Apple Iphone Marketing Plan

Arab Academy for Science, Technology
and Maritime Transportation

MBA Group H
Apple iPhone Marketing Plan

Group Assignment
Ahmadullah El-Hadidy
Basem Gaber
Hany Abdulwahab
Kareem Raslan
Moustafa Hanafy
Tamer Yousif
• Executive Summery
• Situational Analysis
• SWOT Analysis
• Marketing Objectives
• Marketing Strategy
• Implementation
• Budget
• Control
Executive Summery
• SWOT Analysis
The Past – Steve Jobs, Steve Wozniak and Ronald Wayne established Apple • Marketing Strategy
on April 1, 1976 in order to sell the Apple 1 Computer Kit that was hand • Marketing Research
built by Steve Wozniak. The Apple 1 was sold as a motherboard (with CPU, • Implementation
RAM and basic textual video chips) – less than what is considered a personal • Budget
computer today. Apple was responsible for creating the desktop publishing • Control
market due to their innovative programmes, PageMaker and LaserWriter.
Between 1983 and 1996 Apple experimented with a number of failed
consumer target products including digital cameras, portable CD players,
speakers, video consoles and TV appliances. Market share and stock prices
decreased. In 2001, Apple introduced the iPod portable digital audio player.
The product was phenomenally successful – over 100 million units were sold
within 6 years.
Executive Summery
• SWOT Analysis
The Present – January 2007, Steve Jobs, the CEO and Co-Founder of Apple, • Marketing Strategy
announces that Apple Computer Incorporated would now be known as Apple • Marketing Research
Inc. He also reveals the long anticipated iPhone, a combination of an • Implementation
Internet-enabled smartphone and the iPod. In June 2008, he announces that • Budget
the iPhone 3G would be released in July 2008, this newer version added • Control
support for 3G Networking and assisted GPS navigation, among other things.
The Future – Apple plans on focusing on satisfying personal consumer

demands rather than merely fulfilling a demographic requirement as well as,
improving performance and stability rather than introducing new features
when releasing new versions of any product.
Think Different
Executive Summery
• SWOT Analysis
The iPhone targets consumers who need to store information and • Marketing Strategy
communicate or people who want entertainment on the go. Apples target • Marketing Research
segments consist of professionals, students, corporate users, entrepreneurs, • Implementation
and health care workers. Currently, the market for high-end phones like the • Budget
Apple iPhone is small. Few people want Internet, video, and PDA features in • Control
one device because of the high price. The smart phone market is still relatively
small compared with general phone market. The market will rapidly increase in
coming years due to lower prices and greater power.
Situational Analysis
• SWOT Analysis
Political Situation • Marketing Research
•Taxation is something that governments put and Apple should be • Implementation
study this as country by country case to anticipate profitability, and • Budget
pricing strategy. • Control
•Importing laws in the world with GATT are in favor of trading.
•Countries are very variable in stability of, so we should study each
country case by case.
Economical Situation
•Economical growth world wide is in a big recession which need
careful manipulation
•Potentiality of the market is decreasing but it is higher than any
others in the Telecom sector.
• SWOT Analysis
Socio-Cultural Situation • Marketing Research
•Population growth leading to expansion of the sector needs for cell • Implementation
phones. • Budget
•People depend more an more on mobile communication • Control
everywhere.
•There is educational growth in the world.
•Culture’s perception of the technological devices is positive
worldwide.
•Literacy & illiteracy level is not affecting using cell phones but
affecting high technological cell phones, this fact needs to be
considered.
• Acceptance of imported products in some countries are less if
there is local provider
•There are different social views that may affect product should be
considered (e.g.: Boycotting American products in the Islamic
world)
• SWOT Analysis
Technological Situation • Marketing Research
•Level of technology in the world is increasing. • Implementation
•Internet level of awareness & usage for individuals & industrial • Budget
aspect are increasing worldwide • Control
•Fixed phone lines capacity and development attempts.
•New technologies in the cell phones are increasing.
•Future plans for technological linkage between cities, universities,
colleges, hospitals and other institutes are increasing and can be
connected to cell phones
•Level of usage of the E- Technology (online bidding, billing,
complaints, blogging etc) are high and trendy.
• SWOT Analysis
• Marketing Research
Competition Situation • Implementation
•There are 19260 cell phone producer in the world, but there are • Budget
more than 15 big companies competing at the world level Market. • Control
• SWOT Analysis
Environmental Situation • Implementation
•The global concern of the Global Warming issue & other pollution • Budget
effects concerning the packaging material and radiation of the cell • Control
phones
•The demand of the international environmental approvals is a must
(if there is any)
Sales Situation
Cell phones industries are one of the most
profitable industries everywhere and the
Market is increasing
S/O Analysis
• SWOT Analysis
Strengths • Marketing Research
Innovative – The iPhone has an innovative touch screen. It also has • Implementation
many functions of other mobile products all in one device • Budget
• Control
Compatibility –The phone will work with iTunes and with other
Mac/Apple products and OS software tools which means limitless
potential for upgradeability.
Ease-of-Use – The all-new touch screen interface recognizes multi

. finger gestures, just as the human hand normally behaves
S/O Analysis
• SWOT Analysis
Brand awareness – Apple is well known for cool essential • Implementation
gadgets like the iPods along great technological innovations like the • Budget
original Macintosh. • Control
S/O Analysis
• SWOT Analysis
Price – iPhone would be sold at a reasonable price for its • Implementation
value. • Budget
• Control
Quality – Scratch resistant screen – durable and light

metallic finish - software suite resistance to computer
viruses.
S/O Analysis
• SWOT Analysis
Opportunities • Marketing Research
Increasing demand and expansion to a new target segment – • Implementation
As technology advances and smart phones get cheaper Apple will • Budget
attract consumers and get iPod users to upgrade to iPhones. • Control
Upgradeable – iPhone software allows new exciting features to be

brought in which take advantage of the touch screen ability. Future
versions will also be hardware upgradeable.
S/O Analysis
• SWOT Analysis
Opportunities • Marketing Research
Partnerships – Apple can collaborate with many powerful global • Implementation
mobile phone companies to flood the market with iPhones, which • Budget
reduces costs in marketing and increases revenue through long-term • Control
agreement deals.
W/T Analysis
• SWOT Analysis
Weaknesses • Marketing Research
Image – The Apple brand is not targeted towards business people and • Implementation
does not have a reputation as being compatible with the corporate • Budget
world. • Control
Price – Apple does not yet offer lower priced models for more cost
conscious consumers.
User Interface – Touch screen interfaces suffer from the problem of

“gorilla arm”*
* Gorilla arm is a side-effect that humans face when using touch screens for long times as humans are not built
to hold their arms at waist or head-height, making small and precise motions. After a short period of time, cramp
may begin to set in, and arm movement becomes painful and clumsy. This is now considered a classic
cautionary tale to human-factors designers.
W/T Analysis
• SWOT Analysis
Threats • Marketing Research
Increased competition – Smart phones are easier to make now more • Implementation
than ever. More companies may enter the market, and competitors or • Budget
even Apple contractors can maneuver around patents to create similar • Control
devices.
Downward pricing pressure – The iPhone is marketed as a high-

end phone, but phone prices are almost certainly going to fall when
other companies undercut the price of iPhones.
Difficulty expanding into Asian market – There is less hype and

interest in Asia since smart phones are better known and already widely
used.
W/T Analysis
• SWOT Analysis
Threats • Marketing Research
Competition (Palm) - Palm has the longest history in PDA market • Implementation
and has experience-developing software for mobile devices. It is also a • Budget
well-known brand for businesspeople. Existing software is well • Control
established and compatible with many products for this market. The
market is familiar with Palm products; significant switching costs are
involved in going to an iPhone. Palm can add many similar capabilities
to their products that match the iPhone and expand to a wider market
through lower cost and higher-power products.
Marketing Objectives
• SWOT Analysis
• Set an aggressive buy achievable objective for the first and • Marketing Research
• Implementation
second years of market :
• Budget
1. First-year Objectives - We are aiming for a 2 percent • Control
share of the U.S and U.K. PDA/Phone market through
unit sales volume of 445,000.
2. Second-year Objectives - are to achieve a 10 percent
share based on sales.
• Extend on the Apple brand name and link to the established

meaningful positioning.
• Extend on Apples image of innovation, quality, and value.
• Measure the awareness and response in order to make

adjustments to the marketing campaigns as necessary.
• SWOT Analysis
Target Market • Marketing Strategy
• Implementation
• Differentiate the iPhone from other PDA’s on the market. • Budget
• Control
• Primary customer targets is the middle-upper income professional
to coordinate their busy schedules and communicate with
colleagues, friends and family.
• Secondary consumer targets are high school, college and graduate

students who need one portable multifunction device.
• Primary business target is to partner with :

• large cell phone service providers, AT&T, Verizon,
Sprint and Cellular One
• large enterprise software firms where information is
critical to the end user.
Marketing Objectives •
•
SWOT Analysis
Target Market (cont.) •
•
Marketing Strategy
• Secondary business target is mid-to mid-size corporations that • Implementation
want to help managers and employees stay in communication or • Budget
access critical data on the go. • Control
• Market segment will consist of companies with $10-$50 million in

annual sales.
Positioning
• Using product differentiation, positioning the iPhone as the versatile,
convenient, value-added device for personal and professional use.
• Focus on the convenience of having one device for communication,

but also music, pictures, and video, and full Internet access.
• The iPhone will be promoted as both professional and hip.

.
• Executive Summary
Marketing Mix Strategy

• SWOT Analysis
Product • Marketing Research
•Full year warranty along with an optional three-year Apple Care • Implementation
warranty • Budget
• Control
•Same taste as all other Apple products
•Special edition version to be launched (including the iPhone Beatles

edition celebrating their 40th anniversary)
•Launching a cheaper version in 2008 with less

advanced features along with a more
advanced version for professional use
•Adding the following features to the iphone

(large disk storage capacity, lower weight,
thinner device, long battery life, 4G wireless,
GPS and improved camera)

• SWOT Analysis
Price • Marketing Research
•Set the base model at a cheap price of $349 • Implementation
• Budget
•A more advanced model for $399 • Control
•Special limited edition Beatles iPhone for special prices
•Generally lower our prices to ensure we establish market dominance

in as short of time as possible

• SWOT Analysis
Place • Marketing Research
•Massive rollout worldwide at all reputable major retailers • Implementation
• Budget
•Massive rollout Online, Showrooms and in all cell phone providers • Control
•All Apple Stores the Apple website will dedicate themselves to the
iPhone
•Eye catching displays will be found at all physical

stores featuring the iPhone to make the product
stand out from the pack
•Apple Stores will have the iPhone on display a full

month before its worldwide release

• SWOT Analysis
Promotion • Marketing Research
•Integrate Apple message of revolutionary communications and • Implementation
audio/visual experience together in all media advertisements • Budget
• Control
•Differentiate the iPhone against others is the touch screen
functionality
•Emphasize Apple brand prominently and associate the

iPhone with the iPod’s groundbreaking lineage
•Original but tasteful advertisements at the same time
•A massive TV campaign is planned before launching the iPhone

featuring a soon to be legendary ad to be the talk of the country
•Advertising will be appearing on a regular basis to

maintain general public awareness
Marketing Research •
•
•
SWOT Analysis
•Four age groups will be targeted: 15-20 years, 20-25 years, 25-45 • Marketing Strategy
years, and 45 years and up • Marketing Research
• Implementation
•High School and College aged people will demonstrate social uses • Budget
• Control
•The 25-45 years group will be used to determine business application
and social/personal use
•The 45 years and above will give us a plan to market to more senior
well-refined group
Marketing Research
• SWOT Analysis
•This research will be done through surveys (via email campaign • Marketing Strategy
through portals such as, iTunes and other on-line application • Marketing Research
• Implementation
developed for the iPhone) and interviews (in Apple stores) with the
• Budget
same age groups listed before
• Control
•To bring the iPhone to the front of the business world it is important
to research different ways to grow the 15-25 year old group into
business uses of the product
•Brand awareness will be an important tool in taking the Apple brand

from "social cool" to "business cool".
Marketing Research
• SWOT Analysis
•We will ask for feedback on iPhone features, and implement those • Marketing Strategy
changes most important to the end user in the next generation iPhone • Marketing Research
• Implementation
• Budget
•We will allow users themselves to design their own ideal iPhone on-
• Control
line and use any useful ideas to further refine future iPhone models
•We will continuously scour the Apple fan websites to understand

what the Mac faithful are saying, as they are our best customers.
Implementation
• SWOT Analysis
Compensation system • Marketing Research
•workers $5 incentive pay for every non reject phone they produce • Implementation
•$10 per phone six sigma quality program • Budget
•each worker $5000 each year for best practice training • Control
use control measures to closely monitor

quality and customer service satisfaction
consumers can contact the main headquarters

about any possible technical problems – by using
Apple Customer Service Bar and a customer service phone number
stored in the phone book
Implementation
• SWOT Analysis
In case of slow sales • Marketing Research
•Offer iPhone to customers who have purchased other Apple products • Implementation
$10 per phone six sigma quality program, which will lead to: • Budget
• Control
•demonstrate the product for consumers, it will promote synergy
and lure buyers.
•develop deep relationships with two very different segments:

those who have it and those who aspire
Budget
• SWOT Analysis
•Our break-even analysis assumes wholesale revenue of $500 per unit
variable cost of $250 per unit and est. fixed cost of $50 million. Based • Marketing Research
on these assumptions the break-even calculation is $50 million • Implementation
divided by $500 minus $250 equals 200,000 units sold. • Budget
• Control
•Break-even calculations indicate that Apple will become profitable
after the sales volume exceeds 200k. After the first year Apple will
make a profit of 1.25 billion minus 50 million in fixed costs.
•Recommended price is $350. The markup is 40 percent.
•It is predicted that sales volume will increase at least 60 percent from
this change; this will decrease the impact of fixed costs and improve
opportunities to increase our production scale, which will further
improve profits in the long run
Control
• SWOT Analysis
To plan our strategy we will meet monthly with the board of Apple, • Marketing Research
• Implementation
present our information, and make a proposal for continued marketing
• Budget
efforts. Before each meeting our team will meet in private, with each
• Control
person presenting their own proposal based on the information they
have learned. After the initial proposals, we will vote on the best one
or come to a compromise. The final proposal sent before Apple is the
result of that meeting.

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Arab Academy for Science, Technology

and Maritime Transportation

Apple iPhone Marketing Plan

The Future – Apple plans on focusing on satisfying personal consumer

Ease-of-Use – The all-new touch screen interface recognizes multi

Quality – Scratch resistant screen – durable and light

Upgradeable – iPhone software allows new exciting features to be

User Interface – Touch screen interfaces suffer from the problem of

Downward pricing pressure – The iPhone is marketed as a high-

Difficulty expanding into Asian market – There is less hype and

• Extend on the Apple brand name and link to the established

• Extend on Apples image of innovation, quality, and value.

• Measure the awareness and response in order to make

• Secondary consumer targets are high school, college and graduate

• Primary business target is to partner with :

• Market segment will consist of companies with $10-$50 million in

• Focus on the convenience of having one device for communication,

• The iPhone will be promoted as both professional and hip.

Marketing Mix Strategy

•Special edition version to be launched (including the iPhone Beatles

•Launching a cheaper version in 2008 with less

•Adding the following features to the iphone

Marketing Mix Strategy

•Special limited edition Beatles iPhone for special prices

•Generally lower our prices to ensure we establish market dominance

Marketing Mix Strategy

•Eye catching displays will be found at all physical

•Apple Stores will have the iPhone on display a full

Marketing Mix Strategy

•Emphasize Apple brand prominently and associate the

•Original but tasteful advertisements at the same time

•A massive TV campaign is planned before launching the iPhone

•Advertising will be appearing on a regular basis to

•Brand awareness will be an important tool in taking the Apple brand

•We will continuously scour the Apple fan websites to understand

use control measures to closely monitor

consumers can contact the main headquarters

•develop deep relationships with two very different segments:

•Recommended price is $350. The markup is 40 percent.

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