professional association for individuals and organizations who are leading the practice, teaching, and development of marketing worldwide • Founded in early 1900s MARKETING AMA DEFINITIONS: Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (Approved October 2007) Following diagram depicts the change in definition of marketing (by AMA) over a span of 7 decades. 8 9 My View: According to me, marketing is a process of identifying and fulfilling needs and wants of the customer by creating, communicating and delivering value. The central focus is customer. 10 CUSTOMER VALUE VALUE CHAIN ANALYSIS ACTIVITY EXAMPLE Administration A greener Apple–Apple redesigned packaging for many of its popular products to be more lightweight and take up less space in shipment. This means reduced emissions during transportation and results 11 in a savings for the firm. Apple has also made moves to reduce the number of harmful chemicals used in the production of its products. Strong cash position– Apple maintains a large cash reserves and carries a comparatively small amount of long-term debt. This way it can finance expansion, capital purchases, and development internally with little reliance on third-party creditors. Human Resource Management Selective hiring process– Apple follows selective hiring practices to recruit and hire talented individuals. Generous employee benefits program–Apple offers a variety of attractive employee benefits to complement direct wages. The benefits system is used to entice, and retain industry-leading talent to benefit Apple. Technological Research and development– Apple increased Development research and development funding by nearly 66% from 2007 to 2009.In 2009 Apple spent $1.33 Billion on research and development. This is a commitment to continue to push innovation forward to keep ahead of competition. Patent filing– Apple believes in the importance of protecting its intellectual capital by filing patents in the United States and worldwide for its inventions and innovations. Apple currently holds a portfolio of several thousand patents. Procurement Positive relationships with suppliers– Apple works closely with its key suppliers to benefit all parties involved. Apple is a member of the Electronic Industry Citizenship Coalition (EICC) and works to ensure fair treatment of workers in OEM factories. Apple has also developed its own Supplier Code of Conduct to govern the actions of its suppliers. These beneficial steps foster positive relationships with suppliers. 12 Inbound Logistics Automated receiving systems– Apple has implemented sophisticated automated receiving systems to speed up the receiving process and reduce facility footprint and storage space requirements. Delegate raw materials acquisition– Apple works with its OEM partners to delegate the raw materials acquisition process but provides some supervision for quality control purposes. Operations Utilize OEM’s economies of scale– Apple outsources production to third-party OEM partners to utilize their economies of scale while removing the burden of production management from the firm. Internal design– The design and conceptualization of current and future products is done internally at Apple, utilizing industry-leading industrial design teams and engineering knowhow. Outbound Logistics Economical/stylist packaging– In order to save money on shipment and entice customers, Apple uses eye-catching packaging that takes up less physical space and weighs less. This reduces shipping costs and environmental effect while attracting customers to the firm’s products. Apple Stores/Authorized retailers – To control the firm’s brand image Apple sells through first-party retail establishments and through authorized retailers. Apple Stores act as advertisements for the brand and provide a human point of contact between the firm and its customers. Authorized retailers are held to certain standards to protect Apple’s brand image. Direct shipment–Apple.com online orders are shipped directly to consumers from storage facilities in China. This minimizes inventory buildup in more costly warehouse locations in the United States. 13 Marketing and Sales “Get a Mac” Ads – Apple uses a series of television advertisements comparing the firm’s products to competitors using a variety of direct and indirect methods to build a lifestyle brand image. The ads are humorous and do not emphasize cost or feature-by- feature comparisons, opting instead to develop the firm’s image. Retail locations/Flagship stores– Apple stores across the United States serve as living advertisements for the company promoting the brand and lifestyle image. Flagship stores, like the 5th Avenue New York store are an attraction drawing visitors on novelty hoping to convert the visits into sales. Secretive and selective unveilings– By keeping secrets about product releases and holding invitation- only press events for product unveilings, Apple creates hype and suspension around product launches Servicing Apple Genius – Apple stores house the ‘Apple Genius Bar’ where customers can talk with an Apple specialist known as a ‘genius’ about problems with their device. This human interaction with a first party service provider builds a rapport with customers and offers a stark contrast to endless phone service calls. Included and extended warranty– Apple offers an included 90 days warranty against defects and issues with its products. Customers can also purchase extended warranties through ‘Apple Care’ to protect their product. Free consultation– Customers can bring in their device for a free consultation regarding issues problems with no commitment, whether it is in or out of warranty. The customer then has the option to pursue different avenues of resolving the issue without an upfront charge 14 CUSTOMER PERCEIVED VALUE CUSTOMER PERCEIVED VALUE TOTAL CUSTOMER TOTAL CUSTOMER BENEFITS COST PRODUCT VALUE MONETARY COST SERVICE VALUE TIME COST PERSONNEL VALUE ENERGY COST IMAGE VALUE PSYCHIC COST VALUE OF MY PRODUCT: PRODUCT VALUE: • SIMPLE AND ELEGANT DESIGN • WORKS EFFICIENTLY • FASTER PROCESSOR 15 Following diagram is an example why customer values the product: SERVICE VALUE: • STORE EXPERIENCE PRE/POST SALES • EXTENDED WARRANTY /REPLACEMENT • FREE APPLICATIONS 16 17 Apple retail stores are all owned and operated by Apple – they are chain stores. There are more than 300 worldwide, and 4 of them are located here in NYC. The stores offer an outstanding level of service, including free workshops, one to one membership service, and the genius bar. The Apple Store (Apple’s online store) is also very popular, as it is accessible worldwide and convenient. Online or by phone, one can also customize Apple products. Apple retail stores can be classified as specialty stores. “Consumers usually consider price to be secondary in specialty outlets. Instead, the distinctive merchandise, the store’s physical appearance, and the caliber of the staff determine its popularity.” Apple stores are most certainly fine tuned to cater to the Apple consumer and to embody company brand image and ethos. The stores also add to the feel of exclusivity. The Apple stores’ motto is: “Come to shop. Return to learn.” The stores have a very welcoming atmosphere. The displays are sparsely laid out on big tables and very easy to interact with. All computers, phones, and pads are always on and have Internet connection, so you can fully experience the product. The sound in the store is soft; the music is soft rock and classics