Ipod Marketing Plan

Executive Summary

The focus of this report is on marketing plan for Apple Ipod product that has created increasing demands in various outlets. This product allows consumers to download not only their favorite’s music but also books and other literature which can be read and listened to. Additionally this Ipod can be used in your car and in other mobile settings. This report is for Apple to give a brief description of this product. Within this marketing report there is an insight of the situation analysis of this product, marketing objectives, the target market, marketing strategies that have been used and the forecasted strategies, monitoring and controlling.

. Objectives of project . We will elaborate on the Situation Analysis of Apple Inc. as our case study. Following this, we will analyze and explain how Apple Inc. is able to remain their competitive advantage with their comprehensive knowledge of their products and the satisfying of the demands in the market despite the cutthroat competition from other companies.

1. Mission statement of Apple Inc.

“Man is the creator of change in this world. As such he should be above systems and structures, and not subordinate to them." (Apple Inc’s Annual Report, Apple Vision, para 2) Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and internet offerings. They take pride in its history of innovation and thoughtful design. Apple is not just the leader of innovation engineering but also has environmentally relevant substances, create recycling programs worldwide and improve energy efficiency. They set high standards based on their own requirements and those set by programs such as ENERGY STAR® in an effort to create products that offer excellent environmental performance throughout their life cycle. “The path for Apple going forward is to look beyond existing market models and anticipate demand in the long run.” (Apple Inc’s Annual Report, Path Ahead, para 6)

2 Situation Analysis

a. Internal environment Apple was established in Cupertino, California on April 1, 1976 and incorporated[1] January 3, 1977. It is an American Multinational Company (MNC) with a focus in designs, manufactures and markets personal computers (PCs) and related software, peripherals[2] and personal computing and communication solutions. (Wikipedia Encyclopedia, Apple Inc, 2008, para 1) On January 9, 2007, Apple dropped “Computer” from its corporate name to reflect the company’s ongoing expansion into the consumer electronics market in addition to its traditional focus on personal computer when it first started out. For various reasons, Apple has created a unique reputation in the consumer electronics industry. This includes a strong customer base, particularly in the United States, that is unusually devoted to the company and its brand. Today, the company continues to lead the industry with its award winning personal computers and iLife and professional applications. Apple is also leading the digital media revolution with its iPod portable music and video players and iTunes online store, and has entered the mobile phone market this year with its revolutionary 3G iPhone. b. External Environment

i. Markets The Ipod was launched in October 2001, and between 2001 and 2004 Ipod sales were between 100-200 thousand units per quarter, very far from today 's 10-20 million units per quarter, and the Ipod sales were not even covering the product research & development costs. Then, in June-Aug 2004 something happened, and Ipod sales began to grow strongly, quarter after quarter. Today, we all know where the Ipod stands, and what a remarkable success it is.

ii. Competitive environment Competitors will regulate what, when, how and why strategies will be adopted. The introduction of new products will greatly influence Apple Ipod.

iii. Economic environment Despite of the current economic environment, Apple Ipod continues to unleash new level of innovation that keeps Apple years ahead of all their competitors.

iv. Demographic environment Males and females from the age of 12 years and over will be in favors of this product because of its new innovation to be able to not only play music but also books and other literature which would in fact appeal to them

v. Technological environment Technology must be adopted to improve overall efficiency. It must be integrated directly into operations (to increase productivity), as well stay on date with the amounts of Ipod’s ordered, made and delivered.

c. SWOT Analysis Strength • There are enough financial resources that are allocated for the operation of this product • Appealing to both males and females • Good competitive skills • Past products have had a good reputation • Advanced key technology • Product innovation skills

Weakness • The product has a narrow line therefore unable to expand into other markets • High prices may push potential customers to competitors with affordable prices • Introducing a new product, when the niche market is already controlled by other competitor’s • Poor use of promotional strategy, as consumers were not properly introduced on the products significant use

Opportunities • Opportunity to capitalize financially • Develop an admirable goodwill that can have monetary value in future • Opportunity for fast market growth as parents may see this as an educational device as it is able to read books • Growing market trend

Threats • New competitors continually enter the market • Entry of imitators • Vulnerable to the business cycle • Tough laws being placed on internet MP3 downloads

Trend Currently, we are in a technological world, therefore people would go for more trendy gadgets like Apple Ipod.

Critical Issues People need to be educated on these products. When use in the right time, it can definitely give people the best entertainments.

3 Marketing Objectives The various marketing objectives that will assist in the achievement in the overall product goal are • To be the leading supplier of MP3 players in all markets in which the company operates • Increase in sales by 20% • Increase in revenue by 20% • Progressively increase market share by at least 15% within a year • Expanding distribution to department stores by 10% • Increasing brand awareness to 60% of potential customers • To expand existing markets by 10% in the next quarter. • Promotion campaign will be introduced to encourage present buyer to increase the use of the product
4 Marketing Strategies

Target Markets
Apple Ipod has adopted the differentiated market for their products as its products are characterized in age, gender and desire for image. Apple Ipod is used by young adults and teenagers as well as for both males and females

Product Strategies
As any reputable gadget company, Apple Ipod allows consumers to download not only their favourite music but also books and other literature which can be read and listened to. Additionally, Apple Ipod can be used in your car and in other mobile settings.
Apple Ipod has positioned their products aimed at middle to high class; therefore product will be positioned in departmental stores associated with prestige products. This will create a strong, clear and consistent image of the product in the consumer’s mind which is essential.
For branding, Apple Ipod will give consumer’s one year warranty to assure consumers of the quality of the products, this will therefore associate a level of quality with the brand and will not only increase brand loyalty, and repeated services, but also sell products at a premium to competitors.
In packaging, Apple Ipod will have their product identification so easily separated from its competitors, product differentiation so is unique and using the most cost efficient method of packaging. Therefore this will make the product both functional and desirable to possible consumers.

Pricing Strategies
Apple Ipod will use cost base method to derive its prices, they will add a 65% profit margin to the cost of the product to gain efficient revenue. In fact, most if not all, of the discounted prices of Appe Ipod products found on the net and around, were given by their authorized distributors to remain more competitive. Without their own physical store or franchise, the majorities of Dymatize’s profits are generated from sales to distributors and authorized retailers. For this kind of transaction, bulk discounts are a common incentive, and this allows the distributors to pass on the discount to end consumer, hence the cheaper price than what Apple Ipod themselves are selling direct.
However Apple Ipod does offer a significant discount to the public consumer when it is a purchase made for their package consisting of the whole range of their essential products. Similar to pricing strategies where customers are enticed to buy more with discounts that come from multiple buys (e.g. “50% off 2nd item” promotions), this particular pricing promotion is supported by the implied promise of better results through use of the company’s key products.

Promotions Strategies

Apple Ipod utilizes a few promotion strategies commonly used by companies in its industry, namely through advertising and magazine. By promoting the Apple Ipod, this will satisfy the needs of the customer’s and business. Consumers will gain better understanding of the product and how it can satisfy their needs, but on the other hand will help Apple Ipod increase their profits and market shares.
Apple Ipod is widely advertised in gadgets magazines. The rationale to purchasing advertising space in these publications is because the readers of these magazines are the most motivated to buy products and thus easier to be influenced, as compared to a very likely much lower chance of response to if it was advertised in the newspapers despite reaching out to a much bigger reader base. Apple Ipod will spotlight on a successful advertising campaign comprising of magazine and television advertisements focusing on the target market, how often they want the target market to be exposed to the advertisement, when they want to reach their target market and most cost efficient methods to fulfill the above. By doing this Apple Ipod will add value to their products by altering consumer perceptions.

Distribution Strategies

As mentioned before, the company does not have “brick and mortar” stores or any such franchise. Their use two main channels of distributions – by selling direct or through distributors.
Most of the sales come mainly from dealing with intermediaries (distributors and authorized retailers) who will then stock and sell their products. This is actually a common practice, due to its inherent advantages of passing on the burden of storage and ease of establishing office in various geographical locations without the need to specially invest time or resources.
In Singapore, Apple Ipod will fragmenting bulk supplies of inventory, Instead of buying floor space to open up a nutritional boutique; it is more effective to use this type of distribution channel where the distributors are best positioned to sell the product to people who will be more receptive.
Apple Ipod also sells their products direct over the internet. Information for each and every product is available on the official website, and consumers can select the items they want before making an online purchase. The biggest advantage is that this allows them to reach out to markets where distributors are absent, plus it is a convenient way for their customers to shop behind a screen of anonymity.

5 Budgets, Financial Data and Contingency planning & control
Developing a Financial Forecast, we need to achieve a healthy and continuous growth in profit thus to be able to attain a 15% increase in market shares within the annual and achieve positive growth in the sales of the product. Financial forecasting 2009 2010
|Revenue |S$16,800 |S$16,800 |
|Cost | | |
|Fixed costs |S$9,350 |S$0 |
|Variable costs |S$6,670 |S$6,670 |
|Total costs |S$16,020 |S$6,670 |
|Net profit from marketing activity |S$780 |S$10,130 |
|Return on market investments |5% |152% |

6 Recommendations for Change
After six months have elapsed we have found that we need to change our marketing mix strategies to fix the above problems. Apple Ipod received a decrease in sales, it is suggested that Apple Ipod change one of the marketing strategies to solve the problem. Apple Ipod should have introduce a public relations scheme to improve the relationship between company and their markets, rather than advertising which is aimed at improving the public image of Apple Ipod, public relations is aimed at increasing a business’s sales.
In order for Apple Ipod to gain competitive advantage and increase market share, we must readjust the marketing strategies. It is advised that Apple Ipod add an extra feature to the current product. A new innovative feature that may consider is cordless earphones that send the sound via Bluetooth technology. This will differentiate the product from current competitors and result in an increase in market share.

7 Conclusion
Throughout the project assignment, we have shown how our group has managed to research on the product and development that Apple Inc. has adopted that has capitulated their success which won a huge size of the international market with its product.
Apple takes pride in its history of innovation and thoughtful design. But technological leadership goes beyond what’s in the box.
Our project assignment has covered the Marketing Plan takes of Apple Inc. that they adopted in their organization and how they have managed to remain their competitive advantage with their comprehensive knowledge about their products via the extensive usage of product research and development and the satisfying of the demands in the market.

Bibliography
|No. |Resource Title |
|1. |Gil Amelio, William L. Simon (1999), On the Firing Line: My 500 Days at Apple |
|2. |Jim Carlton, Apple: The Inside Story of Intrigue, Egomania and Business Blunders |
|3. |John Sculley, John A. Byrne (1987) Odyssey: Pepsi to Apple, Harpercollins |
|4. |Owen Linzmayer (2004), Apple Confidential 2.0, No Starch Press |
|5. |Rob Price (1987). "So Far: The First Ten Years of a Vision". Apple Computer. |
|6. |Steven Levy (1994), Insanely Great: The Life and Times of Macintosh, the Computer That Changed Everything |
|7. |Apple Inc. [On-Line]. http://www.apple.com/environment/ (11 September 2005) |
| |Apple Inc. [On-Line]. http://www.apple.com/supplierresponsibility/ (12 August 2006) |
|8. |Apple Inc. [On-Line]. http://en.wikipedia.org/wiki/Apple_Inc (19 July 2008) |

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[1] Incorporate: to form into a legal corporation.
[2] Peripheral: related to, located in, or constituting an outer boundary or periphery.

Bibliography: |4. |Owen Linzmayer (2004), Apple Confidential 2.0, No Starch Press | |5 |6. |Steven Levy (1994), Insanely Great: The Life and Times of Macintosh, the Computer That Changed Everything | |7 | |Apple Inc. [On-Line]. http://www.apple.com/supplierresponsibility/ (12 August 2006) | |8