Strategic Planning of Marketing
Presented by:
Management Rene de Olivieira
Maria Fernanda Diaz
Steven Mastrodomenico
Source: Marcelo Sakai
http://www.howardmodels.com/ Fernando Vicenzo Berto
Table of Contents
• Chapter 1 – Introduction and Brief History
• Chapter 2 – Environmental Analysis
• Chapter 3 – Analysis of the Company and Competitors
• Chapter 4 – Establishing the Objectives
• Chapter 5 – Strategies for Achieving the Goals
• Chapter 6 – Decisions of Products, Services, Brands, and Packages
• Chapter 7 – Decisions in Communication
Table of Contents
• Chapter 8 – Decisions of Channel in Distribution
• Chapter 9 – Decisions in Sales Force
• Chapter 10 – Decisions of Prices
• Chapter 11 - Budget and Investment Analysis
• Chapter 12 - Management and Control of Strategic Planning of Marketing
Management
• Bibliography
Chapter 1
Introduction
Source:
http://www.appleipadapplications.org/apple-ipad-event/
1.1
Apple’s Headquarter
• Located in Silicon Valley, California
since 1993
– The city for leading hub for high-
tech innovation and development
– Accounts for 1/3 of all of
the venture capital investment in
the United States
• Has 6 buildings that total
850,000 square feet
• One of the largest companies in the
world
• The most valuable technology
company in the world, having
surpassed Microsoft
Source:
http://www.hellocompany.org/page/70
1.2
Company’s History
• April 1, 1976:
– Steve Jobs and Steve Wozniak created Apple Computer
• January 3, 1977:
– The release of the Apple I, and incorporated the company
• April 16 & 17, 1977:
– Apple II had its first West Coast Computer Faire
– Jobs introduced Apple II to a Japanese chemist named Toshio
Mizushima, who became the first authorized Apple dealer in Japan.
• December 12, 1980:
– Apple launched the Initial Public Offering of its stock to the investing
public
• October 1983:
– Macintosh 128k was announced to the press
• 1999:
– Apple introduced the Power Mac G4
Company’s History
• 2001:
– Apple introduced Mac OS X
• May 2001:
– Announced the opening of a line of Apple retail stores
• October 2001:
– Introduced its first iPod, portable digital audio player.
• 2004:
– Introduction of the iPod Video, then the iPod Classic, and
eventually the iPod touch and iPhone
• July 19, 2010:
– Introduction of iPad
• March 1, 2011:
– Introduction of iPad 2
Timeline of Apple Products
Source:
http://en.wikipedia.org/wiki/Timeline_of_Apple_Inc._products
1.3
Expansion of Market
Source:
http://www.apple.com/retail/storelist/
Expansion of Market
• Late 2003:
– Apple opened its first Apple Store abroad, in Tokyo's Ginza district
• August 2004:
– Followed by a store in Osaka, Japan
• November 2004:
– Apple's first European store opened in London and is currently the
largest store
• 2005:
– Opened stores in Nagoya, the Shibuya district of Tokyo, Fukuoka,
and Sendai
• April 2005:
– Apple store introduced in the Bullring shopping center in Birmingham
Expansion of Market
• June 2005:
– Opened its first store in Canada at the Yorkdal Shopping
Center in North York, Toronto
• July 2005:
– Bluewater Shopping Center in Kent opened
• Later on 2005:
– Apple opened the Meadow hall Store in Sheffield and the Trafford
Centre Store in Manchester (UK)
• January 2006:
– Recent additions in the London area include the Brent Cross Apple
Store
• 2006:
– Continuation of opening stores in Japan in the city of Sapporo
• September 2008:
– Apple Store in Westfield in Shepherd's Bush
1.4
Driven Marketing Strategy
• Launch of Apple 1983
– http://www.youtube.com/watch?v=lSiQA6KKyJo&
playnext=1&list=PL89CED0D07364D761
• Launch of Iphone
– http://www.youtube.com/watch?v=ftf4riVJyqw&f
eature=BF&list=FLEVDcUVUZAN8&index=1
Source:
http://www.koupoukis.gr/computer/apple/the-unofficial-steve-jobs-life-timeline-apple
http://www.gsmarena.com/apple_iphone_3g-pictures-2424.php
1.5
Product Line
MacBook iMac Mac mini Mac Pro Mac OS X
iPod Shuffle iPod Nano iPod Classic iPod Touch Apple TV
Source:
iPhone iPad www.apple.com
1.6
Apple’s Manufacturer
• Foxconn Technology Group
– World's largest maker of electronic components
• Hon Hai Precision Industry Co., Ltd.
– Won the Apple franchise in China
– Walled factory city of 270,000 employees
Source:
http://www.allnewsmac.com/2010/08/18/apples-major-manufacturer-
in-china-foxconn-to-hire-400000-workers-next-year/
Software and design Apple USA
Assembly Foxconn Taiwan
TFT-LCD Screen Sanyo Epson, Sharp, Japan
TMD
Video processor chip Samsung Korea
Touch screen overlay Balda Germany
Bluetooth chip Cambridge Silicon Radio UK
Chip Manufacturer TSMC, UMC Taiwan
Baseband IC Infineon Technology Germany
WIFI Chip Marvell USA
Touch screen control Broadcom USA
chip
CMOS chip Micron USA
NOR Flash ICs National Semi, Novatek US, TW
Case, Mechanical parts Catcher, Foxconn Tech Taiwan
Camera lens Largan Precision Taiwan
Camera module Altus-Tech, Primax, Lite Taiwan
on
Battery Charger Delta Electronics Taiwan
Timing Crystal TXC Taiwan
Passive components Cyntec Taiwan
Connector & cables Cheng Uei, Entery Taiwan
Source:
www.apple.com/iphone
Chapter 2
ENVIRONMENTAL ANALYSIS
Source:
http://movingtosiliconvalley.wordpress.com/
2.1
Geographical Structure for
Apple Computer
Source:
www.apple.com
2.2
Apple’s Network & its Variables
Flow of products, Services and marketing communications
Flow of Information, Financial flow and orders
PEST
Provider’s Network Company Distribution Network
Other companies of the
F
Design Authorized
network Retailers
I
N.A. N
Producers of Processors Wholesaler A
Direct Sales L
Producers of Chips apple.com
Buying Logistic H.R
L.A.
Producers of Batteries Wholesaler
Apple call center C
Producers of the Screen O
Europe N
Producers of Connectors Marketing Wholesaler S
Production Finance Own Stores
U
Cables Asia M
Wholesaler Web Sales E
Assemblers Competitors R
Business Facilitators
Supply Chain Marketing Channels
Figure 2.1
2.3
Structure of Apple’s Model
• Three broad industry categories:
– Software Engineering
– Hardware Manufacturing
– Retail
Source:
http://pix-soft.com/Industries.html
2.3.1
Software Engineering
• The core of the Apple genius
• Set the technological pace for functionality and the end-user
experience
• Focuses its developmental skills on a target
Source:
http://www.theappleloop.com/Home/monograph.html
2.3.2
Hardware Manufacturing
• Apple design and creativity attracts
• Built-in functionality is greater
• Interoperability with the Operating System is tighter and easier
Source:
http://www.devicenation.com/apple-iphone-4-still-not-being-recommended-by-
consumer-reports/
2.3.3
Retail
• Direct Contact with Consumers by establishing Apple Stores
– Assuring technology is introduced properly
• Flashy, boutique-like, with trained staff and plenty of opportunity to
touch, test and try
Source:
http://www.apple.com/retail/fifthavenue/
2.4
Participation of Countries in the
Market
Source:
http://www.itechcity.org/tag/apple-pc-market-share-graph
2.5
Apple Revenues
Source:
http://www.macworld.com/article/140162/2009/04/appleearnings.html
2.6
iPod Market Share
Source:
http://www.crunchgear.com/2007/10/12/apples-growth-leading-to-bad-
customer-service/
2.7
iPhone Market Share
Source:
http://www.socialmedianews.com.au/category/google/android
2.8
MacBook Market Share
Source:
http://www.ltjmanagement.com/post.cfm?PostID=8
2.9
Worldwide Total PC Shipments
Source:
http://www.fasterpony.com/apple-worlds-largest-pc-manufacturer-ipad/
2.10
Brand Awareness Analysis
Apple is well known for their innovative devices
Source:
http://www.scribd.com/doc/21275028/Apple-iPhone-Marketing-Plan
2.11
PEST Analysis
Political & Legal SocioCultural
• Legislative Policy • Tariff Barriers • Values and consumer • Influence of children in
(Labor) • Regulation of Foreign habits the buying process
• Technical Norms Trade • Fashion & media • Women in the labor
• Political Interest • Power Unions • Lifestyles market
• Tax Policy • Social mobility • Population in large cities
• Exchange Policy • Consumer behavior • Demography
• Protectionist Policy • Income distribution • Levels of education
Economical Technological
• Concentration of suppliers & shoppers • Level of investment of industries and universities in
• Business Life Cycle research & development
• Domestic & International Competition • Life cycle of products
• Inflation, Interest, and Exchange Rate • Fluctuation in the costs of technology
• Availability of Capital & Financing • Improvement & maintenance on the equipment
• Economic Integration • New Solution to technology
• Trading Blocs • Search of innovation Chart 2.3
2.12 Driver Change
Political & Legal SocioCultural
Impacts/ Actions Impacts/ Actions
Opportunity Opportunity
• Technical Norms • Adapt to new technical • Fashion, & media • Maintain the satisfaction of
standards o Lifestyles consumers’ needs, with
o Consumer behavior innovation
• Legislative Policy (Labor) • Reinforce US union forces in • Influence of children in • Diversification of product line
the Chinese labor the buying process
• Reduced protectionist policies • Increase in China’s • Population in large cities • Availability of product
importation, but take o Demography • Sustainable production
advantage of low cost in and sustainability labels
production with high quality • Communication that reaches
standards the consumer directly
• Levels of education • Educational communication
to parents & children
Chart 2.4
Driver Change
Economical Technological
Impacts/ Actions Impacts/ Actions
Opportunity Opportunity
• Concentration of suppliers • Productive alliances in • Level of investment of • Maintain the high intensity of
the domestic & international industries and universities in investment on research &
market research and development development in Silicon Valley.
• Innovating new technology
• Concentration of shoppers • Implement different • New Solution to technology that creates efficiency to the
strategies for pricing consumers’ lives.
• Personalization on the
• Domestic & International • Joint actions with the products by adding value
Competition government to increase
o Economic Integration political support for
o Trading Blocs export and import restrictions
Chart 2.4
2.13 Consolidation
Projects & Actions
• Similarity of products at lower cost • Aggressive marketing with implementation of Marketing 3.0
• Ease of Imitation (Chinese products) • Product & service differentiation with innovation of value to
Threats
• Increase cost of labor, raw materials and equipment avoid competition by cost
• Fluctuations in income and employment • Partnerships with suppliers to develop new materials
and equipment
• Technological New Age
• Investment in communication channels being directly and
• Laziness on the consumer like to depend on smart devices
investment in Apple Retail Stores in South America to
Oportunities
• Increased income and consumption increased consumption
• Women in the labor market
• Reduction in cost because of existing technologies & • New searches must continue for the hunt of
globalization new technologies with Silicon Valley and form new
partnerships with universities like MIT for research centers
suppliers
Figure 2.2
2.14
Determinants of the
Intensity of Competition
Suppliers
• Diverse market with high quality
employees and lower cost production
suppliers
• Low bargaining
power of suppliers of materials
Competition from substitutes
• The technogical market(computer,
New Entrants Competition in the industry cell phone, and portable player) do
not have replacement
• Threat of imitation from the • Competition for price and quality,
Chinese Market design, and brand strength • Substitution is among the model
• Threat of similarity in the with new implementation or
competition with lower cost • Differentiation in the design, consolidation
colors, sizes, and models
• High brand value in
some products minimizes the
substitution factors
Buyer power
• Price sensitivity (depending on line)
Bargaining power of retail stores
• Greater competition increases
bargaining power of buyers. Figure 2.3
2.15
Process of Shopping Decision
Processing Stage Occurring of the Ideas to Use Questions to Ask
Stage
Recognition of Need Necessity, fashion, and Strong and direct Frequency of purchase?
to Buy positioning to a special advertising which Motives?
social group impacts the consumers’ Seasonal?
lives Brand Image &
Awareness?
Looking for Use of internal sources Improve external Attributes observed
Information (Silicon Valley), external sources (party houses, during the choice?
sources (social groups, campaigns, and media)
blogs) Perception of the brand?
Evaluation of Take account of the Innovation on the How to differentiate?
Alternatives size, weight, comfort, comfortability & travel
durability, quality, and usage of the consumer Reaching different
price customers & market?
Chart 2.5
Process of Shopping Decision
Processing Stage Occurring of the Ideas to Use Questions to Ask
Stage
Shopping Decision Individual decision Enforce excellent Working attributes to
making in the store, customer assistance influence the purchase
based of comparison and set more Apple of the product instead
with other brands that retail stores to of competing?
offer similar product. emphasize to the
customer the service Reaching directly to the
being offered directly to consumers?
them.
Post-Purchase Create the fidelity of Customer service What is the
Behavior the consumer and have assistance 24/7 level of satisfaction?
him spread the brand International Warranty,
loyalty. and Personal Training Where is there better
service being offered?
Chart 2.5
2.16
Analysis of Shopping Decision Process
Processing Stage How is the Process Existing Opportunities
Positioning to a social group, which is the Create the motive to select and
Recognition of Need target market considering the consume more of your product line
to Buy necessity, and what is in style. and service.
Use of internal sources (Silicon Strengthen the brand in consumers'
Looking for Valley), external sources (social groups, minds by creating a one-to-one
Information blogs) relationship with the consumers,.
Take account of the size, weight, comfort, Customers are looking for portable
Evaluation of durability, quality, and price. devices that are beneficial for their
Alternatives usage.
Individual decision making in the Differentiate the product / brand,
store, based on comparison with other from the communication to the
Shopping Decision brands that offer similar product. point of sale. One must be
innovative, creative by being
animate and informative.
Post-Purchase Create the fidelity of the consumer and Customers are in need of having
Behavior have him spread the brand loyalty. brand loyalty. Seek into making the
client feel part of the family.
Chart 2.6
2.17
Collective Actions
Collective Actions Collective Actions Collective Actions Collective Actions
with Suppliers with channels with facilitators with competitors
Participation in the Orientation & training Implement a policy Joining forces to tax
design and production to technicians and of to reduce productio cuts, raising
of the product with sales representative n cost. barriers to imports an
comfortability and from the retail stores. d export subsidies
innovative tools
Regulation system Hold house parties, Alliances to reduce Market Research
assuring the events, show transportation cost
excellence & quality cases, and innovative and storage
development on the welcoming at their
products stores
Chart 2.7
Chapter 3
ANALYSIS OF THE COMPANY AND COMPETITORS
Source:
www.apple.com
www.blackberry.com
www.microsfot.com
3.1
Customer Orientation
Accomplished Activities
Marketing Ranking 0 to 10
1. Listens and considers the needs and desires of the customers in a well 9
defined market segments.
2. Distributes marketing efforts in accordance with the profit of a 9
potential long-term targeted segments.
9
3. Creates winning bids for the target segment.
4. Evaluates continuously the company's image and customer satisfaction. 10
5. Collects and evaluates continuously ideas for new products and improving
existing products and services to meet customer needs. 10
6. Influences all departments and employees of the company to consider
10
the customer in everything they think and practice.
7. Strives to offer the customers the "best solution". 10
8. Only make promises that they can deliver.
10
Ranking: Chart 3.1
0= Does not develop anything in relation to this activity
10= Employs many efforts in this activity
Customer Orientation
Accomplished Activities
Marketing Ranking 0 to 10
9. Transmits the needs and customers' ideas to those responsible for product 9
development.
10. Serve the same customers for a long period of time. 10
11. Sets a high standard of time for customer service, able to answer
their questions, address their complaints and solve their problems very 10
quickly and satisfactorily.
12. Disclose favorable news about the company and "damage control" of
unfavorable. 9
13. Acts as an internal customer and an advocate of the public in
order to improve the policies and practices of the company. 9
Ranking: Chart 3.1
0= Does not develop anything in relation to this activity
10= Employs many efforts in this activity
Customer Orientation
Accomplished Activities
Research & Development Ranking 0 to 10
1. Be attentive to global innovations, through web and others. 10
2. Devotes time to meet with customers and hear their problems. 10
3. Accepts the involvement of marketing and production, among
others, in each new project. 10
4. Tests and evaluates competitors' products.
10
5. Seeks to know the reactions of customers and asks for 9
suggestions.
6. Improves and enhances continuously, the product based 9
on market feedback.
Ranking: Chart 3.1
0= Does not develop anything in relation to this activity
10= Employs many efforts in this activity
Customer Orientation
Accomplished Activities
Shopping and Production Ranking 0 to 10
1. Stimulate innovation that continues in the suppliers, not letting them accommodate. 10
2. Proactively seeks the best suppliers, rather than choose only among those who seek 9
them.
3. Seeking to reduce transaction costs of long relationships duration with a smaller 10
number of reliable suppliers and high quality.
9
4. Does not make concessions on quality to save on price.
5. Invites customers to visit and learn about their company. 3
6. They are always striving to produce goods faster and / or a 7
lower cost.
7. Improve continuously the quality of the product, trying to 10
achieve a zero rate of defects.
8. Meet customer requirements "personalization, "when it 10
can be done profitably.
Ranking:
0= Does not develop anything in relation to this activity
Chart 3.1
10= Employs many efforts in this activity
Customer Orientation
Accomplished Activities
Accounting & Finance Ranking 0 to 10
1. Prepare, periodically, reports of "profitability" by product market segment, 9
geographic areas (regions, sales territories), order size and individual clients.
2. Prepare invoices appropriately to customer needs and answer their questions quickly
10
and courteously.
3. Understand and support the marketing investments (ex., institutional
10
advertising) that produces preference and customer loyalty in the long term.
4. Adequacy of the financial package of the financial needs of the customers. 8
5. Take quick decisions about the client's ability to meet its financial commitments. 6
Other employees that have contact with customers Ranking 0 to 10
Competitive, caring, cheerful, reliable and responsive. 10
Ranking: Chart 3.1
0= Does not develop anything in relation to this activity
10= Employs many efforts in this activity
3.2 Direct and Indirect
Major Competitors
Large companies with strong performance in domestic market
• Microsoft (computer software & handheld operating system)
• Hewlett Packard (computer manufacturer)
• Sony (computer manufacturer)
• Dell (computer manufacturer)
• Blackberry (cell phone manufacturer)
• HTC (cell phone manufacturer)
• Samsung (cell phone manufacturer)
• Nokia (cell phone manufacturer)
Imitation Products Retailers
• Chinesse portable players • Best Buy
• Chinesse cell phones • Micro Center
• Walmart
• Radio Shack
• Amazon
3.3
Information about the Competitor
Survey Information on Competitor – Microsoft
1. Market 4. Communication 7. Finance
Considered a monopolistic in the Increased communication Assets were valued at $41 billion in
licensing of the software. in various media channels associated February 2011.
with educational sponsorships, and
2. Buyers direct communication at the 8. Administration
A very common computer software point of sales strengthening the Technological capacitated, innovative
that is affordable to grand majority of company’s brands. and stable company, self-sufficient
social status. productive, vertically integrated
5. Distribution Channel operations control and a motivated
3. Products, Services, Brands and Individually distributed where it can be team. High investments in research,
Symbols bought online at Microsoft stores or any of and development.
their online distributors, retail store, or
Commercialization of computer
Microsoft donation
software with 5 divisions (Windows &
Windows Live Division, Server and
6. Sales Force
Tools, Online Services Division, Sales representatives, and distributors at
Microsoft Business Division, and the online Microsoft store or retailer stores.
Entertainment and Devices Division).
Products has brand awareness since
1984 with continuous innovation.
Brands: Windows and Office
Chart 3.2
3.4
Description of Principal Competitors
Microsoft Blackberry
80% of the Market Share Mayor Competitor in the
Principal in computer software. cell phone Industry
Characteristics
Microsoft Original Research In Motion Ltd.
Principal Supplier
Equipment Manufacturer
Principal Computer & Software Cell Phones
Segment
Figure 3.3
Description of Principal Competitors
Microsoft Blackberry
Sales representatives & Sales representatives &
Sales Force &
distributors worldwide. distributors worldwide.
Compensation
In 2002 formed a Innovation of
strategic agreement Operating System with
with High Tech blackberry messenger,
Computer (HTC) a which enables the user
Strategic smartphone to send & receive
Movememnts manufacturer to messages through data
distribute Windows plan.
Mobile Operating
system.
Figure 3.3
3.5 Comparison between the
Company and its Competitor
Evaluation Factors Apple Microsoft Blackberry
Quality 10 8 8
Style 10 8 8
Brands 10 10 10
Cost 7 10 8
Level of Price 7 9 8
Publicity 7 7 7
Personal Sales 10 7 9
Promotion 8 8 6
Advertisement 8 8 7
Channel of Distribution 10 10 10
Coverage of the Channels 10 10 10
Localization 10 10 10
Transportation System 8 8 8
Effectiveness 10 10 10
Efficiency 10 10 10
Capacity Utilization 9 9 9
TOTAL 144 142 138 Chart 3.3
3.6 Classification of Company’s
Resources
Relevant Evaluation of the
Tangible Resources Key Indicators
Characteristics Company
Estimated every 20 days their • Equity 9
inventory is turned in to cash. • Cash Flow 9
Financial Resources This is a very high inventory • Tax Credit 6
turn over.
Market value of fixed assets. 8
Has their production in China
with low cost and now Depreciation of
expanded their production also equipment.
to Brazil. 9
Scale production of the
Important Notes: factories.
Physical Resources 9
Know how on software & Flexibilities of fixed assets.
design plus chip.
Size, location, hi-tech Use of strategic alliances in 9
equipment. production.
10
Chart 3.4
Classification of Company’s
Resources
Intangible Evaluation of the
Relevant Characteristics Key Indicators
Resources Company
• Number of patents (563) 10
Intellectual property,
portfolio of patents,
Technological copyrights, trade secrets.
Resources Research & Development in • Percentage of their Operating
Income in R&D (34%) 10
Brand reputation among • Brand recognition 10
consumers.
Company's reputation for • Brand value 10
relation to quantity and
reliability of their • Percentage of repeating 9
products and services. purchases
Reputation Reputation with
providers, agencies • Objective measures of 9
government, banks and the performance products
Community. comparative research on the
reputation of the
organization.
Values, traditions and social norms • Organizational Climate 10
Culture
Chart 3.4
Classification of Company’s
Resources
Evaluation of the
Human Resource Relevant Characteristics Key Indicators
Company
Education, training and Educational qualifications, 10
experience of employees. technical and professional
Skills available to the company. employees.
Adaptability of employees Remuneration for the 10
and contribution to the flexibility of industry.
organizational strategy.
2
Collaborative and social skills of offic Percentage of days
RH ials determine the company's ability lost with the suspension of
to transform human work or industrial disputes.
resources in organizational 10
capabilities. Way they talk, admire and have
affection for the company.
Commitment and loyalty of
officials determine the company's Employees with pay consistent
ability to achieve and maintain a with the market 10
competitive advantage.
Innovation of products, process and Advances in R&D. 10
Creativity form of work. Number of innovative launches 10
Chart 3.4
3.7
Analysis Critical Factors for Success
Prerequisites for the success of
the company
Who does the client want? How does the company succeeds the
competition?
Analysis of Demand
The clients are in search of high quality Analysis of Competitors
product that offers comfortability
matching the expectation of
differentiation in design and style. Competitive advantage is very important
where it involves innovation and
differentiation on the products. Their is being
high investment in R&D to match the
consumers’ needs and create desire and needs
to them. In addition, creating hi-tech,
Critical Factors For Success designing product at an approachable price.
•Innovation in design & raw materials
•Differentiation in style & models
•Value
•Customer Service Excellence
Figure 3.6
3.8 Comparison and Ponderation of
Critical Factors of Success
Critical Factors of
Weight Apple Grade Microsoft Grade Blackberry Grade
Sucess
Quality 30 10 300 8 300 8 240
Design 20 10 200 8 160 8 160
Brand 15 10 150 10 150 10 150
Price 10 7 70 10 100 8 80
Distribution Channel
10 10 100 10 100 10 100
Post-Behavior 15 10 150 8 120 8 120
Total 100 970
970 930 850
Chart 3.5
3.9 Consolidation
Actions & Projects
Large Scale of Production
Up-to-Date Technology with efficient 1. The prices of “Apple products” may
Strong Points
machinery not be reduced so much because
Creative Design with well known brand their product represents quality and
Top leader Research & Development efficiency with top rated customer
Marketing 3.0 service.
Excellent Post-Behavior 2. The United States customer service
must offer bilingual service, it can
Points to Improve
not just offer english speaking
service.
Expand their market in Retail Stores 3. The Research & Development must
especially Latin America expand their institution considering
MIT and other centers in the world.
Figure 3.7
Chapter 4
Establishing the Objectives
Source:
http://www.geekpedia.com/icon58_Ruler-Pencil-and-Paper.html
4.1 Objective of Strategic Planning of
Marketing Management
• Continue their leading innovation and designs in the markets
consumer electronics, computer software, and personal computers.
• Reaching the final consumer through a direct channel of
communication, were the client is well informed & instructed on the
beneficial usage of their product.
• Expand their market expansion to South America on behalf of their
retail stores at a strategic location.
Objective of Strategic Planning of
Marketing Management
• Increase the market share of the U.S and U.K. aiming at a 7% in the
computer market plus the PDA/Phone market at least 2% with the
launch of iPhone 4 and iPad 2.
• Extend on the Apple brand name and link to the established
meaningful positioning.
• Enlarge on Apples image of innovation, quality, and value.
• Measure the awareness and response in order to make adjustments to
the marketing campaigns as necessary.
Objective of Strategic Planning of
Marketing Management
Criteria 2011 2012 2013 2014
Revenue $97,837.50 $ 111,966.02 $137,718.21 $192,805.48
NET PROFIT $23,121 .45 $31,117.04 $51.654.28 $87,812.27
Sales Margin 24% 28% 38% 46%
Financial data in U.S. Dollars Chart 4.2
Values in Millions
Source:
http://www.workitmom.com/bloggers/corneredoffice/category/like-talking-but-with-more-
typing/page/3/?wpvar=1&wpvar=1
Chapter 5
Strategies for Achieving the Goals
Source:
http://www.psychologytoday.com/blog/dont-delay/200902/approaching-success-
avoiding-the-undesired-does-goal-type-matter
5.1
Generic Business Strategies
• The generic strategy implemented by Apple is Diversification
• Focus on brand management and creation of a strong Brand
Equity
• The value creation is the main strength
• The great quality and brand image makes customers less price
sensitive
• Thanks to innovation in their products, they have very few
competitors at the same level
5.2
Matrix of Strategic Alternatives
Leadership sought by the Advantages of this alternative strategy
company today
• Leadership based on innovation and • The strengthening of the brand allows
differentiation entry into new markets.
• Pioneers and leading brand • Innovation creates new needs for
• Perceived value for customers: less price consumers and therefore wishes to obtain a
sensitive, more quality interested product.
• Best-known products (iPod, iPhone, Mac Book) • The added value perceived by customers is
an excellent word of mouth (recommendation).
What is the best alternative today ? Why the first alternative is not viable ?
Apple must maintain their same philosophy of In this case, the first alternative is viable because
being leaders in research & development to Apple is one of the top leaders in each of their
maintain their leadership for their growth in the segments. In this case, they must be sustainable with
market. In addition, penetrate strongly on the their strategies and keep growing.
operating system for Mac.
New alternative in 5 years Advantage of the future alternative
• Acquisition of small competitors around the • Increase the market share
world • More authorized retailer stores around the world
• Better distribution channels
Chart 5.2
5.3
Matrix of Segmentation
T
a Big
r
g
e
t Medium
M
a
r Small
k
e
t
High Medium Low
Return Figure 5.3
5.4
Options of Differentiation
Type of
Concept Ideas
Strategies
• Product innovation and product line
Products/ Features of the products they do best in extension
Quality terms of reliability, durability and performance • Using the best raw materials to ensure
the best quality products
• Attractive and distinguishable packages,
Offer something really different and unique. that calls all customers attention
Design Include: design, production, visual symbols and• Unique products with a distinct design
brand identification • Brand identification based on product
design
An image is created for the product and are• Deliver the company’s image to consumers in a
those differences in a product that does special way so that Apple is perceived as a
Image not involve enhancing of performance in an company that gives technology, simplicity and
intrinsic way innovation through all of its products
Chart 5.4
Options of Differentiation
Type of
Concept Ideas
Strategies
• Intensify distribution and authorized
It is the basis of a parallel differentiation of the retailers stores around the world
product, a based support services.• Sales staff willing to help, well trained and
Services Basis for reaching other substantial form of with personality that match the company’s
differentiation: support and services profile (Ex. Attend using an Apple product)
• Stands for demonstration of products.
• Training sales staff in all the stores, where
By hiring and training the people better so the products are sold, creating brand equity
they are more qualified than their
competitors. • Support and trained people for technological
Talent events
Management • Encourage sales staff to emphasize on the
This way they improve the characteristics of brand when they are selling
competence, courtesy, credibility, reliability,
responsibility and communication. • Search for innovative and creative
professionals
Chart 5.4
5.5
Market Positioning
Without a doubt Apple is …
THE MARKET LEADER
• Excellent offer
WHY ? • Recognition
• Superior distribution
• Resources
• Competition relatively weak Source:
http://www.nqlogic.com/2010/01/ipa
d-or-apples-ultimate-connected.html
5.6
Type of Growth
Intensive Integrated Diversified
Source:
http://www.blahblahtech.com/2008/07/apples-benign-digital-dictatorship.html
5.6.1
Strategies for Growth
Type of Strategy for
How can it be achieved? Ideas
growth
• Stimulate current consumers to
buy larger quantities • Increased the authorized retailer stores to
Increased • Making communications and be closer to the customers
disseminating the benefits of the • For those technology-lovers, show details
participation in products of the innovation and benefits of the
today's market • Attract consumers from products.
• competitors • Increased advertising
• Convert non-users into users
• New markets for existing • International expansion
products
• Development of new products
• New groups of potential
customers in its area of • Strengthening the communication
Developing operation channels and image abroad.
new markets • Distribution channels in its • Allow testing experience when
current markets • customers are in store
• Expansion of operation to other
regions
Chart 5.6
Strategies for Growth
Type of Strategy for
How can it be achieved? Ideas
growth
• Greater diversification of models
• New products for current markets • New accessories products. Ex: screen
Product • Different models savers, computer bags, cases for cell
Development • Different quality levels phone, and chargers
• Innovations • New value association for the products
(pioneers and environmental friendly)
Concentric • Creation of a complete line of
• New products or opportunities
Diversification accessories for all products
• Synergies in marketing and
• Focus on a new market, segmented by
technology with current products
age. Ex: Kids (Future loyal buyers)
• New and different products that
• meet the same segment of • Development and Diversification of the
Horizontal • current consumers variety of products, entering other
markets
Diversification • Products are not technologically
• related to the current product • New line of television products
lines
Chart 5.6
Strategies for Growth
Type of Strategy for
How can be achieved? Ideas
growth
• Entry into new markets, especially of
accessories products
Conglomerate New businesses that are not
• Business expansion taking advantage of
related to its technology,
Diversification the raw materials and know-how
products and current markets
• Design and produce their own package in
an innovative way
Vertical
The company acquires a supplier as a • Acquire one of the suppliers factory on
Integration going growth strategy China
back
• Expansion of authorized retailer stores
• License around the world to the sale of
Vertical Integration Acquisition of distributor as a strategy their products
going Forward to go forward in the chain. • Create a “experimental store” where
customers go and learn how to use the
products
• Purchase small competitors around the
Horizontal
Purchase of competitors world to create new factories and have
Integration different place of productions
Chart 5.6
5.7
Motives for Differentiation
Reason to seek
How it can be done, or what are Alternatives for obtaining
a diversification
the incentives in search of? benefits without diversification
strategy
• Attract the most qualified, creative,
Management forward thinking and innovate • Focus on achieving higher
Issues employees and executives, to give status and salary level
them big challenges
• Shareholders can diversify their
• Diversification of product line portfolio of shares in other
Risk Reduction • Diversification of market segments companies
• Diversification of distribution channels • Resources may be cheaper
in another source
• Launching new products with
• Search larger market scale and
Profitability high returns (New business
greater profitability
attractiveness)
Chart 5.7
Motives for Differentiation
Reason to seek
How it can be done, or what are Alternatives for obtaining
a diversification
the incentives in search of? benefits without diversification
strategy
• Contracts, Joint Ventures,
Licensing, Strategic
Alliances and Franchising can
• Increase the purchase made by the
Market power company
provide these benefits
• Opt for cooperative activities
and associations
• Contracts, Joint Ventures, Licensing,
Strategic Alliances and
• Share research costs (firms in
Franchising can provide these
other industries)
Economy of scope • Share distribution centers
benefits
(improves negotiation channels)
• Opt for cooperative activities
and associations
• Outsourcing of services that are
Synergy between • Conduct joint strategic management
not related to value-generating
business units for all business units
activities of the brand
Chart 5.7
5.8
Matrix BCG
iPod *MacBook
iPhone
iPad
*Note: MacBook was one of the question mark of Apple, but thanks
to investment it is now turning into a start Figure 5.4
Source:
http://www.maxi-pedia.com/BCG+matrix+model
5.9
Matrix of Market Attractiveness
COMPETITIVE POSITION
High Medium Low
Protect the position Invest to grow Grow selectively
MARKET ATTRACTIVENESS
iPod MacBook
High
Grow selectively Selectivity / Limited expansion or
Medium
iPhone Focus on profit deceleration
iPad
Protect and refocus Protect and refocus Abandon
Low
Figure 5.5
GR/McKinsey
5.10 Actions for Creating and Sustaining
Competitive Advantage
Ways of creating
How to create and sustain that advantage in your business?
competitive advantage
• Combine the experience curve with company’s technology to increased productivity
Take advantage of the
• Using more contact with clients
experience curve
• Create Brand Awareness
Create network • Great events when launching a new product
externality • Associate products with important people of the technology world
• Promote the brand as a pioneer, focusing on innovation
Create reputation • Improve sales staff and distribution channels
Create legal • Search for new products with patents
• Register product designs, brands, logos, and software
restrictions
• Maintain good relationships with suppliers and long-term relationships
Create superior • Association with others to ensure a presence in distribution channels
approach • Greater control of suppliers
Create economies • Focus heavily on product innovation creating barriers to entry for new competitors
of scale
• Show customers how simple is to use your product and how complicated is the one
Create customer
of your competitor.
switching costs • Show your strengths Chart 5.8
Chapter 6
Decisions of
Products, Services, Brands and Packages
Source:
www.apple.com
6.1
Product Decisions
• Apple’s benefit of why consumer should choose
their product:
― Apple position its products in high standard
quality with innovating design and functions
― Offers international warranty with renewal of
gap coverage
― Provides consumers with personalized technical
support
6.2
Product Analysis
Performance Satisfaction
Features Initiates innovating products with efficient functions
Characteristics High quality processor , high speed network, sustainable battery life and
the best software applications for consumers.
Reliability 100% international warranty covering hardware & software and
personalized technical support
Comfortability Light weight product that fits in a small bag and pocket devices.
Durability Lifetime products with extended warranty for any defects.
Services Personalized technical support in repairing the device or teaching the
consumer how to operate the device.
Design Innovating pocket devices that is very appealing to the consumers as a
luxury product.
Perception of Quality Creation of brand image of being a sophisticated brand with the best
quality standards in design and function
Source:
Garvin (1987)
6.3
Decisions on the Product Line
• Apple covers the sectors:
– Portable Computer & Desktop
– Portable Music Device
– Portable Mobile Phone
– Television
• Strategy over the products
– Satisfies consumers’ needs and desires and also
creating new necessity to the consumers
6.3.1
Analysis of the Products’ Line
Product Volume(u) Sales Gross margin Gross profit
5 Macbook 8.000.000 $ 2.400.000.000,00 20% $ 480.000.000,00
6 Imac 10.000.000 $ 5.000.000.000,00 25% $ 1.250.000.000,00
4 Mac mini 1.500.000 $ 75.000.000,00 20% $ 15.000.000,00
3 Mac pro 1.000.000 $ 50.000.000,00 20% $ 10.000.000,00
1 Mac OS X 1.000.000 $ 40.000.000,00 15% $ 6.000.000,00
2 Ipod Shuffle 3.000.000 $ 90.000.000,00 17% $ 15.300.000,00
9 Ipod Nano 7.000.000 $ 350.000.000,00 28% $ 98.000.000,00
7 Ipod Classic 4.000.000 $ 240.000.000,00 25% $ 60.000.000,00
8 Ipod touch 5.000.000 $ 200.000.000,00 27% $ 54.000.000,00
10 Apple TV 1.000.000 $ 100.000.000,00 30% $ 30.000.000,00
12 Iphone 16.500.000 $ 2.475.000.000,00 35% $ 866.250.000,00
11 Ipad 10.500.000 $ 2.100.000.000,00 30% $ 630.000.000,00
TOTAL 68.500.000 $ 13.120.000.000,00 $ 3.514.550.000,00
Figure 6.1
6.3.2
Analysis of the Products’ Line II
ABC Curve - Volume
Figure 6.2
Analysis of the Products’ Line II
ABC Curve - Sales
Figure 6.2
Analysis of Product Line II
ABC Curve – Gross Profit
Figure 6.2
6.4
Product Comparison
20.000.000
11
15.000.000
10.000.000 2 12; 10.500.000
Volume
1
7
5.000.000 9
8
6
3 4 5 10
0
-2 0 2 4 6 8 10 12 14
-5.000.000
Margem
Figure 6.3
6.5
Products’ Life Cycle
S
a
l
e
s
V
o
l
u
m
e
Period
Introduction Growth Maturity Decline
Figure 6.4
Source:
http://www.apple.com
6.6
Development of New Products
• Increase Apple’s product line by developing an “interactive television”
with Internet access and alongside features of accessories:
printers, keyboards, speakers, headphone
Products Market Size Contribution Access Number of Investment Total
Margin Channels Competitors Needed
Television 8 5 6 8 9 74
Printer 5 4 9 8 6 69
Mouse 3 1 7 6 2 42
Keyboard 2 1 7 5 2 39.5
Headphone 3 2 7 4 2 41
Speaker 4 2 7 4 2 43
Weight 2 2 3 15 2
Source:
Marcos Fava Neves
6.6.1
Apple’s Launch in 2011
iMac Line
• The product now features next generation processors, faster graphics
and the Thunderbolt port
• Offers quad-core Intel Core i5 processors or optional Core i7
processors
• Faster AMD Radeon HD graphics processors and a new built-in
FaceTime HD camera for video calls
iPad 2
• High speed network with new expandable flash memory
• All new-design with a third of an inch thick, down from a half, and a
barely-noticeable smidge shorter and narrower
• Built in camera offers HD video recording at 720p, up to 30 frames per
second, with 960x720/72dpi
6.7
Principal Brand Decisions
Decision about the Brand Action from Apple
Trademark use Apple has created the name brand for
their electronic devices with the image of
high quality standard and legal protection
on their genuine operating system.
Brand Sponsorship Does not use brand sponsorship.
Name Used Global Brand
Brand Strategy Apple uses the strategy to extend product
lines and the introduction of new
versions of their products.
Brand Repositioning High quality standard products and
always innovating new functions every six
months
Chart 6.1
6.8
Amplitude of Packaging and Ideas
Dimensions Function Improvement Points
Primary Functions • Contain Innovating design that is attracting to
• Protect the consumer but also protective for
• Transport the device.
Technological • Product Preservation Investigate for packaging alternatives,
• Conditioning System since the main raw material used in
• New Material making plastic comes from oil.
Marketing • Attractive to the consumer Reduce their cost in packaging raw
• Transmit Information materials to reduce their pollution.
• Override the pricing obstacle
Sociocultural • Culture expression through More participation in social
the development of responsibility activities like foundation
countries for education and homeless people.
Environment • Urban waste Showing that the company is concerned
• Recycling about the recycling of the packaging of
their products.
Chart 6.2
6.9 Collective Actions for the Brands
Products, Services, & Packaging
Actions Ideas for Apple
The same structure for packaging Partnering with a company
development specialized in packing to reduce their
cost.
Sharing Infrastructure services Partnering with a company in the
same sector to offer effective service
in the distribution channel
Chart 6.3
Chapter 7
Decisions in Communication
Source:
http://rockiesmarketing.com/marketing-education/differences-in-
effectiveness-of-direct-marketing-and-marketing-via-mass-media
7.1
Apple’s Development of
Communication
• Satisfying the consumers’ need, but instantly
creating the desire for the product
• Strategies for Communication
— Built in Advertisement
— Brand Awareness
— Brand Positioning
7.2
Identification of Target Audience
and Communication Actions
Target Priority Objectives of message Message Tools
Audience
Children Average Arouse desire for the children to ask Apple also Built in
their parents to purchase the item for does not Advertisement in
them. grow up by cartoons, movies
itself, Apple and TV series.
is for kids,
also.
Youth High Show that the day is easier and more Be Tuned all Internet shopping,
fun with the products. Day with social network
friends, and pages, built in
the social advertisement in
network. movies and
commercials.
Chart 7.1
Identification of Target Audience
and Communication Actions
Target Priority Objectives of message Message Tools
Audience
Adults High Facilitates the work activities. Time is costful, use Advertising in media
it wisely. businesses and
billboards.
Seniors Low Show the children and grandchildren Maintain Advertising in prime
are using communication time
with all family
members and
enjoy your day
Chart 7.1
7.3 Objective of Communication
• Reaching each product line to its target audience
• Associating the brand image of high quality
products
• Increasing demand at least for their products
through the consumer's desire
• Associate the brand with high technology
7.4
Principal Communication Tools
Sales Direct
Advertisement Public Relations Personal Sales
Promotion Marketing
• TV
• Internet • Contests • Events for • Presentation
• Electronic
• Commercials • Fair shows product • Lobbying
sales
• Movies • Exhibitions Presentation • Exhibitions
• Catalogs
Chart 7.4
7.5
Tools for Sales Promotion
Focused for Focused for Sales Focused for Focused for Final
Intermediates Force Industrial Market Consumer
• Rebates • Contests • Catalogs • Rewards
• Anticipated • Catalogs • Fair shows • Contests
purchase • Rewards • Seminars • Fidelity Program
• Special Offers • House Parties • Indirect Discounts
• Exhibitions
• Contests
Chart 7.5
7.6
Methods for Communication Budget
Method Possible Advantages Possible Disadvantages
Ignores the role of
promotion on sales volume.
Available Resources Simplicity
Hampers the long-term
planning
Expenses are related to the
turnover. Circular reasoning
Percentage of Sales Relationship between cost of Does not consider market
promotion, selling price and profit opportunities
per unit
Reputation, resources,
Peace of mind
According to competition opportunities and objectives
that will not "lose ground"
are different
• Allows the exercise
It is more complex because
•Allows to think and create
Objective Vs. Task it requires making the
• Force to record data
whole process
•create business intelligence
Chart 7.6
Note: The method applied by Apple to determine the communication budget is
Objective Vs. Task. A great way to develop it strategies
7.6.1
Layout of Communication Budget
Jan. - March April - June July – Sept. Oct. – Dec. Total
2011 2011 2011 2011
Advertisement $200.000.000 $200.000.000 $200.000.000 $200.000.000 $800.000.000
Sales $100.000.000 $100.000.000 $100.000.000 $100.000.000 $400.000.000
Promotion
Public $100.000.000 $100.500.000 $100.500.000 $100.500.000 $401.500.000
Relations
Personal Sales $100.000.000 $100.000.000 $100.000.000 $100.000.000 $400.000.000
Direct $25.000.000 $25.000.000 $25.000.000 $25.000.000 $100.000.000
Marketing
Grand Total $525.000.000 $525.000.000 $525.000.000 $525.000.000 $2.101.500.000
Figure 7.2
7.7
Opportunities for
Collectives Actions
Action Opportunity for Apple
Joint Advertisement Create key alliances with mobile operators for
the packaging of mobile services.
Joint Sales Promotion In key retail stores and even their own retail
stores, certain time of year give out a limited
buy one and get one free bundle.
Joint Participation in Fair Shows Smart alliances with businesses like banks, and
insurance companies to continue the
progression of built in advertisements.
Chart 7.7
Chapter 8
Decisions of Channel Distribution
Source:
http://www.cultofmac.com/the-best-little-apple-store-in-texas/7493
8.1
Understanding the Flow of
Marketing and Channel Distribution
Producers & Physical Distribution Network Physical
Processors Possession Possession
Design Authorized
Property Retailers Property
NA Wholesaler
Producers of processors Promotion Promotion
FINAL
Direct Sales
Producers of Chips Negotiation Negotiation CONSUMERS
apple.com
LA Wholesaler
Producers of Batteries Information Information
Apple call center Industrials
Producers of the Screen Financing Financing Home
Europe
Producers of Connectors Risk Wholesaler Own Stores Risk
Cables Order Order
Asia
Wholesaler Web Sales Payment
Assemblers Payment
Service Service
A
Company First Intermediate Second Intermediate Final Consumer or User
Wholesalers around the world Retailers Home
Sites of sales Industrial
Own stores
“The captain of the channel”
• Pioneers & followers of
• Innovation • Strong Relationship trends
• Direct Sales • Satisfaction
Figure 8.1
8.2
Impacts on Distribution Channels
Trends Implications for channels Possible actions
Difficulty of the exportation Be aware of possible behavioral
Political & Legal process changes
Difficulty of production process Creation of factories in emerging
Economical countries. Example: Brazil
Lose competitiveness with Creation of factories
difficult access to different
SocioCultural
markets
Lose competitiveness with Creating partnerships with
difficult access to products and universities, and invest in
Technological
services new technology
Chart 8.2
8.3
Environmental Analysis
Focus: Identification of impacts of networks for current channels
8.4
Objectives of the
Company with Distribution Channels
• Apple Store (Direct Sales):
– High profit margin in its own distribution channel.
• Retailers:
– It works as a direct place where customers have great sensory experience and
knowledge of the products.
• Shopping Center:
– They will have to invest in services and entertainment, things that motivate
people to leave home and go buy.
• Other distribution channels:
– They must add value to their services and specialize in order to achieve
expected sales.
8.5 Analysis of the Consumers’ needs
related to Distribution Channels
Excellent! Now I can buy Apple
What do you think about the products with more security and
Apple Online Store in Brazil? with an accessible price
The price is still high! I do not buy
any Apple products, until they go
8%
11% down
42% Normal, but I do not use it
15%
Good, but I prefer to buy in other web
24% sites. It is more economic
I am just going to buy here, to be
able to personalize my iPod with free
laser engraving
Source:
http://www.ipodschool.com
8.6
Selection’s criteria for
Distribution Channels’ Members
Selection Criteria Apple Store – Direct Sales
Financial Conditions Guarantees and safe credits because it belongs to the brand
Sales Staff Specialized, trained and prepared
Sales Performance Turnover USD $ 3 billion (20% of sales)
Product Lines Every product lines are exclusive
Reputation Reflect the brands’ personality
Market Coverage Restricted in some localities and countries, but it is rising
Attitudes Ability to persuade due to the differentiation their products
Size Restricted to the ability of sales
Experience Differentiation by sensory and emotional experience
Managerial factors Even with high operating costs, Apple continues to invest
Support services Strictly organized and directed
Market Information Available at Apple stores
Structure At strategic points of sale
Coordination Direct marketing oriented to service’s innovation
Control Total control. Retail margins
Chart 8.3
8.7 Activities for Build Contracts
Products + Services + Communication
Apple Company Intermediaries Final Consumer
• Produce • Deliver to consumers • Buys regularity
• Delivers to • Add information • Communicate with
intermediates material others consumers
• Discloses the Brand • Communicate the
Activities name main attributes of the
• Define distribution products to final
policies consumers
• Prepare contracts • Give terms of • Payments of the
• Evaluate and give payments purchases
credits and terms of • Review the policies of
Transactions payments the commercial
actions
• Development of • Provides distribution • Keep contact with the
trainings structure company
• Promotional actions • Areas and • Demonstrate
• Establish the targets establishing sales expectations
Relationship markets and areas goals • Suggest the company to
• Implement Actions known people
• Take advantage of the
promotional actions
Information + Orders + Payments
Figure 8.2
8.8
Managment of Distribution Channel
Case: Mobimax
• "Apple chose us because we are specialize in
serving the retail, and also we are the only channel
partner specializing in automotive. Also, because
there is a great synergy between our products with
those from Apple and the excellent results achieved
recently in the partnership Mobimax,”
said the General Director of Mobimax, Mario
W.Okuno.
Source:
http://www.conectecomunicacao.com.br
8.9
Collectives Actions in Distribution
• Initially, this strategy Mobimax invested around
£ 1.5 million to distribute approximately
150 points of sale throughout the country.
• It is expected to be marketed more
than 1,500 pieces per month.
• The Mobimax has outsourced all of the
storage and logistics to meet quickly and
securely across Brazil.
Source:
http://www.conectecomunicacao.com.br
8.10 Network Approach in
Distribution Channels
Reasons to use the network approach and
Ideas
collective actions in distribution channels
Apple could turn more attractive the
distribution channels offering
Strengthening the channels of a single company
complementary products such as screen
protectors, and covers
Certain brands targeted at large retail
stores can be distributed along with the
Gains from economies of scale to better competition.
exploit the assets of the distribution function
Distribution to stores and brands with
higher value should be individually.
Apple can meet its channels to achieve
brand awareness events in conjunction
with companies in different segments.
Joint events
Ex: New Product Launching Chart 8.8
Chart 8.8
Chapter 9
Decisions in Sales Force
Source:
http://llmiqvyn.blogspot.com/2011/05/effectiveness-at-work.html
9.1
Apple’s Business Strategy of
Marketing and Sales Force
• Apple’s overall strategy is directed towards product
differentiation and innovation.
• Sole focus on the target market of medium-high class.
• Recommendation in relation to the sales force:
– Hiring quality staff
– Special dedication to the evaluation & performance of the
staff
– Expertise in operations and opportunities associated with
the target market
9.2
Porter’s Strategy and Implication
for Sales Force applied in Apple
Strategy Implication in the Sales Forces
Cost • Market participation in • Reducing Cost
middle and high class • High turnover of sales
Differentiation • Personalized service with one • Exclusive Training
to one attention • Special Reward Program
• One of a kind brand with • Excellent pay in exchange for
high quality standards, high quality sales effort
attractive designs and
appealing functions
Niche • Selected target market • Expertise in positioning
represents 20% of Apple’s themselves as price and market
sales leaders
Chart 9.1
9.3
Establishing the Segments and
Focus on the Performance
S Apple’s Positioning
a
l
e H
s I
G
H
O
p Key Accounts Breaking Beliefs
p
o L
r O
t W
u “Keep them Happy” “Leave the door open”
n
i
t
y High Customer Participation Low Customer Participation
CLIENTE CLIENTE
Figure 9.1
9.4
Analysis of the Performance
of Apple’s Product
Source:
http://pt.wikinoticia.com
9.5
Efficiency and Effectiveness in
the Communication Methods
Low Cost per Publicity
exposure by
customer
Institutional
Efficiency Navigation
Effectiveness
High Sales
per exposure
by customer
Figure 9.3
9.5.1
Analysis of the Communication
Method
Source:
http://reflexoesdigitais.com.br
9.6
Principal Decisions and
Description of Apple’s sales
Decisions of the Organization Description of the Decision
• Currently, each representative has goals, and for every goal met
1. Determination of sales
there is a reward. Apple needs to continue this system to maintain
quotas
their sales quota high.
2. Analysis of representative • The sales function is internal in order to continue assuring personal
versus employed salesman. training and one-to-one attention for the customers .
3. Specialization or structuring • Sales force is divided by product line; therefore, the seller is well
the sales force trained in his area.
4. Definition of the number of
• Stipulated according to the markets’ demand.
sellers
5. Definition and alignment • Based in leading the growth of projections of the regional market
of sales territory is reviewed periodically.
6. Establishment of hierarchical
• The hierachy level of sales managament must be veritcal to
levels and extent control of
maintian effective communication and supervision control.
sales management
7. The role of regional sales
• Assure the control and sales is being kept.
manager
Chart 9.2
9.7
Steps for Developing the Plan
for Quotas and Incentives
Expected key activities: pre-sales, sales Employed Sales Representatives: Representative must be well
and after sales inform of their specialized product to sale, In addition, the
reprsentative must perform follow-up on the customers.
How to Employed Sales Representatives: Periodically training with
turn these activities into performance? evaluation to maintain a close relationship.
What is the estimated target for Employed Sales Representatives: Maintain the sales quota
high on the existing product and increase the sales on the 2011
each index?
apples’ devices.
How can we Employed Sales Representatives: Emphasizing the training and
relate the quota plan and goals with the rewards program with the incentives of increase commision on
incentives? the selling of the apple’s devices.
Figure 9.4
9.8
Analysis of Apple’s Sales
Representatives Department
• Apple has created a business environment that is not usual:
– Plenty open space for career growth
• Channel Sales
• Enterprise Sales
• Education Sales
• Telesales
• Systems Engineering
• Online Store
• Education Marketing
– Open minds for innovation
– Sales representatives have the luxury of selling products that
practically sell themselves
9.9
Analysis of Apple’s Human
Resource Department
• Responsible for recruiting and developing the best and
brightest employees in every division
• Supporting them throughout their careers with intensive
training programs.
• Keeps their team members happy so that they can keep Apple
one step ahead of the competition.
• Important Note:
– Apple would be nothing without its wonderfully dedicated,
diverse, and talented staff.
9.10
Remuneration and Incentive Plan
Components Objectives in the Remuneration Plan
Sales Contest Rewards for achivements in sales
expecation.
Payment Incentives Store discount on apples’ products
Salary & Commissions according to the experience and overall
performance the commission per
product sold would be determined.
Benefits Health Insurance, Dental Plan, Social
Security Plan, discounts for vacation,
participation in apples’ events and
seminars.
Chart 9.6
9.9
Collective Action in the
Administration of Sales Force
Action Proposed Idea for Apple
Third party companies specialized in the human resource
Increase interaction in
sector to give seminars in improving the sales
the training campus
envirnoment and business atmosphere.
In international expansion, permit third party recruiting
Non-competing for international representatives in Apple’s retail stores
companies share the that are abroad. This permits to ease the cultural barrier
enforcement of training and to increase the chances of success in the market and
reducing risks.
Chart 9.9
Chapter 10
Decisions of Prices
Source:
http://embracingyourlife.wordpress.com/
10.1
Apple’s Price Objective
• Maximization of sales growth with its high market
participation
• Focus on quality for profit maximization
1st Trimester
of 2011 Sales(appliances/smartphones) Billing
Apple $18,6 millions USD $ 11,9 billions USD
Nokia $108,5 millions USD $ 9,4 billions USD
Source:
http://www.zippycart.com/ecommerce-news/2221-ecommerce-growth-
strong-projected-to-hit-279-billion-by-2015.html/graph-going-up
10.2
Establishing Price Objectives
• Maximizing Sales Growth:
– This market segment is not price sensitive
– Consumer demands, high quality standard product
– Apple satisfies the demand with innovative designing and best
of all features that “drops the consumers’ mouth”
– Apple’s strategy, increases the sales volume by and are price
leader with their innovation
• This sets them as high market participation, and enormous
profits in the long term
Establishing Price Objectives
• Maximizing Profits:
– Take into account the market demand and products costs
• The market is not as price sensitive
• The market is a developed market for the company; were, the
products sell themselves
• Apple has the opportunity to maximize their profits by being price
leaders
10.3
Factors of Price’s Sensibility
Does Apple Ideas
Factors to reduce the price sensitivity apply it?
The product is unique: unique value Yes
Buyers are less aware of the existence of
substitutes Yes
Buyers can not compare
the quality of substitutes Yes
Continue
The expense in relation to total income is working
small Yes in Apple’s
way: be
The final benefit of the product is great Yes
innovative
The product cost is shared with third parties Yes and
different.
The product is used in conjunction with
assets previously bought Yes
The product has more quality, prestige and
exclusivity: Price & Quality Yes
Buyers can not store the product N.A.
Chart 10.1
10.4
Impacts in the Demand’s Elasticity
Factors Ideas and actions for Apple
Apple’s products should be shown as unique and incomparable
Substitutes or
based on the innovation, quality and differentiation. Apple’s
competitors
products are pioneers in the technological market.
The high price of Apple’s product should be explain with a focus
Perception of
on the concept that Apple is the best brand for those kind of
higher price
products
Customers will need to be satisfied and always surprise by new
Change in
products of Apple. The company must give them great variety of
purchasing habits
size, colors, memory capacity and applications
Justification of All increases on price must be explain as an advanced level on
the price increase quality and functions of the products
Chart 10.2
10.5
Price Decision According to
Competitors
Perceived value of the Intensity of Competition
product
Low High
Monopoly or differentiated Monopolistic
High
Oligopoly Competition
Pure or perfect
Low Undifferentiated oligopoly
competition
Chart 10.3
Thanks to Apples’ innovation, it became a differentiated oligopoly, where some
competitors are placed and were the decision of one company of the sector influenced the
decisions of the others. Apple is the leader and it has a great perceived value of the
products
10.6
Methods for Price Determination
The most accurate methods that could be used by Apple are:
Methods Advantages Disadvantages
It allow the easily changes on price,
according to costs. This is very important to
Frequently variations of
Markup company because the staff have great
price realized by customers
knowledge of products cost.
In special seasons the prices go up.
Apple could assure the return they want. It ignores the price
Price of the target
They could determine the break-even point elasticity and the
return
of the business. competitors price
Customers perceptions are relevant to
Price of Difficulties to estimate the
determine price.
perceived value real perceived value
Large profit margins.
Chart 10.4
10.7
Strategy to Adapt the Price
Strategy How Apple applies it
Differential Price Each product has its price depending on the
function ability, features which creates a
brand perspective.
Discounts Being price leader with high quality standard
product, and consumers being not price
sensitive. There are no discounts, and there is
no need since there is a high inventory turn
over.
Geographical Price Apples’ price is standard worldwide since
their products are segmented to middle and
high class being not sensitive to the price.
Promotional Price This is set seasonal to incentive sales growth
and usually with a bundle. For instance, a
purchase of a MacBook and granted a iPod
shuffle.
Chart 10.5
10.8
Apple’s Performance with its Price
Strategy in the market
Source:
http://www.macrumors.com/2011/06/08/apple-tops-list-of-largest-
semiconductor-buyers-in-2010/
10.9
Initiatives and
Responses to Changes in Prices
Initiative to reduce price
• Apple is price leader in the market
• However, there are many competitors in the generic
sector and there is economic recession
Strategy
• Sacrifice a small margin of sales profit
• Reduce a small fraction of cost production by taking
advantage of globalization
Response from the Consumer
• Will appreciate the reduction and increase their
purchases Source:
http://www.macquirelatory.com/Freemasonry%20Truth.htm
10.10
Perspectives of Network
and Collective Action in Prices
Actions Ideas for Apple
Increase the value perceived by the • Continue the innovating designs and
customer efficient applications.
• Increase the bundle package of
products and services.
o Offer Buy one get one free
o Buy extended warranty and
receive one year more
Reduced the Price Sensibility • Fidelity Program
• International Warranty
• Personalized Technical Support
• One of a kind Product
o Difficult to substitute
Reduction of Cost • Expand the production overseas
Chart 10.6
Chapter 11
Budget and Investment Analysis
Source:
http://edvaldocorreablog.blogspot.com/2010/09/orcamento-de-obras-sem-
segredos-simples.html
11.1
Features of the Budget
1. Long-term Goal
• Sales forecast
2.Plan of long-term results • Budget in communication
3. Short-term plan detailed
•Feasibility studies for
according to different levels implementation of new channels,
relevant liability products and product line extension
4. System of periodic reports
• Planning and production control
performance for various
levels of responsibility
Source:
Tung, 1994
11.2 Marketing Budget and
Sales Forecast
Sales
Ipod – 9.1 million U.S. $ 24 billion
End of June / 2011
Ipad 2 – 5 million
Mac – 3,89 million
Source:
http://oglobo.globo.com/tecnologia/mat/2011/04/15/demanda-pelo-
iphone-eleva-previsao-de-vendas-da-apple-diz-analista-924247487.asp
11.3 Prevision Budget of
Marketing and Sales
2011 2012 2013 2014
Sales Average $ 12.500.000.000 $ 12.500.000.000 $ 12.500.000.000 $ 12.500.000.000
Prevision Sales
Mac Book $ 2.400.000.000 $ 3.120.000.000 $ 3.744.000.000 $ 4.680.000.000
Imac $ 5.000.000.000 $ 6.500.000.000 $ 7.800.000.000 $ 9.750.000.000
Mac mini $ 75.000.000 $ 97.500.000 $ 117.000.000 $ 146.250.000
Mac Pro $ 50.000.000 $ 65.000.000 $ 78.000.000 $ 97.500.000
Mac OS X $ 40.000.000 $ 52.000.000 $ 62.400.000 $ 78.000.000
Ipod shuffle $ 90.000.000 $ 117.000.000 $ 140.400.000 $ 175.500.000
Ipod Nano $ 350.000.000 $ 455.000.000 $ 546.000.000 $ 682.500.000
Ipod Classic $ 240.000.000 $ 312.000.000 $ 374.400.000 $ 468.000.000
Ipod Touch $ 200.000.000 $ 260.000.000 $ 312.000.000 $ 390.000.000
Apple TV $ 100.000.000 $ 130.000.000 $ 156.000.000 $ 195.000.000
Iphone $ 2.475.000.000 $ 3.217.500.000 $ 3.861.000.000 $ 4.826.250.000
Ipad $ 2.100.000.000 $ 2.730.000.000 $ 3.276.000.000 $ 4.095.000.000
Total Prevision $ 13.120.000.000 $ 17.056.000.000 $ 20.467.200.000 $ 25.584.000.000
Incremental Sales $ 620.000.000 $ 4.556.000.000 $ 7.967.200.000 $ 13.084.000.000
Incremental Profit
(24% of sales) $ 148.800.000 $ 1.093.440.000 $ 1.912.128.000 $ 3.140.160.000
Table 11.1
11.3.1 Budget of Strategic Planning of
Marketing Managment
Product Plan
Enviromental Packages $ 1.312.000,00 $ 1.000.000,00 $ 500.000,00 $ 600.000,00
Launch of New Products $ 100.000.000,00 $ 100.000.000,00 $ 100.000.000,00 $ 100.000.000,00
Product Innovation $ 400.000.000,00 $ 200.000.000,00 $ 400.000.000,00 $ 200.000.000,00
Total Product Plan $ 501.312.000,00 $ 301.000.000,00 $ 500.500.000,00 $ 300.600.000,00
Communication Plan
Advertisement $ 800.000.000,00
$ 1.040.000.000,00 $ 1.248.000.000,00 $ 1.560.000.000,00
Sales Promotion $ 400.000.000,00
$ 520.000.000,00 $ 624.000.000,00 $ 780.000.000,00
Public Relations $ 401.500.000,00
$ 521.950.000,00 $ 626.340.000,00 $ 782.925.000,00
Personal Sales $ 400.000.000,00
$ 520.000.000,00 $ 624.000.000,00 $ 780.000.000,00
Direct Marketing $ 100.000.000,00
$ 130.000.000,00 $ 156.000.000,00 $ 195.000.000,00
Total Communication Plan $ 2.101.500.000,00 $ 2.731.950.000,00 $ 3.278.340.000,00 $ 4.097.925.000,00
Table 11.1
11.3.1 Budget of Strategic Planning of
Marketing Management
Distribution Plan
Investment in Global
Network $ 30.000.000,00 $ 39.000.000,00 $ 46.800.000,00 $ 58.500.000,00
Just in Time System $ 400.000.000,00 $ 520.000.000,00 $ 624.000.000,00 $ 780.000.000,00
Expansion of Apple Stores $ 50.000.000,00 $ 65.000.000,00 $ 78.000.000,00 $ 97.500.000,00
Return Plan with Distributors
(1% of Total Previsions) $ 131.200.000,00 $ 170.560.000,00 $ 204.672.000,00 $ 255.840.000,00
Total Distribution Plan $ 611.200.000,00 $ 794.560.000,00 $ 953.472.000,00 $ 1.191.840.000,00
Sales Force Plan
Incentives to Sales (1% of
Total Provisions) $ 131.200.000,00 $ 131.200.000,00 $ 131.200.000,00 $ 131.200.000,00
Trainig $ 50.000.000,00 $ 50.000.000,00 $ 50.000.000,00 $ 50.000.000,00
Total Sales Force Plan $ 181.200.000,00 $ 181.200.000,00 $ 181.200.000,00 $ 181.200.000,00
Total Budget PGEM $ 3.395.212.000,00 $ 4.008.710.000,00 $ 4.913.512.000,00 $ 5.771.565.000,00
Table 11.1
11.4
Justification of Budget
•The budget reflects the expected growth of
Apple, according to the sales expectancy that
the company has invested during the previous
periods.
•The results are always compared with the net
income.
11.5 NPV – Net Present Value
Cash Flow 2010 2011 2012 2013 2014
(in $USD)
0 6.000.000.000 7.800.000.000 10.140.000.000 13.689.000.000
NPV = USD$21.019.936.877
Requiered performance = 24% per year
Figure 11.1
11.6
IRR – Internal Return Rate
Cash flow 2010 2011 2012 2013 2014
(in $USD)
-10.000.000.000 6.000.000.000 7.800.000.000 10.140.000.000 13.689. 000.000
NPV = USD$21.019.936.877
IRR = 69,46%
Figure 11.2
Chapter 12
Control and Management of Strategic
Planning of Market Management
Source:
http://www.sprucebugs.com/BusinessPlanning.htm
12.1
Important Issues for
Implementation of Strategies
Element
Distribute
Planning and
rewards
Specific Task
and • Evaluate every trimester, the sales agent
incentives that are strongly linked performance
Management of Marketing
to the objectives and strategy Invite all employers for a business evaluation
meeting to incentive all employees to be
aware of the companies progression.
Top employees and sales agent s’ be given a
bonus.
Keep exercising their strategic • Main the intensity level of investment in research &
leadership development
First, resulting in more innovation in product
line for remodeling their products every year.
This leads for Apple continue being leaders in
their competition.
Chart 12.1
12.2
The Transformation Plan in
Project Management
Project
A Create new line of products (Interactive Television)
B Brand Expansion (computer and electronic accesories)
C Improve Packaging (Ecological raw materials)
D Expand Apple Retail Stores in US and Worldwide Market
E Creating and expanding a network of franchises
F Investment in social responsability
G Reduction in production cost
H Joint Action with other companies
Figure 12.1
12.2.1
Tools for Project Prioritization
Urgency (Need for Importance (The
Project/Actions speedy Impact Result of AxB
implementation) Apple)
A 4 8 32 points
B 6 6 36 points
C 9 8 72 points
D 10 10 100 points
E 8 10 80 points
F 7 8 56 points
G 8 9 72 points
H 6 9 54 points
Chart 12.2
12.2.2
Fundamental Topics in
Project Management
Details of the Developed Plan
Coordinator and The regional manager must continue the effective management control for each region
Team assuring that the strategies are being complied.
• Maintain the high quality standard of brand recognition of their products
Objectives • Expand the scope and range of products and target markets
• Reduce costs through partnerships with other companies and expansion worldwide
• Testing the acceptance of new products
• Check the performance of new packaging
Scope • Check the performance of its own stores and franchised stores
• Check the return on investments in communications
Result Improve market share participation.
Expected
It is already implemented and must continue the progression
Cronogram
Market Share: increase a 15% participation in 2012
Control Points Quality: Maintain the high quality standards
Cost: reduce the production cost in packaging at least 7% by 2013
Costs: R & D, packaging, logistics, training, expanding own stores, advertisement, direct
Budgets market
Must be perspective with the economic situation and take advantage of the production
Contingency Plan cost in the developing countries.
Chart 12.3
12.2.3
Timeline of Strategic Projects
Activity 2011 2012 2013 2014
A x x
B x x x x
C x x x x
D x x x x
E x x x x
F x x x x
G x x
H x x
I x x
Figure 12.2
12.2.4
Inter-relationship between
Projects
Activity A B C D E F G H
A 0 x x x
B x 0 x x x x
C x x 0 x x x
D 0 x
E x 0 x
F x x 0
G x x 0
H x x x x 0
Chart 12.4
12.2.5
Control Project Management
Project Responsible Period (years)
A Director of R&D 2
B Director of R&D 2
C Director of R&D 2
D Regional Director, CEO 4
E Regional Director, CEO 4
F Regional Director, CEO 4
G Director of Production, 4
CEO
H Regional Director, CEO 4
Chart 12.5
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http://www.apple.com/pr/library/2010/01/25results.html.
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ol=US%3aAAPL&stmtView=Ann.
• Consilvio, Steve. "Monograph on the Apple Business Model." The Apple Loop. 2003. Web. 10 April
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