Apple’s new iPad Marketing Plan
Made by: Vu Tien Thanh
Although facing fierce competition from other companies, Apple is still indisputably at the top of the tablet market (54.7% market share in the 4th quarter of 2011). The company has sold nearly 33 millions iPad 2 in the year of 2011. On March 7th 2012, the company launched its “new” iPad (3rd generation) for this year. This report aims at the marketing analysis for the Apple’s new iPad. As committed, new iPad is the upgrade of previous iPad 2, designed to bring the best user experience to its customers through its innovative hardware, software, peripherals, and services. Apple continues to use the same pricing strategy for the new iPad while reducing the price for iPad 2 (from $499 to $399) to put it into direct competition with those middle-range tablets of Amazon or Samsung. It has also been decided that Apple should focus the demographic segment in general but more specifically be targeting their product primarily to the 25-44 years old age group along with the secondary targets of 13-24 years old and 45-54 years old or older. The company uses a variety of direct and indirect distribution channels for iPads, such as its retail stores, online stores, and direct sales force, and third-party cellular network carriers, wholesalers, retailers (BestBuy, AT&T, Verizon, etc.), and value-added resellers with the purpose of expanding its distribution network to effectively reach more customers and provide them with a high-quality sales and post-sales support experience. While the company is widely recognized as a leading innovator in the markets where it competes, the tablet market is highly competitive and subject to aggressive pricing. To remain competitive, the company believes that continual investment in research and development is critical to the development and sale of iPads. In addition, by cooperating with other prestigious companies such as Facebook or Starbucks and implementing promotion strategies via multi-channels, the company aims to sell 65.5 million iPads ($42.6 billion revenue estimated) by the end of February 2013 while maintaining dominant share (60%) of the growing tablet market.
Cooperative environment. As of January 2012[update], Apple has opened 361 stores worldwide. The Apple Stores have been responsible for turning the boring computer sales floor into a sleek playroom filled with gadgets. The iPad is assembled by Foxconn Technology Group, which also manufactures Apple's iPod, iPhone and Mac Mini, in its largest plant in Shenzhen, China. Currently Apple’s biggest manufacturer Foxconn is experiencing some serious problems. Their work labors get low salary, work in poor working conditions and always work overtime. The Fair Labor Association group tasked with auditing Foxconn has found a “ton of issues” that need fixing, according to a report from Bloomberg. These problems may affect Apple’s reputation. Competitive environment. Although Apple is still indisputably at the top of the tablet market (with 54.7% market share in the 4th quarter of 2011), but the “new” iPad will face a host of competitors that are clamoring after their own little niches. The competition can be divided into two categories: direct and indirect competitors. The major direct competitors of the new iPad are: Amazon Kindle Fire (16.8% market share), Samsung Galaxy Tab 10.1 (5.8% market share), Barnes & Noble Nook Tablet (3.5% market share). The other tablet-competitors, which in one way or another, distinguish themselves from Apple’s gadget are: Acer Iconia A500 (more memory than the iPad and more ports), Motorola Xyboard (better camera than the iPad), BlackBerry PlayBook, Sony Tablet S, ASUS Transformer, etc. (See Appendix) The main indirect competitors for Apple new iPad are desktop computers, MP3 players and smartphones. The iPad’s advantage over these products is that it offers...
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