Running head: FINAL PROJECT 1

Final Project

Kemjika Echebelem

California Southern University

MKT 86502

27 July 2018

Mike Morris
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Apple’s Marketing Strategies for iPad Then

The successful multinational technology company known as Apple Inc. released its first

iPad tablet into the U.S. market on April 3, 2010 (Fingas, 2018). Coming out as a successor to

Apple’s original tablet-like predecessor, the MessagePad, the iPad has become a multimillion

dollar success for the company (Hattersley, 2014). In order to achieve this level of success with

the iPad, Apple relied on marketing strategies based on simplicity and innovation.

As Forbes contributor Jayson DeMers (2014) explained, Apple has succeeded in gaining

numerous sales because the company aims to simplify customer decision making. Indeed,

customers find it easier to choose the right product when they are not bombarded with complex

messages (Kotler & Keller, 2016). Moreover, Apple’s simplicity is evident in the promotions of

the iPad. The company has managed to get its message across with simple ads that are clear and

concise. For example, a billboard advertisement may show an individual lifting up an iPad 2 with

one finger to emphasize the iPad’s lightweight design (DeMers, 2014).

Apple has also incorporated simplicity into its product strategy. In fact, iPads have gained

popularity because of their simplicity and intuitiveness (DeMers, 2014). Along with the sleek

design and high-quality pixel display, these characteristics appeal to a range of target groups,

from the tech-savvy consumers to the kids & seniors looking for something simple (DeMers,

2014). While the aforementioned characteristics of Apple’s marketing strategy has been positive

in nature, there were some weaknesses in Apple’s positioning strategy. In the early stages, the

company failed to invest in the lower end of the market, missing out on the potential benefits

(Rawlinson, 2017). However, Apple eventually became cognizant of this benefit and therefore

began to offer inexpensive iPads to those in the lower income bracket, setting the stage for its

low-cost pricing strategies (Greene, 2018).

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Apple’s Marketing Strategies for iPad Now

Many of Apple’s past marketing strategies are still used today, such as its strategies of

low-cost pricing and product innovation. In fact, Apple has revolutionized its iPad with new

models, such as the iPad Air, thus expanding the company’s product line (Kotler & Keller,

2016). The advent of iPad Mini has incited the development of the Google Nexus 7 and Amazon

Kindle Fire (Fingas, 2018). As a result of this competitive innovation, Apple has managed to

strategically position itself as a market leader in the consumer electronics industry.

Apple’s innovation is also seen in the makeup of it iPad, which is the first Apple product

to use an Apple-designed processor (Fingas, 2018). Other features like the 1024-by-768 pixel

display and multiple options for storage characterize the iPad, which can be sold thru multiple

channels, such as in-store and online (Apple Inc, 2018). Additionally, Apple has included

Numbers, its spreadsheet app, to compete against Microsoft’s Excel and iBookstore, to compete

against Amazon’s online books (Rawlinson, 2017). To target those who favor education, such as

moms and teachers, Apple has promoted its iPads as educational products.

Apple’s recent business practices have also received their fair share of criticism from

customers. The company has been criticized for its lack of commitment to sustainability (Scheer

& Moss, 2014). Many of its products require the use of excessive amounts of raw materials to

manufacture. In fact, the use of conflict minerals in phones and tablets is so pervasive that it has

been regulated (Schermerhorn & Bachrach, 2015) and thus caused Apple to adopt a sustainable

initiative to reduce its material used in manufacturing iPads (Moss & Scheer, 2014).

Additionally, Apple has received criticism over its implicit condonement of sweatshops in its

foreign subsidiaries, prompting the company to implement new labor standards (Beauchamp,

Bowie, & Arnold, 2013).

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Product Offering & Strategy

Considering the pros and cons of Apple’s marketing strategy for the iPad, there is room

for improvement. A similar but slightly more effective marketing strategy can be employed to

market Apple iPads. Starting with the product strategy, one of the six P’s of the marketing mix,

several inadequacies can be addressed to improve the iPad (Kotler & Keller, 2016). For one,

additional features can be added to the product.

For example, the regular iPad lacks a flash feature in the camera, a built-in stand, and

an audio component for the iBooks app. The iPad should essentially be presented like an

expanded iPhone that can be used like a laptop, similar in style to the Microsoft Surface Pro

(Greene, 2018). In line with this description, consumers may expect and desire the iPad to have

these basic features that come along with Apple’s highly grossing iPhone, namely, camera

flash, a pop socket, and iBooks audio. Moreover, a certain feature of the iPad to improve deals

with an accessory item, the Apple Pencil. Concerned customers argue that the Apple Pencil

represents a safety hazard for kids when it protrudes out from the tablet. To correct this, the

iPad manufacturers should create an appropriately sized compartment where the Pencil can be

safely placed to avoid any injury.

Another area that should be innovated is the selection of the executive board. Process

innovation ought to be implemented to ensure human resource management (HRM) properly

chooses the best applicants to fill in the roles (Schermerhorn & Bachrach, 2015). HRM needs to

use an effective screening method to identify individuals who are exhibit both creativity good

people skills and fit in to Apple’s organization culture of innovation and creativity. Carrying out

these tasks, coupled with trainings for top management can lead to creation of modern,

consumer-friendly products and even help reduce CEO turnover (Rawlinson, 2017).

Positioning of Brand
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After identifying the product, its features, accessories, and functions, the marketing team

must work with Apple to establish the company’s positioning in the market. As Kotler and Keller

(2016) elaborate on in their book, Marketing Management, brand positioning occurs after a

company has segmented the market and identified its targets. However, in the early stages of

Apple’s marketing campaign, the firm failed to adequately market to the lower end of the market

(Rawlinson, 2017).

Therefore, a new and reformed strategy calls for a plan to market to high-income bracket

upper-class families as well as to those in the lower end of the socioeconomic spectrum. In

reaching out to the lower class populations, the firm will be able to reap the benefits rather than

incur the opportunity cost of a loss in potential in sales and profit margins (Thomas & Maurice,

2016). Furthermore, marketing to multiple income brackets positions the company as a seller of

both high-quality and affordability when it comes to consumer electronics.

Apple has to devise ways to strategically compete with other consumer electronic

competitors’ products, such as Microsoft’s Surface Go tablet and Amazon’s Kindle Fire in order

to stay in the lead (Greene, 2018). This is crucial, especially considering the fact that Apple’s

operating system, iOS – which is used in all Apple products – trails behind Microsoft Windows

in terms of market share (Greene, 2018). This impact is multiplied as the company sells it

licenses to other manufacturers and companies, as it has done in the past. This act lends itself to

product imitation not just from American companies, but also from smaller foreign firms who

specialize in consumer electronics. Therefore, to avoid the Apple brand nearly becoming

cannibalized, as is what almost happened to Steve Jobs’ company, this new proposed strategy

advocates for trusted partnerships that can help Apple stay ahead of competition (Coville, 2014).

Pricing Strategy
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Apple’s pricing strategy for the iPad has been pretty much consistent throughout

the lifetime of the product: value-pricing. While Apple iPads are not necessarily cheap for

the average customer, the products have high value. The products’ price is simply a reflection

of the bundle of features and services that can come along with the product offering, such as

maintenance and extra storage. For example, when iPad came out in the spring of 2010, Apple

varied the price of the product based on the amount of storage available and whether or not

products have Wi-Fi and 3G features (Apple Inc, 2018).

This value-pricing strategy has been effective and therefore should continue to be

implemented. Customers are more likely to pay for an iPad that costs $100 more if they know

that the higher-priced item has 64 gigabytes instead of 32 gigabytes (Apple Inc, 2018). This

strategy plays on consumer psychology. In this twenty-first century, consumers are much more

cost-conscious and skeptical of products, especially those with high priced tags (Schermerhorn

& Bachrach, 2015). The skepticism can arise from the uncertainty associated with whether or

not high-priced products are legitimately high-quality or if the products are inauthentic.

One intervention that can be implemented is the provision of price-checking tools, similar

to that of insurance companies like Progressive (Kotler & Keller, 2016). These tools should

allow the customer to compare Apple’s iPad prices with those of competitor tablets. While

undertaking this task may risk the company customers who pursue cheaper options, it will

establish a greater sense of trust of the company in the mind of the customer.

Furthermore, when outsourcing production of the iPad for cost control, it is important to

not avoid complete neglect of quality. Practicing cost control while also maintaining quality

control can help minimize product returns (Schermerhorn & Bachrach, 2015).

Promotions & Advertising

Considering that the product offering has been defined, the brand has been properly

positioned in the appropriate market, and prices have been set to reflect value of products, the
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next task is to communicate this value to the target market(s) through promotion (Kotler &

Keller, 2016). In this day and age, when almost every individual you meet on the street owns a

smartphone, it is nearly a marketing requirement for companies, such as Apple to promote their

products online and thru the mobile phone. This fact is precisely the reason why so many firms

and businesses are engaging in e-commerce and m-commerce, the latter of which is a recent

concept defined as electronic commerce through mobile phones (Kotler & Keller, 2016).

To best promote the Apple iPad, several channels of communication must be used.

Visible promotion methods like televisions ads and billboards are effective because of the high

viewer content. However, due to the high volume of consumers who own PCs and laptops, email

and search ads are a little more effective, even if not very cheap (Kotler & Keller, 2016). The

benefit of online advertising and promotion is the ability to reach consumers more personally

through customized ads. Regardless of the channel of communication, iPad promotions and

advertising must be simple to keep in line with Apple’s principle of simplicity (DeMers, 2014).

In addition to varying the channels of communication, Apple must also vary the place of

its communication. It is hardly profitable for any U.S. corporation to not invest in the global

market overseas, considering the rise of globalization in the market. In the case of a company

like Apple, whose revenue relies heavily on the products, the company should engage in reverse

innovation in emerging foreign markets like India and China to measure the consumer

perceptions of new products and prototypes, before selling to U.S. customers (Kotler & Keller,

2016). Doing so permits the company to identify any undesirable characteristics or flaws.

Place of Distribution

In order to best deliver the value that has been communicated to consumers concerning

the Apple iPad, or any Apple product for that matter, a multichannel approach must be taken.
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That is why the iPad is not only sold in the brick-and-mortar store. It is also sold online on the

company website and in online product catalogs. Customers should be able to choose whether

they want to do an online order with store pickup or have their ordered iPad delivered to them.

This multichannel strategy must be practiced by any medium-sized or large company that wants

to build a large customer base and gain a high market share (Kotler & Keller, 2016).

The channels of distribution mentioned above are only the half of what distribution

medium are available today. In order to reach consumers in the foreign markets, Apple can have

its iPads transported to foreign countries overseas by plane or ship. This method of transportation

is especially helpful when Apple needs to send a bulk load of iPads to clients. Moreover,

sometimes the company may want to deliver a bulk load of its product to clients in third world

countries, especially those countries whose economies rely mostly on importation of goods.

These countries depend on large multinational firms from developed countries to come and

invest in the foreign nation by selling the products. Many times, the entry of consumer

electronics items into these foreign markets helps to boost the economy, when the firm decides to

provide jobs by establishing a subsidiary in the host country (Schermerhorn & Bachrach, 2015).

As part of this new proposed marketing strategy, Apple could also employ another

channel of distribution: drones. These automatic aerial vehicles are already used by companies

such as Amazon. However, the competitive advantage Apple has is that its ground stores are

longer established while Amazon just recently started Amazon Go (www.amazon.com), its first

ever shopping store. Further research must be done to decide if drones would be profitable.

Personal Relationships

The modified marketing strategy proposed in this paper for Apple’s iPad is not only

beneficial in terms of product sales, brand promotion, market share and profit margins. This
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marketing strategy for the iPad product line can also build more trust and loyalty in the personal

relationships between customer and company. The bridge between the firm and its customers are

the salespeople, those individuals selling individually to the client (Kotler & Keller, 2016). These

are the people that help connect the customer to the company, and thus improving the

relationship between salespeople and customers is crucial.

Something that can be done to strengthen the buyer-seller relationship is a method called

sales training. Through role-playing and empathy training, companies can train their salespeople

to better connect to customers, anticipate their needs, and give helpful solutions (Cespedes &

Lee, 2017). Sales representatives trained to be more customer-focused and less sales-focused do

not only help generate sales, but they also help increase customer-perceived value of the

company, which when maximized leads to products that exceed customer expectations

(Schermerhorn & Bachrach, 2015), such as the iPad, arguably one of the most successful

consumer products in the market.

For Apple, it is one thing to build a positive relationship with its individual customers,

but it is another thing to build a positive relationship with the public at large and with foreign

partners. Maintaining a positive relationship with the Apple society and environment

surrounding the company involves exercising a strategy of corporate social responsibility (CSR)

(Schermerhorn & Bachrach, 2015). Exercising CSR means that Apple should keep close watch

over its foreign subsidiaries, implementing a zero-tolerance policy for sweatshops and ensuring

that their business practices incorporate social innovation to benefit society.

References

Apple Inc. (2018). Retrieved July 25, 2018 from https://www.apple.com/ipad/

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Beauchamp, T.L., Bowie, N.E., & Arnold, D.G. (2013). Ethical theory and business. (9th

Edition). Prentice Hall.

Cespedes, F. V., & Lee, Y. (2017, June). Your sales training is probably lackluster. Here’s how

to fix it. Harvard Business Review. Retrieved from https://hbr.org/2017/06/your-sales-

training-is-probably-lackluster-heres-how-to-fix-it

Coville, Andrea. (2014). Relevance: the power to change minds and behavior and stay ahead of

the competition. Bibliomotion.

DeMers, J. (2014, July). Here's the simple secret to Apple's marketing success. Forbes. Retrieved

from https://www.forbes.com/sites/jaysondemers/2014/07/08/heres-the-simple-secret-to-

apples-marketing-success/#4cfa594711e3

Fingas, R. (2018, April). A brief history of the iPad, Apple's once and future tablet. Apple

Insider. Retrieved from https://appleinsider.com/articles/18/04/03/a-brief-history-of-the-

ipad-apples-once-and-future-tablet

Greene, J. (2018, July 9). Microsoft adds a lower-cost tablet in challenge to Apple’s iPad. The

Wall Street Journal. Retrieved from https://www.wsj.com/articles/microsoft-to-sell-low-

cost-surface-to-rival-apples-ipad-1531187597?mod=searchresults&page=1&pos=6

Hattersley, L. (2014, September). Apple timeline in pictures and video. Macworld. Retrieved

from https://www.macworld.co.uk/feature/mac/30-years-mac-mac-timeline-pictures-

24596/

Kotler, P. & Keller, K. L. (2016). Marketing Management. (15th Edition). Pearson.

Moss, D. & Scheer, R. (2014, April). Is Apple really serious about sustainability? Business

Ethics: The Magazine of Corporate Responsibility. Retrieved from http://business-

ethics.com/2014/04/27/11639-is-apple-really-serious-about-sustainabilit/
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Rawlinson, N. (2017, April). History of Apple: The story of Steve Jobs and the company he

founded. Macworld. Retrieved from https://www.macworld.co.uk/feature/apple/history-

of-apple-steve-jobs-mac-3606104/

Schermerhorn, J.R. & Bachrach, D.G. (2015). Management. (13th Edition). Wiley, John & Sons,

Inc.

Thomas, C. R., & Maurice, S. C. (2016). Managerial economics: Foundations of business

analysis and strategy. (12th Edition.). McGraw-Hill.