No one can deny that Apple is one of the most successful tech companies and recognizable brands in the world. The company was instrumental in promoting digital music during the early 2000s through its iTunes and iPod products and was one of the pioneers in popularizing smartphones beginning in 2007 with the introduction of the iPhone.
The company is behind some of the most iconic products of the modern digital information age and it has remained at the forefront of developments in consumer electronics technology. Nonetheless, understanding the marketing mix of Apple is fundamental to understanding its competitive advantage and its profile as successful tech brand.
Exploring the Marketing Mix of Apple: A Concise Overview and Definitive Analysis
An integral part of the business strategy of Apple is a multi-faceted product strategy and differentiation strategy that takes into consideration the need to cater to the different needs of the greater consumer electronics market while introducing revolutionary and disruptive innovations that will create novel market demand. To understand this better, take note of its diverse and expansive product portfolio grouped into different product categories:
• Mobile Devices: Both the iPhone and the iPad, as well as the Apple Watch, AirPods, and future wearable products fall under this product category. The now-obsolete iPod can also be considered part of this product category.
• Personal Computers: This product category represents the entire Macintosh line of personal computers that include the Mac desktop computers such as the Mac Mini and the iMac and the MacBook laptop computers.
• Software and Services: Apple develops software such as the macOS and the iOS, a suite of productivity apps, and even games, while also offering numerous online-enabled services such as music streaming via the Apple Music and on-demand video streaming via the Apple TV, and its publishing platforms such as the iTunes and the App Store.
• Other Smart Devices: The company has been exploring and experimenting with new products under the smart device and entertainment categories. One of which is the Apple TV line of digital media players and microconsoles
• Accessories and Peripherals: Of course, Apple also develops products that complement its major products. These include power adapters and charging bricks, connectivity cables and dongles, keyboards and input devices, and decorative and protective casings for consumer electronic devices, among others.
Note that the product categories and the range of products mentioned above all point to the fact that Apple is a technology company that capitalizes on the existing and ever-evolving digital information age and modern digital electronics. It has been developing consumer goods and services that are either relevant to the existing trends in the market or that can create future demand by setting fresh market trends.
The particular product strategy of Apple and its specific product development philosophy can be considered a combination of proactive and retroactive approaches. The iPod and the iPhone are a testament to this fact. Note that the iPod was not the first portable digital music player and the iPhone was not the first smartphone. However, both have been considered iconic and revolutionary because they introduced next-generation features and functionalities.
It is also important to note that part of the specific product strategy of Apple is a combination of vertical integration and horizontal integration. For example, it is also a software developer and a chip designer. However, while the macOS and the Apple M1 or the A Bionic chips are not standalone products that can be purchased separately, they are integral components of the particular main products of Apple.
With regard to horizontal integration, the company outsources manufacturing capabilities from other firms as part of its supply chain strategy. It fundamentally focuses on product development and marketing while the implementation of its ideas is outsourced to more capable entities. This strategy allows it to focus on its strengths while also promoting efficiency both in product development and product costs.
Another interesting aspect of the marketing mix of Apple is the particular pricing consideration it has used on its products. The fact remains that its products are expensive. To be specific, these products are more expensive than most of their counterparts.
Both the iPhone and iPad are twice to thrice more expensive than Android smartphones or tablet computers. The same is true for its Mac computers, especially when they are compared with desktop and laptop computers based on the Windows operating system.
The company fundamentally follows a premium pricing strategy. Apple has two reasons for this pricing decision. The first is to promote and maintain a brand reputation that exudes superiority and quality over its rivals while providing a sense of extravagance that draws consumers into a positive emotional experience.
Furthermore, the second reason is to maximize its profitability. The difference between the costs of its products and their respective prices is considerably wide. For example, the iPhone 13 Pro costs around USD 600.00 to make but it retails between USD 999.00 and USD 1449.00. The company aims to earn a profit from each good or service it sells.
Apple rationalizes its high prices through products with superior built quality or features and functionalities that are both experiential and innovative. It also provides general after-sales services such as guarantees and tech support at no extra cost.
The company also utilizes other pricing strategies for its other products. For example, for its Apple Music and Apple TV services, and its iCloud service, it uses a combination of a freemium pricing strategy and a decoy pricing strategy.
The distribution strategy of Apple is considerably straightforward because it consists of direct and indirect distribution channels tied to its supply chain strategy. To understand this further, take note of the following:
• Physical Direct Channel: The company has physical stores located across the world. These stores showcase all of its relevant products ranging from its Mac and MacBook computers to its iPhone and iPad devices and accessories.
• Online Direct Channel: It also maintains an e-commerce platform integrated within its official website wherein customers from most parts of the world can select the products they intend to buy, order from the platform itself, and pay using their credit cards.
• Indirect Channels: Apple has also partnered with third-party retailers in strategic parts of the world for its indirect distribution that includes authorized distributors, chains of consumer electronics retailers, and even network carriers.
Both official Apple Stores and authorized distributors follow certain branding guidelines characterized by a clean and minimalist look and feel. These stores essentially serve as showrooms that exhibit all of its flagship products. Customers are free to try these products.
In addition, these official and authorized stores have dedicated personnel trained to provide product knowledge and provide after-sales support that ranges from product tutorials and setup. Some stores also offer product troubleshooting and in-house repairs.
The most interesting element of the marketing mix of Apple is its promotional strategy which has become its source of competitive advantage. Remember that it is one of the most recognizable companies and most revered brands in the world. Apple is both a household name and a cultural artifact.
In the past, the company was behind several iconic ads to include the iPod product launch and the Mac versus PC television advertisements. However, it is interesting to note that it rarely does advertisements and paid product placements nowadays.
The following are the specific tactics and activities under the promotional strategy of Apple:
• Advertising: The company still does advertising. It periodically launches ads on special occasions as part of moment marketing. Furthermore, it also pushes its less popular products and services through TV commercials and print ads. The company also places a regular ad spot on Google Search and related Good Ads platforms.
• Public Relations: One of the strengths of Apple when it comes to promotion is public relations. It has reached a point in which it has become sought-after by the media, including independent journalists, tech reviewers, and influencers. For example, its Apple Event and Developers Conference naturally attract the attention of notable traditional and social media personnel, thus giving the company and its product launches or important announcements free exposure and considerable mileage.
• Sales Promotion: Apple also attracts its customers through different sales promotional tactics. For example, it provides discounts for students and business owners. The company also has a trade-in program in which customers can exchange their old devices to receive cash credits that they can use to purchase another device. It also provides freebies such as the free apps found in macOS and iOS operating systems.
• Personal Selling: Remember that it uses direct and indirect distribution channels through its company-owned stores and third-party retailers. These stores have a high personnel-to-customer ratio to cater to all of the needs of walk-in and potential customers. These sales personnel are also well-trained to demonstrate extensive product knowledge.
• Events Marketing: The Apple Event and its Worldwide Developers Conference both serve as public relations tactics and particular events marketing initiatives. These events serve as a form of an exhibition and a trade show in which the company launches new products or makes significant announcements. Note that it holds an average of three to four events in a given year.