Apple, and its iPhone are very established brand names in the smart phone industry in today’s US market. As the early leader and innovator in the smart phone market, Apple was able to stay ahead of its competitors by releasing new iPhone versions every year, and software updates whenever necessary. Expansion internationally was not as fast as domestically, thanks to heavy competition from industry giants like Nokia, the world’s biggest producer of cell phones. Currently iPhones are being sold in over 88 countries, though Apple still controls the manufacturing process for all iPhones shipped worldwide. Apple retail stores are only present in 35 of those countries, with Apple product presence in other parts of the world being represented by third parties. Singapore is one of the countries that does not have an Apple Store, and as recommended in my last report, intensifying penetration into that market can generate more revenues and lead to better strategies being tested for when the market in China matures enough that entrance is viable. People in Singapore are not avid Apple consumers as the company does not have a presence in the country yet, and as far as the iPhone goes, there are options that suit the needs of the population interested in smart phones better. Marketing
Export Marketing should be used in order to gain entry into the Singaporean market. Using the same strategies and marketing mix that were used in the United States and Europe will not allow Apple to gain any advantage in this market, much like what happened in Japan when the iPhone was introduced. Export marketing is defined as “using the product as a starting point and modifying it as needed to meet the preferences of the international target markets.” When Apple introduced the iPhone in Japan, it used most of the same strategies it used when introducing the product in the US: showing it off as being innovative and something new, and just plain better than everything else available in the market. However, that is not true in the Japanese market, which is comprised of users that are very technologically savvy and want the newest and most powerful gadgets. Nokia’s line of smart phones and camera phones fit that exactly, and even though they’re priced much higher than the iPhone, Apple’s product did not gain traction in that market, even after being offered for free with a 2-year contract. Changing the marketing mix and marketing strategies could have changed that scenario and made Apple gain much more market share in Japan, which is the goal in Singapore. Singapore’s market is very similar to the one in Japan, where users understand what they are buying and are able to make informed decisions about the product. Furthermore, both cultures are very family oriented with high morals, so commercials need to focus on those two facets of Singaporean life. Below are some of the Market Entry Strategies I considered:
Licensing involves allowing a third party to use Apple’s trademarks, manufacturing process, and trade secrets in exchange for royalties paid on revenues. This goes completely against Apple’s company culture of in-house production and vertical ownership of the manufacturing process. Joint Venture
A joint venture is a legal entity formed between two or more parties to undertake economic activity together. While there is some risk involved in this mode of entry, there is less capital involved than if Apple were to use the same mode of entry it used in Europe, where it assumed all the risk and reaped all the rewards. Once again, however, it goes against the vertical ownership of the manufacturing process. Partnership
A partnership is when two companies agree to share the profits or losses in a business. I advise that Apple contact one or more of the local telecommunications providers and start a partnership with them to market and sell the iPhone in Singapore, much like it did in the United States with AT&T and now with Verizon. This...
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