Macro Environment and Marketing
Apple Inc Company, started by Steven Jobs, Steve Wozinak and Roynald Wayne is 30 years old now; Steven Jobs is the man behind this successful company. Apple has expanded from computers to consumer electronics over these years and lot of changes has occurred during these periods, which obviously happens in any creative industry. In the month of January 2007 the name was changed from Apple Computer Inc to Apple Inc Officially. Some of the products of apple over a decade are power Mac g4 cube, I pod, Mac book pro, I phone and the latest one is the I pad.
Vision statement & Mission Statement of Apple Inc
Vision Statement: "Man is the creator of change in this world. As such he should be above systems and structures, and not subordinate to them."
Mission statement: "Through its creative hardware, software and internet offerings apple is to bring the best computing experience to students, educators, creative professionals and the consumers."
Universe of sociological elements that affect a company's ability to serve its customers or sell itsgood and services. It's important factor for an organization, All these major factors are to be considered like suppliers, marketing intermediaries, customers ,competitors, and publics all operate in a larger external environment. Macro environment says about the threats and making the correct decision making to improve their business.
There are six major forces together that form the complete macro environment and they are
1. Demographic environment
2. Economic environment
3. Natural environment
4. Technological environment
5. Political environment
6. Cultural Environment
The most primitive factor is the Demographic environment; Marketers are keenly interested in the World's population, the human population in terms of size, density, location, age, gender, race, occupation , mobility trends, birth, marriage ,death rates ,racial, ethnic and religious structure.
Apple was established in Cupertino in California on April 1st, 1976. They started with computers first which was a competition to Microsoft company. Slowly they made their expansion into consumer electronics. It has made a transition to provide products like personal computing, portable music players, and communication devices and also develops many software applications. Apple has a count of 36,800 employees totally out of which 34,300 are full time employees and 2500 are temporary employees. Total of 273 stores are there worldwide out of which 217 is in the United States and rest is internationally based ones. Majority of the people who use apple products are the whites.
The main area of business of apple products is in the UK and the US. The business will be spread very soon in Indian markets. Because many people are using apple products in India.
In the marketing system economic environment plays a major significant role. It is concerned mainly about the consumer purchasing power and spending patterns. According to high economic growth assures higher standards of employment and income, which leads to marketing boom in many industries. Marketing plans are influenced by many economic items such as current income, prices, savings and credit. The major trends of income and consumer spending in the market should be known to the marketers.
The economic factors of Apple Inc revenue in 2008 was less when compared to 2009. The revenue growth of 2009 was projected to increase by 10%. The sales of I phone and I pod increased enormously during this period. The iPod has contributed majorly for apple computers. The sales of personal computers decreased about 8% in 2009. They have updated the software's in new iphone. Apple tv which was 40gb has been changed to 160 gb during sept 2009. They upgraded the imac by replacing the cold cathode fluroscent lamp with mercury free LED. These frequent changes in the products made the consumers to buy more.
Deteriorating the environment is one of the major issues facing the business and public people. Air, water, and noise pollution has reached dangerous levels in many cities. Green marketing has been increased in quiet and simple manner everywhere in the world. The surroundings must be kept clean and green, raw materials and resources should not be wasted. The four main factors of natural environment are as follows
1. Inadequacy of raw materials
2. Increased cost of energy
3. Increased levels of pollution
4. Environment protection
Since 2006 Apple inc has set and met the important goals to reduce the impact on the environment. Every product which is shipped has assessed the full life cycle of green house gas emissions (GHG). Green house gas emitted from the production, transport, use and recycling of products is over 95% and the rest 5% is used for facilities. Everyday operations and environmental impact is managed carefully by apple. Energy consumption by them is reducing year by year to control carbon emissions foot print. Apple has introduced a renewable energy in the year 2008 which has converted 100 % of energy to renewable sources. They have introduced recycling and composting programs to reduce the waste. Continuous environmental, health and safety managements are done to improve the product, process and services.
Innovative ideas create a new product, changing the old product by updating new software's. Factors and trends related to innovations that affect the development of new products or the marketing process. New technologies make the consumer's to buy the product imperatively. Advanced technologies can bring forth latest industries, gives rise to new business and advance products for existing business. New technology factors can also create negative sides for business. To improve their positions marketers should constantly monitor the vocational environment to look for better opportunities.
Apple inc is mainly dealing with computers and electronic gadgets so technology plays an important role. They update their software's regularly so people tend to buy the new version one. In the year 2009 apple has updated many specifications like, desktops and mac notebooks earn epeat gold status, mac mini, imac and mac pro has met the energy star 5.0 specification, mac book pro has been updated by built in batteries and iphone 3GS has a power adapter which performs global energy efficiency standards.
Apple inc is Planning to introduce the latest mobile device - Ipad which is something very thin and has multi touch screen where you can experience the web, email, photos and videos within seconds. It is very convenient to handle also. Mostly all the functionalities will work in any orientation. This way you can check your mails, messages and chat with your friends immediately.
The political environment consists of the laws, government agencies and pressure groups that influence and limit various organizations and individuals in society. The social and economic environment is related closely to the political one. Some of the issues you must know are , what is the governments perspective on the economy, culture ,religion and finally on marketing ethics .
Apple has invested approximately $ 580,000 since 2002 for political activities. The Cost cannot be determined exactly because reporting at the state level is incomplete and can be misguided. It has failed to publicly disclose its political contributions. It is a member of the retail industry leader association (RILA) acts as a solicitor for the retail industry. They are main members of American electronics association (AEA) .It represents mainly the technology segments, because apple is dealing with sophisticated electronic equipments.
By doing this it modifies the governments at the state, federal and international levels; business opportunities and capital access are provided, Offering several business services and networking programs.
This environment is mainly concerned about the people's behavior and trends, cultural factors like values, ideas, attitudes, beliefs and the population of subgroups which affects consumer's purchasing behavior. The cultural characteristics and trends in different markets must be carefully understood by the marketers.
Apple inc targets the younger generations with more advanced technologies .The I phone, ipod and mac computers are spread worldwide. The company's target includes almost all sectors of the society, for younger and the older generation. They have designed the gadgets software's and colors according to it. This kind of target market is larger sources of income. Most of them in the UK and the US are using apple inc products from ipod to the iphone. Hope in forthcoming generations it will be the ipad.
This analysis is done after the PESTEL analysis. It tells about the External environment impact on the strengths, Weaknesses, Opportunities' and threats that affect the business. Strengths and weaknesses are internal factors. Opportunities and threats are the external factors
Strengths of apple inc are the speculations are given in detailed, Delivery to the customer is done perfectly in a controlled retail experience like apple store. Customers prefer apple inc products because of the quality and service they provide.
The weakness of apple inc is the cost which is very high for research and development when compared to other laptops like dell, hp etc..The unit sales will be limited because they never compete at the bottom end of the market.
Opportunities of apple where I phone and virtualization can be re-entries to corporate market. I phone has been successful in corporate market by developing multiple price points.
The close competitor to the apple is Microsoft. Microsoft is good in the dominant PC operating system player it could stop the market shares. Microsoft has refined many OS from the XP to vista and now it is windows 7. OS 7/8 was one of the major disasters.
To make a business achieve its objectives by marketing its products with different kind of strategies and services effectively to different consumer groups. The 4Ps plays a major role in any kind of business they are Product, Price, Promotion and Place. In addition there are 3Ps People, Process and Physical Evidence is called has the extended marketing mix. Any concern needs to make sure they are marketing the right product to the right person at the right price in the right place at the exact time with the necessary promotions. You should identify your target customer groups.
For example: If you are taking bags and decided to target children's of school and college, it would be appropriate to market
Different designs of bags (Product)
At a moderate rate (Price)
Selling at stationers places (Place)
Promoting some products with discounts (Promotion)
Product Life Cycle:
Product means tangible or physical items you are selling to the consumers. Marketing is about identifying, anticipating and satisfying customer needs. Product can be characterized by its means, materials, form and functions. A product will consist of a brand name, packing, service, maintenance and warranties. There are 3 levels of a product;
The core product: Which is tangible and it is actually to satisfy the needs of the customer.
Actual Product: The product is defined by such things like color, style, branding and fashion and how people are purchasing it.
Augmented product: All the services offered after buying the product like warranties, guarantees, customer services and installation services.
To keep the customers interested you should make clear that creating innovative products is becoming increasingly necessary for business. So consumers prefer apple Inc products. One of the booming industries in the world is mp3 players. Apple Inc has become popular in this market category. They are the innovators in the mp3 industry. Some of the hardware products include Macintosh computer, I pod, I phone, latest I pad and many more. Apple has created more portable devices where in the user can watch movies and videos through it. Through the use of proper strategy and varied opportunities, apple has achieved rapid growth and development within a short span of time.
The website of the company has all the support services which is available for the clients. If the product is not functioning properly the client can check it on the website and fix the problem. Consumers can get the helpful information about the product and can also download support systems. Company has different services centers all over the world.
According to the consumer point of view, price is a substantial factor. Value of the product or service at the market which is fiscally expressed is known has price. The price must be fixed according to the products quality and brand. Price fluctuates in certain periods which are done according to the market value. This P of marketing mix plays an important role in business because it tells about the revenue generated. To be stable in a business you should study about your competitor's price
Apple inc has a standard price for most of their products. They are targeting brand loyal customers. Fluctuation of products is done very rarely. Different market segments has various prices, clients will have lesser doubts about taking a look at the company's product and the products that they can afford. The starting price of Mac book is from £816 is expensive when compared with other laptops. They have lot of good features when compared to others. When you are comparing the zune and the ipod, zune does not have WAV uncompressed and Bmp Photos file compatibility. They have the feather touch facilities and its very easy to handle. Services are done for free for a particular period of time. This is one of the major reasons many people choose apple products. Apple products range starts from ipod shuffle -£46 to the expensive mac pro which is £1940. Customers know about the product standards and the services that are available. The 16gb ipad which is the latest gadget ranges from 499 -899£. Customers will be definitely satisfied with the price, because they are getting the latest technology product with more features in it.
Place is also known as channel, distribution or intermediary. It is the means of distribution on the product which you select or service you are marketing. Pricing and promotion decisions will impact on your choice. Product can be sold through wholesalers and retailers. Distribution must be done in an effective and efficient manner in order to meet the marketing objectives. Two type of distributions they are Indirect and direct distribution. An Intermediary is used like the wholesaler and then to the retailer in indirect method. In the direct method dealing is directly done with the consumers and manufacturers . Intensive distribution is used to sell low price products. Exclusive distribution takes place in a single outlet and the product is highly priced. Selective distribution is where consumers are willing to shop around and small number of outlets are selected to circulate the product
Apple inc products can be reached to customers through net by online purchasing. They use a very diverse distribution mix. The products can be purchased from apple directly. Products are available through various channels. Some of the online resellers are Amazon, eBay, Wal-Mart, cellular and electronic retailers. Apple has 286 retail stores worldwide and the latest one is opened in the New York City. The largest apple store is in regent street London. In India, Reliance retail has opened istore. Apple follows both distribution strategies like exclusive and the selective one. They have opened 31 stores in the year 2009, the first one was opened in village located in downtown and the last one was in Bristol at cribs causeway on Dec 12th. Apple is going to open many stores in the future and the rough figure is about 70 specific locations.
Promotion is done by communicating and explaining about the product uses to target customers. It is mainly made up of these factors like advertising, sales promotion, public relations, direct marketing and personal selling. By doing lot of promotions the customers can be updated about the products and also know the value of it. This activity takes place in the initial stage of marketing, for the customers to be familiar with the product. The communication process must be conveyed properly to the customers end and the promoter should get a feedback. With the feedback they can analyze and improve their strategies. The concern should start with the identification of prospects and customers should be kept informed what is happening and how the staffs are handling customer complaints.
Apple inc uses many promotional methods the main is through advertising including the internet (website, banners and pop up ads). They are advertising also by means of TV commercials, magazine ads and also in store advertising. They have done lot of promotions like Think different campaigns and the ipod people. Apple has advertised couple of rebate offers for products last year they are iwork software, mobile me and printer promotions. Back to school offers was like getting a Mac for college and get a free ipod touch was the latest. Apple can change the terms and conditions of the promotion at any time without prior notice. The promotional activities attracted more number of customers to buy apple products. The touch rebate has changed its cost to £229 when compared to the last year.
From the above analysis macro environment and marketing mix is substantial factors for a concern to do good business. We feel that Apple must focus on several key aspects to continue to grow and succeed. They must continue a stable commitment to licensing, push for economies of scope between media and computers, and become a learning organization. In the Demographic part you can see that Apple Inc has opened more stores last year. More revenue has been created in the sales of ipod and iphone. Forthcoming year the revenue will be increased by ipad. Energy consumption and the resources are utilized in a proper way. Apple is so unique from other products because of its innovative design. Technology is improving day by day to make things very easier to the customers. Latest ipad will be one of the reasons for high technology. From the socio-cultural factors we come to know that they are targeting all age groups. By getting feedback from each and every people worldwide, they are improvising the product. From these given factors they can know their positive and negative feedback.
The 4 P's of marketing mix describes about different marketing strategies. The marketing mix will focus to reach more marketers. In the coming years it will be able to provide a deeper analysis of marketing problems and also give direct solutions to it. It will be an analytical tool for various marketing solutions. The whole of marketing mix is important in developing effective positioning. The services of apple Inc have satisfied lot of customers. Product is purchased directly through internet mostly. Apple is planning to open many retail stores worldwide and the count is still going on.
* Philip Kotler , Marketing Management. Prentice - Hall International Editions. 135-153.
* Philip Kotler (2004), Principal of Marketing, Eleventh edition. New Jersey: Pearson
* Tull, S.D. and Hawkins, D.I. (1992). Marketing Research: Measurements and Methods
1. Marketing Management- Philiph Kotler
2. Marketing Management-Text and cases- Rajan nair
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