Analysis of the Integrated Marketing Communications Mix Strategies of Apple

Executive Summary

Apple Inc. is a global company specialized in technology. It is a world industrial leader. Speaking about strategic management of Apple Inc., it is necessary to say that the leader and employees of the company devote much attention to it. The strategic plan, leadership, strategic goals and tactics are connected with the innovations and implementation of new technologies. Investors, customers, employees, communities and competitors are the main stakeholders. It is evident that the complex activity of stakeholders, collaboration and communication between them belong to the corporate strategy of Apple Inc. The report identifies the key competitors, market trends and external factors that influence the strategic decisions.

Current report focuses on revealing the peculiarities of the integrated marketing communications mix strategies of Apple Inc. It shows marketing possibilities and competitiveness of the company. Current paper is devoted to the brand image, brand awareness and brand equity of the company. It proves that for being more profitable Apple Inc. should look for new locations and new consumers and the most important to innovate and develop. Current paper shows the peculiarities of corporate and business strategies of external and internal issues of Apple Inc. The report analyzes the marketing strategy of Apple Inc.

Key Words: marketing communications mix strategies, competitiveness, marketing weaknesses and strengths

Introduction

With the development of new technologies and innovations in all spheres of life, any organization or company needs to move forward. All organizations should provide their customers with the most qualitative services and products that will satisfy their needs and demands. As a result, organizations are faced with such issues as the improvement of their activities, operations and marketing communications mix strategies.

Apple Inc. is an extremely popular American corporation that sells the latest gadgets, develops computer electronics, personal computers, software and portable devices (Ashcroft 2012). However, the rapid changes at the global market are having a serious effect on Apple Inc. As a result, it faces different problems, as well as advantages. The past years have seen the rapid development of Apple products. The highest peak of success was after 2007 with launching of the iPod, iPhone and iPad. It is evident that innovations brought success and revolution in technology. However, at the present Apple remains the most prestigious and fashionable brand (Ashcroft, 2012). They had chosen such categories: the dedication to sustainability, the level of customer service, the innovation and creating of new technologies (iCar, iTV, iWatch, etc.) (Ashcroft 2012).

Apple Inc. is interesting for studying as it is a powerful and successful company for following. Orientation on the global market, strategic management and leadership benefit the company.

The main questions addressed in current paper are the peculiarities of Apple Inc., branding and positioning strategies of the design and implementation of integrated marketing communications mix. Moreover, current report reveals the peculiarities of smartphone market environment, company strategies and recommendations how to make Apple’s strategies more efficient.

Literature Review

At the present time, marketing is moving from traditional linear paradigm to interactive paradigm (Figure 1). Famous brands use an interactive model as it is more advanced and presupposes communication and interaction with customers. It is worth saying that the innovative technology advertisement campaigns are larger and more numerous than the advertisement of medicine.

Traditional linear paradigm

Content Creator Content Receiver

 

Interactive paradigm

 

Integrated Communications Pillars concern both internal and external audience. It proves their integration.

 

Brand awareness is realized by introducing it to the potential customers. The number of customers raises the awareness of the company, its services, products and brand names. Advertisement generates a higher level of awareness when it has larger target market. In the advertisement, the main issues are awareness of the brand, awareness of the companys objectives and awareness of possibilities and opportunities among other competitors. Competition is not less important objective of an advertisement (Scott 2011). In the market, competition eliminates the weak companies and establishes the fair struggle between the strong players. Competition creates equal conditions for struggle between brands and stimulates the improvement of services and products of any brand. Today, however, the level of competition is too high and difficult for reaching (Deng 1994).

Image building is the main aim of the advertisement. The company tries to build positive associations with their brands and provoke interest to their products. If they spend money on advertisement, they will double their incomes with time. At first, advertisement works for the image and soon the image works for them. Image building is the main task of any brand. Increasing sales is the next objective of the advertisement. It involves indirect actions as increasing sales depend on the image of the company, its place on the market, its ability to compete among many other issues. Fashion shows are also conducted for making profits (Ferrel & Hartline 2010).

According to the European Journal of Business and Management, customers from European countries pay much attention to brand images and advertisement. They prefer buying the items of the famous brands that are extensively advertised. It means that the brand image and advertisement have a direct effect on the European customers. Every brand has its associations that strengthen its influence. The statistics shows that 72% of European citizens prefer classic, elegant and glamorous items. 58% of European citizens prefer relaxing, comforting and pampering. It means that European customers pay too much attention to the brand images.

Kotler states that branding is a term, name, sign, design or symbol that is associated with the company, its services and products. Branding has many functions. First of all, it targets market and makes the company more competitive. Secondly, it defines the future perspectives of the company. However, its main role is to facilitate the implementation of the integrated marketing communications mix and design.

Brand awareness is when a customer is familiar with the company, its products and services. Brand awareness proves the relationship of the company to the customers. Brand awareness consists of brand recognition and brand recall. Brand recognition includes customer’s knowledge and competence related to a specific brand. Brand recall is an ability of the customer to recall the brand from his/her memory (For example, logo of Apple’s brand).

Branding is crucial for marketing strategy of the company. First of all, a good brand is a basement for the achieving of objectives and goals and delivering the message clearly to the customers. Secondly, branding proves the credibility of the company and motivates the customers. Thirdly, branding strengthens user loyalty and connects target prospects. A recognizable brand of a product adds the value to the company and its marketing strategy. However, it is essential for the company to create brand equity for all services and products. Brand equity makes the products more superior in reliability and quality, easy recognizable and memorable.

The integrated marketing communications use mass marketing campaigns to create brand equity. If the customer wants to pay more for a branded service or product, brand equity will be positive. Another aspect necessary for marketing mix strategies is brand awareness that one can strengthen through creating a reliable brand image, taglines and slogans.

Market Environment Review

Speaking about industry driving force of Apple Inc., it is necessary to say that it is a right choice of strategy that provokes development and innovation of the company. One can define a corporate strategy as a driving force of Apple Inc. The key aspects of corporate strategy can be listed as follows: strategic management, creating of shareholder value, realizations of potentials of the company and individuals and strategy of diversification. Apple corporate strategy includes diversification of business, making hospitability business dominant and constraint diversification.

Apple Inc. brings the best gadgets to the different customers (students, businesses and government agencies, educators). Their business strategy is based on their unique ability to develop and design their own hardware, operating systems, services, application software, etc. One may make a conclusion that they do not copy anything from their competitors, they try to be unique and original. Their continual investment in development and research is the way to continual success.

At the present time, there are companies specializing in new technologies and gadgets

and that is why Apple Inc. has many competitors. Windows, Android, Blackberry, Sony, Dell, HP, Toshiba, Acer, Asus, Samsung, Nokia are the main competitors of Apple Inc. All these companies are among the most recognizable companies that offer quite similar services and products. Without doubt, the consumer chooses that is not very expensive is comfortable and satisfies his/her demands (Jeannet, J-P & Hennessey 2001).

Political, sociocultural, economic, technological, legal, environmental aspects define the macro environment of Apple Inc. Tax obligation and following legal regulations are political factors that have an impact on Apple. Economic aspects of the organization include buying power of consumers. Changes in selling and buying define profit rate. There is a direct relationship between shifts in the international economy and Apple position at the market. Inflation, unemployment and exchange rates are crucial for the economic state of the organization.

Such demographic issues could occur in Apple Inc. as a result of decreasing of consumers buying power and aging population. Such issues can cause decreasing in profits, selling and demand on their products. Political issues of Apple Inc. are connected with opposition of Apple with Samsung over patents and desire of Apple to mitigate American taxes. Economic issue of Apple Inc. is connected with the recent recession in selling. Sociocultural issues of Apple Inc. are connected with consumers environmental concerns, creating of new devices by other companies and outdating Apples products. Technological issues are connected with rapid changes in technology and becoming of Apple’s products obsolete.

Company Strategies

Apple Inc. has well-promoted brand that is able to compete across the competitive markets. The branding strategy of Apple Inc. is to develop their personal computer industry and the consumer electronics industry. 393 retail stores in 14 countries, occupying the third place after Samsung and Nokia in production of phones prove the development of global strategy of Apple Inc. New products like the All-new iMac, iPad 4, iPhone 5 and iPad mini prove future perspectives of the company. Increasing of profits by 24% shows the financial development of the company and that is why it can be admitted that the company is at the peak of success.

A recent study by Barney (2012) involved financial strategy of Apple Inc. as a right one. As a result the company gains positive experience and its profits are high. For example, in 2012 with profit $622 billion Apple got the status of the most valuable company. 26.9 million iPhones were sold in 2012. Apple sold 14.0 million iPads, as well. Such figures are exciting and prove the progress. However, Apple Inc. should also take into consideration high prices as they may reduce the number of consumers.

Apple Inc. uses sleep product design, easy-to-use software, innovative hardware for attraction the customers from all over the world. Regarding the driving force of the brand, it can be stated that it is a fact that Apple Inc. belongs to the private sector. That is why it can avoid many pressures attributable to the public companies. In their management, they had chosen such categories as the dedication to sustainability, the level of customer service, the innovation and creating of new technologies (iCar, iTV, iWatch, etc.).

The target market of Carlson Company Inc. includes consumers of all ages. However, the most active consumers are teenagers and young people who prefer innovative gadgets. Apple is also popular among people who prefer using innovative technologies for business.

The people who spend too much time working use the services of the company in order to unwind and entertain. The consumers of Apple are active, successful, single or married, raising families or lonely. Current consumers of Apple tend to live in Eastern Europe or in the United States. However, the companys future goal is to target consumers in other parts of the world. Apple does everything in order to satisfy their customers needs.

Apple Inc. is characterized by such tangible resources as retail locations, well-fortified and global supply chain, tailored hardware and software system and massive technical patents. Indeed, all their competitors also possess such resources and that is why Apple cannot suppose all the tangible resources to be their weapon against the competitors. The main weapons of Apple against their competitors are intangible resources: Steve Jobs vision, patents, talented software development team, industrial design capability and relations with original equipment manufacturers. Such resources are not always appropriate for winning, but Apple managed to use them for personal benefit.

High-quality services and knowledgeable staff of Apple are the indicators of good human resource management. Innovative products and technologies are the results of good performance and knowledge management. There is no doubt that such factors as country of origin and foreign and domestic predispositions also have an impact on the development of the business. The country of origin factor of Apple creates a positive image. It was originated in the USA. The product strategy is to offer innovative services. The distribution strategy is to shift from regional and local markets to the international one. The promotional strategy concerns communication with consumers to identify their preferences. It also includes collaborating with competitors in order to learn their marketing strategies.

Apples branding strategy is related to the emotions and feelings of the customers. Moreover, they associate their brand image with power-to-the-people, aspirations, dreams, hopes, passion, innovation, liberty regained, imagination and lifestyle technologies. Brand personality of Apple struggles to making people’s life easier and more comfortable and simple. They achieve such objective through a heartfelt connection with their clients and people-driven product design.

One can say that Apple has high market share and sales due to the strong brand awareness. Their customers are willing to pay more not only for the quality of the products but for the positive brand equity. Marketing communications mix provides a sense of community between the company and users that leads to the brand loyalty.

The benefits of Apple as a branding company refer to the emotional appeal, familiarity, memorability, premium price and image, extensions, loyalty, lower marketing expenses and greater company equity. Emotional appeal targets customers’ emotions with product names. Familiarity and memorability prove the company’s reputation at the market. Style, colour, design and logo are the main indicators of the brand familiarity (Scott 2011).

Marketing communications mix strategy is aimed at identifying, understanding and satisfying the customers needs. Marketing explores what people want and then gives it to them. Marketing is responsible for exploring the needs of people, planning the quantity of products and amount of services, pricing, choosing packages, promotion of the produced products and services and the final processes of selling and distribution. At the present time, many domestic companies strive to enter the international marketing arena. The strategies for the Apple marketing are:

Expensiveness. High pricing always proves high quality of the item and brand name.

Association with any fascinating story. It is important to associate the name of the brand with some story. It helps the customer remember the brand and provokes an interest.

Satisfaction of the customers needs. It is important to explore the customers interests and needs in order to create suitable items for them.

A suitable placement. It is necessary to locate luxury stores in the places where there are many people.

Creating comfort. One should propose luxury brands creating comfort, being unique and original.

Marketing communication mix strategy is based on the four main strategies: pricing, promotion, distribution and product strategies.

1. Product strategy. Apple Inc. develops their variety of products and adapt to the international market. They offer the innovations of technologies.

2. The distribution strategy. Apple Inc. transfers from regional and local markets to the international ones. Integration at the global market is a new way to development. At the present time, Apple Inc. wants to win the markets of India and China.

3. The promotional strategy. Current aspect is aimed at satisfying different customers needs and at attracting different consumers from different countries. It proves globalization of marketing and finding customers from all over the world;

4. Prising strategy. Prices are premium at the company (Subhash 1996).

Conclusions and Recommendations

The main ingredient of a successful strategy of Apple is the ability of the advertisement managers to find the most reliable ways of attracting customers and working with mass media. The technology industry is a highly successful and competitive business. One can distinguish four main components of its success: reputation, monopoly, architecture and technology. The beneficial economic situation in Europe and the USA allows customers to choose what they want to wear despite high prices. People from poor African countries, on the other hand, cannot afford food, education and medicine. Therefore, it is not surprising that they are not knowledgeable in the technology brands. The objectives of the advertisement managers of Apple are to use cooperation with other brand companies, strengthen the power of the brand on a global level and develop business in all parts of the world and design coordinated and global brand strategy.

For improving the integrated communications mix strategies Apple should use various surveys to determine the level of customers satisfaction. It means that the company is interested in high quality of its services and products, as well as customers satisfaction. Apple should orient on the global market development. The company should follow a global strategy that is aimed at offering products interesting for customers from all over the world.

Apple should open new service centres and improve product quality. Customer should be at the first priority and that is why it should satisfy their personal desires concerning innovative technologies. Apple should pay more attention to fast services and collaborate with companies regarding innovative technologies (Nokia, Samsung). Apple has a valuable opportunity to develop the services that will be advantageous and innovative. Production strategy of the company deals with creating of new locations for its innovative services. Consequently, the company builds capacity with demand and, as a result, it has not evident losses but very high profits. One recommends opening more locations, streamlining, launching new products as the ways for winning the international marketing.

Apple should have a competition-based pricing. One recommends offering a flexible system of reductions. Apple should be sensitive to competitors’ prices and offer better products with similar prices to competitors as it will attract more customers. The pricing strategy has to reflect the value of a service or product. In detail, the value of the product should determine if the quality provided falls on a higher or a lower budget product scale.

Apple should look for the new suppliers as new supply chains will benefit the production of more qualitative services. Integration into the global market is a new way to development. Apple should communicate with the clients in order to know their tastes and to collaborate with competitors in order to reveal their marketing strategies.

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