Strategic Marketing - Apple

Thèmes abordés

Apple pestel environment market strategic marketing

Résumé du document

With the help of PESTLE model, it is possible to understand Apple's strategic opportunities. The political, economic, socio-cultural, technological, legal and environment factors are the components of the PESTLE model that allow us to evaluate key elements that have a great influence on the company. This model is useful to anticipate future decisions and orientation of the company.

Political factors
Apple sells its product all over the world with 52% of global sales made outside the US. Wars, terrorism, geo-political tensions, public healthcare issues can damage Apple's business. These events are totally out of control for Apple. Likewise, Apple subcontracts and outsources transportation, logistics, components and product assembling in countries where production costs are very low. Most of these subcontractors are located outside the US, mainly in Asia. For example, the final assembling of products is carried out in Ireland, Korea, Czech Republic and China. Production, logistics and transportation in these countries can be delayed or even stopped by political issues and conflicts. If there is delay in the deliveries, Apple can't ship the product on time and the customers will not be satisfied. This will result in Apple losing its credibility and brand image, which are the two essential values for Apple.

Economic factors
During the financial crisis the economic perspectives were not very encouraging. Many economic factors impede the companies' profit margins like the high price ratings of the oil barrel, depreciation of currencies (USD), fall of purchasing power and unemployment. People consume what is really necessary for them and they abandon consumer electronics, computers, etc postponing the purchase of new equipment. This has resulted in slow elimination of the crisis and customers are beginning to buy products like new cell phones, laptops, mp3 players and computers. So, Apple has to be there, and be prepared with new products to attract the consumers.
Socio-cultural factors
Apple strongly relies on its products' federative power. Every iPod and especially Macintosh owner is strongly attached to the Apple brand. There is an Apple Culture that has existed since the creation of the company. The commercial technique of the company has always been to stay as close as possible to its potential clients. The goal is to make customers feel like they are part of this community. To achieve this goal, Steve Jobs frequently organized some meetings where he presented his projects to the Apple community. In this community, we can find developers, clients, but especially the press. The name of this kind of meetings is MacWorld, and they are convened in different strategic cities of the world such as New York, San Francisco or Tokyo. These meetings are always introduced with a video projection (realized with the software Apple Keynote, competitors of Microsoft Excel), presenting the end financial results, and generally the new products.

Extraits

[...] Some countries like those of EU, Canada, are taking legal measures against Apple. The iPhone case in France is a good example. Apple only wanted to sell iPhone with a unique provider. In France, Orange won the contract and was the only provider able to sell the iPhone. But the other telco companies (SFR and Bouygues Telecom) sued Orange and Apple because of illegal exclusivity, and they won. Apple had to provide iPhones for every provider in France, and this lead to huge additional costs for Apple. [...]

[...] Through this written document, we've been able to understand the secrets of Apple's success. Today, Apple succeeded in becoming a master of innovation and a technology mover. The Cupertino firm has now a strong brand equity, and despite of the economic crisis, the group continues to make profit. Apple's next challenge would certainly be one of the most difficult the brand will have to handle: how could Apple manage the transition between the status of challenger to the status of leader? [...]

[...] By the way, Apple stays very mysterious for people when it comes to strategy and marketing. That's why we are going to study some of the very important points that are part of Apple success story. These points are illustrated with concrete examples taken in Apple's product range Do not sell products: Indeed, Apple doesn't sell products to the consumer; it sells a unique experience with a product. No one cares about the technical specificities of a product and Apple knows that, and when Apple communicates on its products, it focuses on what you are going to be able to do with the product, and what is the product going to give you more that another product. [...]

[...] Apple wants to sell an experience to the customer, not a product. When Apple creates advertising for the iPod, they are not selling a mp3 device, but a new way of enjoying and experiencing music. IV. Integrated marketing program a. Advertising Advertising is very important at Apple. We all remember the Macintosh commercial aired during the Superbowl back in 1984, which is one of the most famous TV commercials ever. Apple, in its commercials, focuses on the product benefits and the experience that it will bring to the customer. [...]

[...] Do not forget that the creator of portable music is Sony, with its famous “Walkman” but now iPod is the master. The strategy adopted by Apple with the iPod is quite simple. First, Apple detects a quite new market (mp3 players) and analyzes it. There are many competitors and no one is outstanding with a real innovative product. So Apple gathers information's about what consumer want, what are the defects of the various products and then Apple closes all communication and start thinking of a revolutionary product. They stay very secret until the final product is achieved. [...]