Introducing: Apple Inc.

The founding of Apple.

The history of our chosen company is a tech fairy tale of one garage,
three friends and very humble beginnings. Apple like all new companies was a
start-up, but what makes Apple so unique was that it never changed its structure.
Up until today is the biggest start-up company in the world.
In the beginning there were two Steves, - Jobs and Wozniak – they may
have been Apple's most visible founders, but were it not for their friend Ronald
Wayne there might be no IPhone, IPad, and IMac today. Jobs convinced him to
take 10% of the company stock and act as an arbiter should he and Wozniak
come to blows, but Wayne backed out twelve days later, selling for just $500 a
holding that would have been worth $72bn 40 years later.

How Apple got its name.

According to the biography of Steve Jobs, the name was conceived by

Jobs after he returned from apple farm. He apparently thought the name
sounded “fun, spirited and not intimidating.”
The name also likely benefited by beginning with an A, which meant it
would be nearer the front of any listings (Macworld, 2017).

Apple’s mission and vision.

Apple’s current mission statement is: “Apple designs Macs, the best
personal computers in the world, along with OS X, iLife, iWork and
professional software. Apple leads the digital music revolution with its iPods
and iTunes online store. Apple has reinvented the mobile phone with its
revolutionary iPhone and App store and is defining the future of mobile media
and computing devices with iPad.”
Apple’s current vision statement is: We believe that we are on the face of
the earth to make great products and that’s not changing. We are constantly
focusing on innovating. We believe in the simple not the complex. We believe
that we need to own and control the primary technologies behind the products
that we make, and participate only in markets where we can make a significant
contribution. We believe in deep collaboration and cross-pollination of our
groups, which allow us to innovate in a way that others cannot (Apple, 2016).

(Apple, 2017)

Current trends
Apple is operating on a largely heterogenic consumer technology market
selling a range of both hardware and software products and is therefore affected
by trends from different, yet largely interdependent groups of products. Most
notably, by the mobile devices industry. Driven by a tense competition
strengthened by a fact that smartphone market is reaching it saturation point,
mobile devices market trends are changing on a yearly basis.
The gadgets became more powerful, smaller and stuffed with sensors and
broadband antennas. Yet most recently, technological advancements started to
shift away from focusing on increasing raw processing power and camera image
quality to coming up with a smart ways to facilitate the creation of new ways
for consumers to interact with their devices (Gibbs, 2017). Some of the more
prominent ones are increasing penetration of augmented reality support and AI-
optimized hardware. The latter of two is expected to be used to create
increasingly more personalized services using machine learning to create unique
and seamless user experiences either in the form of AI-powered virtual
assistants or services adapting to specific users’ behavioral patterns. Other
prominent trend is the rising popularity of wearable devices, which are seen as a
way to sell more products on a market that is close to its saturation point
(Scroxton, 2015) with apple pioneering the market with its smart watches. Some
other trends Include bezel less displays, dual cameras and lack of headphone
jack, yet they are more of a fashion changes more likely to affect “physical
evidence” part of products rather than the content of services which can be
accessed with them.

Competitors and major players in the industry:

Samsung Electronics Co., Google Inc., Microsoft Corporation, Ltd.,
Amazon.com, Inc., International Business Machines Corporation, Cisco
Systems, Inc., Dell Inc., LG Electronics, Lenovo Group Limited, Hewlett-
Packard Company, Sony Corporation and many other computer hardware,
computer software, consumer electronics and Internet companies.
 Operating systems: Nearly every PC, except Apple’s Mac computers, is
sold with preinstalled Microsoft Windows OS. Microsoft develops,
manufactures, licenses, supports and sells computer software, consumer
electronics, personal computers and laptops. Nearly 90% of computer run
Windows OS and only about 6% PCs use macOS, revealing that Apple’s major
competitor in PC OS market is Windows.
The same goes with mobile OS market. Android is being installed in
every smartphone, except Apple’s iPhones and some models of Nokia’s and
BlackBerry’s smartphones. Android controls over 80% of the mobile OS market
and seriously threatens to erode the major Apple’s advantage – Apple’s
proprietary iOS and its ecosystem.
Technology: Apple’s services accounted for over US$24 billion in
revenue in 2016. Apple is being rivaled by huge corporations such as Google,
Microsoft and Amazon.com as well as smaller, but no less competitive
companies.
The main competitor is Google which provides online advertising
technologies, search engine, cloud computing and software development
services.
Mobile Payments: Android Pay and Samsung Pay are the main Apple
Pay competitors in the mobile payment market. Apple Pay enjoys wider
adoption of its mobile payment system, than its rivals and has some advantages,
such as huge database of credit/debit card information.
Other competitors are Capital One Financial Corporation with Capital
One Wallet and PayPal Inc. with PayPal.
Mobile phones: Apple’s main competitor in the smartphone category is
Samsung with its Galaxy S smartphones. Samsung is very popular with their
mobile phones among consumers. brand Samsung has a significant share of the
Smartphone market.
Other direct Apple rivals are Huawei, Xiaomi, Pixel and LG. The rest of
the rivals are either too small or target different consumer segments and do not
pose an immediate threat to the iPhone’s market share or its margins.
 Tablets: Even though the tablet market is declining, Apple is still an
absolute leader in it with over 20% market share. Samsung’s Galaxy Tabs are
the main direct rivals to Apple’s iPads, with over 15% market share.
Amazon.com was the only of the top 5 tablet makers, which could grow its
market share significantly, threatening Apple’s and other tablet vendors’
positions.
Personal computers and Hardware: Apple’s position in the personal
computer (PC) market isn’t as strong as in the smartphones or the tablets
markets. The company only captured 7.1% market share in the second quarter
of 2016. Every PC vendor has a few offerings that directly compete with the
premium quality Apple’s Mac PCs and usually offer better hardware or the
lower price.
The main competitors are Lenovo (21,2%), HP inc. (20,8%) and Dell
(16%).

SWOT analysis of Apple:

Strengths: Weaknesses:
______________________________ _____________________________
- Strong brand image, brand equity, - Limited distribution network.
and brand reputation. - High selling prices.
- High profit margins that come with - Sales limited to the high-end market.
price flexibility. - No significant differences between
- Effective innovation process. the normal and newer types (IPhone 6
- Easy, clear, and user-friendly – IPhone 6S).
website. - Narrow product range.
- Financially in incredible shape. - Product and Services not always
- Large and loyal customer base. compatible with other brands.
- Customer demographic. - Declining market share.
- Support (Apple care + website). - Patent infringements.
- Educational sector. - Vendor lock-in
- Marketing and advertisement.
- ICloud.
- Market leader in product quality.

Opportunities: Threats:
______________________________ ______________________________
- Distribution network expansion. - Aggressive competition.
- Rising demand for tablets and - Imitation.
smartphones. - Rising labor costs in countries where
- Creation of new product lines. Apple plants are located.
- Apple pay. - Prices of competing products.
- IOS in the car. - Online music market.
- Several Asian markets. - Reducing fragmentation.
- Product differentiation. - Loosing security.
- Exponentially increasing knowledge - Marketing guidelines.
of science in technology.
- Corporation Apple & IBM.
- AI and AR.

Strengths:

This aspect of Apple’s SWOT analysis identifies the biggest strengths that
enable the company to withstand threats in its business environment. These
threats can reduce business performance. For Apple’s, the SWOT figure are the
most notable organizational strengths (Inotes4you, 2015).
Apple is one of the most valuable and strongest brands in the world. This
part of the SWOT analysis shows that the company is capable of introducing
profitable new products by virtue of its strong brand image. In addition, Apple
maintains its premium pricing strategy, which comes with high profit margins.
This is a major strength because it creates flexibility for the firm to adjust prices
while ensuring significant profits. Also, Apple is known for rapid innovation
based on the companies’ intensive growth strategies. Rapid innovation enables
the firm to keep abreast with the latest technologies to ensure competitive
advantage. Based on this dimension of Apple’s SWOT analysis, the company’s
strengths are difficult to compete with, thereby supporting the firm’s continued
leadership in the industry (Apple, 2018).

Weaknesses:

In this aspect of Apple’s SWOT analysis, the emphasis is on the

weaknesses or inadequacies of the company. Weaknesses can serve as obstacles
to business growth. In Apple’s case, the organizational weaknesses in the
SWOT figure are most notable.
Apple has a limited distribution network because of the company’s policy
of exclusivity. For instance, the company carefully selects authorized sellers of
its products. This part of Apple’s SWOT analysis shows that such an exclusive
strategy supports control over the distribution of products, but limits the
company’s market reach. In addition, because of the premium pricing strategy,
Apple has the weakness of having most of its sales revenues from the high-end
market. This market is composed of customers from the middle and upper
classes. Customers from the lower class, which represents the majority of
buyers in the global market, are unable to purchase Apple products because of
the relatively high prices. Thus, based on this dimension of Apple’s SWOT
analysis, the company’s pricing and distribution strategies impose limitations or
weaknesses in the business (The student centre, 2016).

Opportunities:

This aspect of Apple’s SWOT analysis pinpoints the most significant

opportunities that Apple can exploit. Opportunities influence the strategic
direction of business organizations. In Apple’s case, the ones in the SWOT
figure are the most significant opportunities in its business environment.
 Apple has the opportunity to expand its distribution network. Such
opportunity directly relates to the weakness of the limited distribution network
of the company. This part of Apple’s SWOT analysis emphasizes the need for
the company to change its distribution strategy. An expanded distribution
network can help the firm reach more customers in the global market. Also,
Apple has the opportunity to explore new product lines. Its current product lines
are highly successful. Through further innovation, Apple can introduce new
product lines, like what the firm has already done with the Apple Watch.
Developing new product lines can support the company’s growth. Thus, this
dimension of Apple’s SWOT analysis indicates that the company has major
opportunities for further growth despite aggressive competition (Blogspot,
2017).

Threats:

In this aspect of Apple’s SWOT analysis, the focus is on the threats from
various sources, such as competitors. Threats can limit or reduce the financial
performance of companies. In Apple’s case, threats in the SWOT figure are the
most significant.
Tough competition in the industry is partly because of the aggressiveness
of firms. Apple competes with firms like Samsung, which also uses rapid
innovation. This part of Apple’s SWOT analysis highlights the limiting effect of
aggressive competition. Because of the aggressive behaviours of competing
firms, it is necessary to have strong fundamentals for maintaining competitive
advantage. In addition, Apple faces the threat of imitation. This threat is
significant because of the large number of firms that can easily imitate Apple’s
products. Some local and regional firms could partially imitate Apple’s product
design. Moreover, rising labour costs in Apple plants, such as in China, can
reduce profit margins or push selling prices even higher. Based on this
dimension of Apple’s SWOT analysis, the company’s performance could suffer
because of aggressive competition and imitation of product design. Thus, Apple
must take appropriate action to prevent or overcome these threats.

Recommendations Based on Apple’s SWOT Analysis:

Apple’s SWOT analysis indicates that the company possesses major

strengths that can be used to effectively address organizational weaknesses. The
company can also use these strengths to exploit the opportunity to expand its
distribution network. In addition, Apple can use its strong brand image and
rapid innovation processes to successfully develop and launch new product
lines. However, the firm faces the significant threats of aggressive competition
and imitation, which are major challenges affecting players in the industry. A
suitable course of action is to address these threats through a stronger patent
portfolio, along with continuous innovation to ensure the competitive advantage
of Apple products even when competitors try to catch up (Smithson, 2017).

Apple’s Marketing mix

Product.

Apple sells its products in a following categories:

 Computer hardware (Mac, iMac, Mac Pro, MacBook, MacBook
Air)
 Computer software (iOS, OS X, Safari, iLife, iWork, iMovie,
iPhoto)
 Consumer electronics (iPod, iPhone, iPad, Apple TV and Mac
products)
 Digital distribution (iTunes store, iCloud, App Store, Mac App
Store)
 Software and services – One of the competitive advantages of Apple lie in
its software and operating system which is the MacOS. At the same time, it
introduced various services Itunes, Ibooks, Icloud, Apple music, Iwatch and
Apple TV and others. Each of them is individually good, but together they drive
a strong revenue for Apple.
Apple as whole is a great example of product servitization. Despite the
fact that the main stream of revenue for them is sales of their hardware
technological products, the technology is not their main concern. For apple it is
significantly more important how can customers use their products and what
services can they access with them, rather than product itself or the technology
involved. Ironically, to craft superior user experiences, Apple is forced to push a
technological part forward, as in many cases the available tech is limiting factor
in designing their services. On the dawn of iTunes era, people were not buying
the IPods because they thought that it was a high-quality music player, but
rather the focus was on iTunes an enhancing software - the solution that made
listening to music more convenient than ever before.
 Apple’s core product is their technological hardware and software
solutions for day-to-day consumer needs, whether professional or not. The main
source of competitive advantage for their products is simplicity of usage. The
company surrounds their core products by all kind of enhancing and facilitating
services in order to deliver great consumer experience both prior and after
purchase.
 Enhancing services:
Apple offers advice and consultation for its customers using multiple
channels. They offer online articles on the usage of their products, personal
training and counselling in Apple stores. The genius bar and Apple care service
offers advice on product repair and replacement processes as well as consult on
the appropriate products for a specific customer’s needs.
To control customer experiences in stores, Apple bets on highly trained
employees with scripted, yet personal approach to each customers, creating
atmosphere of helpfulness and hospitality. Often Apple stores are overstaffed to
ensure that every customer gets a member of staff appointed to them.
Safekeeping attributes of Apple stores are dedicated area for kids in the
shops, and various services dedicated to caring for the purchased goods. The
products are securely packed prior to being delivered or taken home by the
customer; any customer can have personal training session with company’s
products or have their gadget set up for them. Repair and maintenance services
are offered and require almost no intervention from customer side. Another part
of this service is an upgrade program allowing customers to get the most recent
versions of Apple’s iPhones for a fixed monthly fee.
Exceptions are handled in a following manner: Apple stores are designed
to be accessible to people with disabilities, moreover, all Apple products except
the ones designed for a professional usage, are designed to have accessible
functions for people with disabilities (https://www.apple.com/accessibility/).
Other offers in this section are related to warranty and problem solving, and
include post-purchase warranty repairs and replacement services, Apple care+
plan, covering user-caused accidental damage for a small fee, and Apple Genius
bar, managing repairs, replacements, and resolving difficulties arising from
using the products.
Facilitating services:
 Information about all Apple products is available on Apple own website
as well as numerous third-party websites dedicated to company’s products.
Manuals for products are also available on-line or through the devices
themselves. Traditionally, Call-center employees as well as store employees, are
trained to supply potential customers with all the needed consultation about
company’s products.
Order-taking processes are largely dependent on the purpose pursued by
the customers. Orders are taken online, in retail locations. Service reservations
may also be made by calling support center or visiting the service locations.
Billing process have several options. Bills can be received by e-mail,
physically with ordinary mail and can be accessed online through account
detalization. Accounts also have parental control, prohibiting kids to purchase
any services without bill review from parents. In retail locations, Verbal
statements of prices are made and amounts due are also displayed on the
demonstration devices themselves.
Payments for Apple products and services can be made in several ways.
Retail locations are accepting card and cash payments, while online payments
can be made with credit or debit cards and pre-paid cards sold in supermarkets
and directly refilling the account balance on iTunes/Appstore platforms.
Alternatively, an automated payment can be set up to pay for subscription-based
services.

Place and distribution

Apple uses multichannel strategy to reach its final customers. Its

distribution structure includes:
 Apple Stores. The world’s largest IT company by revenue operates
499 retail stores in 22 countries worldwide. Apple Retail Stores are
spacious and creatively designed place where consumers can use
 products and get friendly assistance from customer service
representatives.
 Online stores. Customers can purchase Apple products from its
official website https://www.apple.com/
 Direct sales force. The multinational technology company also
uses direct sales force in certain markets to promote and sell certain
products. For example, Apple relied on direct sales support for its
advertising business, iAd in 2016.
 Third party cellular network carriers. Major cellular network
carriers such as AT&T Inc., Verizon Communications Inc,
Vodafone Group plc and others also sell Apple products and
services as part of their own packages.
 Wholesalers. Apple partners with many wholesalers to distribute
the substantial part of its products and services.
 Retailers. There are many local Authorised Retailers such as
Carphone Warehouse and Argos in London and Mobile Guru and
T-Mobile in New York.
 Value-added resellers. These refer to professionals authorized by
Apple to deliver customized, market-specific solutions to
customers.

The most distinct of channels are company-owned retail locations and

their official web-store, both sharing modern and clear design and focusing on
service-first paradigm.
To date there is still a number of major consumer electronics retailers
across the world who are not authorized as official Apple resellers, by design
their distribution process is selective and that can be a limiting factor, especially
on the developing markets.
Pricing strategies:

According to Bloomberg’s news, Apple became the first U.S. company

with a market value of more $800 billion and this amount is expecting to
increase since the next iPhone is about to come. In the past years, people could
not imagine how technology companies can play a role in the centre of the
global business world, and obviously Apple’s rise as one of the top company
around the world marked the emergence of the technology.
Tim Cook, as the current CEO of Apple, stated that Apple never had an
objective to sell a low-cost phone and the primary objective of Apple is to sell a
great phone and provide a great experience. Apple’s premium quality products
(market leader) are made to work perfectly, they are not trying to compete on
price.
Apple’s skimming pricing strategy allowed the company to increase their
profit, since they were selling their products for high price (the most expensive
in the market). Although this skimming pricing strategy made apple sacrifice
their sales for these low-budget customers, the large profit helped Apple to
invest more into the new products.
The premium pricing strategy also helped Apple to build and maintain a
loyal customer group. These customers are convinced they are paying a high
price for Apple products because they receive an exceptional product with the
best quality.
 The Apple iPad is priced at a minimum of $799.
 The Apple iPhone costs begin at $599.
 The Apple Mac Book costs $1299.
 The Apple MacBook Pro is priced at $1599.
 Apple reduced the cost pricing structure for iTunes – songs will
cost 69 cents, 99 cents or $1.29. He said the “vast majority” of the
 songs would cost 69 cents. Changes are said to be a response to a
slower pace of music downloads.
 Apple care is free of charges.

To conclude, it is not easy for Apple to stick with the premium pricing
strategy since sometimes customers would choose a lower cost phone due to the
budget. However, Apple’s exception design and quality still helped Apple to be
the one and only Technology Company all over the world (Yang, 2017).

Promotion.

Apple’s marketing strategy is also just as smart as its product line. It

makes use of both conventional and unconventional techniques to promote its
product. Apple products are so sought in the market that each one of them
becomes news even before it has been released. Word of mouth marketing has
always worked in the favor of Apple and it has always generated a lot of
publicity about each product it has released.
Apple products are promoted from their website and also from other
online channels including social media. Apart from that Apple as also used
television and print media to market its products smartly. One of the distinctive
feature of the company are press conferences and events where Apple
announces or unveils new products, product redesigns and upgrades. It helps to
generate buzz over products, which gives Apple free advertising until the
products’ official release dates. A lot depends on how value is communicated to
the consumers and Apple does it smartly. Apart from that there are really
thousands of review and marketing websites which also act to promote the
Apple products.
Apple targets specific segment of people. So, during promotional
activities, its focus on its products and the differentiating factors that make its
unique from the competitors. The promotional strategy in the marketing mix of
Apple focuses on aggressive advertising using various channels. If we closely
see the ads that Apple has come up with, it has always tried to focus on how
different it is from the competitors. It has always believed that ads should be
simple and gets connected to the heart of the people.
Apple’s marketing strategy is built upon the company’s emphasis on
innovation, minimalist design of hardware and software, and more recently,
luxury and style. Apple is positioned as a premium brand that demands a high
price but provides customers with an easy-to-use, high-quality, and beautifully
designed product. The company is targeting a less price-sensitive customer that
is more concerned with owning the best product. Apple prides itself most of all
in “changing the world” by creating the most innovative, game- changing
products that were also thoughtfully designed and optimized for their intended
functions.
The company is betting on superior user experience of interaction with
their products and services, therefore, it often uses the depictions of such
interactions in their promotional activities. By demonstrating potential
customers how can they use Apple products, what services they can access and
essentially the quality of user experience from interaction with them, Apple
effectively deals with the problem of intangibility of services. Another method
Apple used to deal with intangibility of the experiences associated with their
products was “Humanizing” the product and comparing it to the humanization
of competing solutions. The campaign using such method was called "Get a
Mac" and consisted from series of TV ads with two actors. One man dressed in
casual clothes introduces himself as a Mac, while other man in a more formal
suit-and-tie combination introduces himself as a Windows personal computer,
after which a short sketch comparing the properties of two products is played by
them. These ads depicted the troublesome experiences related to using
conventional PCs and opposed them to a superior trouble-free user experiences
offered by Macs. (http://www.adweek.com/creativity/apples-get-mac-complete-
campaign-130552/)

All in all, Apple promotional efforts are examples of deep understanding

of their product’s main characteristics, and capitalization on the user

experiences created by interaction with tech products.

People

Apple relies heavily on its people both on top-level managers and front-
line employees. Steve Jobs was one of the masterminds behind Apple and
demonstrated an iconic, celebrity identity. Unlike other brands who don’t have
such a visible public figure, Apple has excelled at encouraging the CEO to be in
the public eye. Steve Jobs and now Tim Cook are the frontiers for the brand and
hosts of WWDC each year (https://developer.apple.com/wwdc/).
On the front line Apple doesn't hesitate to go an extra mile to create a
wonderful experience for their customers in Apple stores. Apple hires true fans
of their products as front-end employees and trains them hard in an effort to
maintain a unique service atmosphere in company’s retail locations.
While most retailers have to seek out staff, many Apple stores are flooded
with applicants.Therefore, working for an Apple store can be a competitive
process, usually requiring at least two rounds of interviews. Applicants are
questioned about their leadership and problem solving skills, as well as their
enthusiasm for Apple products. The applicants who pass this stage undergo
training which extends down to such details as a scripts for listening to a
customer.
Candidates for Genius tech support staff undergo even more training in
facilities worldwide, then are certified and regularly tested on their skills.
Training extends even to language. For example they are told to say “as it turns
out” rather than “unfortunately” to sound less negative if they are unable to
solve a tech problem (https://ru.scribd.com/document/262752243/Secrets-From-
Apples-Genius-Bar-Full-Loyalty-No-Negativity).
As a motivational bonus, employees are receiving discounts on
company’s products and are protected by medical insurance. On the top level,
key employees are offered stock options and granted access to services such as
private jet flights.
(https://www.glassdoor.com/Benefits/Apple-US-Benefits-
EI_IE1138.0,5_IL.6,8_IN1.htm)

Physical evidence

From the “Physical Evidence” standpoint, it is most important to analyze

Apple retail locations as since they were first introduced, their model has
become an industry standard, which many tech companies try to copy, but few
actually succeed in doing so (Gallo, 2015). Apple stores are designed to increase
consumer spending and reportedly generating more revenue per square foot than
any other retailer in the world (Chance, 2017). Apple has mastered usage of
servicescape to increase consumer spending. Its stores are located in premium
high-traffic, high-visibility areas and incorporate open clean and spacious
concept. Often the design of the store exterior is something extravagant and
modern-looking, like a giant glass tower in Shanghai. A typical apple store is
laid out in three zones starting at the storefront. First zone is dedicated to
product displays, Second zone is training and personal setup area where most of
the accessories are located and last zone is Genius Bar providing tech support
and organizing repairs.
The open design of stores allows customers to flow between products,
which are all set-up to encourage interaction. Products on display are connected
to the internet, equipped with demo software and specifically aligned to look
towards the customer. Additional attention is paid to the children; they have a
dedicated area with products and accessories placed at their eye level. The
Genius Bar zone is modeled after Ritz-Carlton Concierge desk (Gmoser, 2014)
and its staff is trained to be customer oriented and focus on building
relationships and transforming customer’s problems into opportunities by
enthusiastically solving them.
Apple stores are specifically designed to make customers interact with
devices. Notebook computers are set at precisely 70 degrees
(https://gizmodo.com/5918880/why-apple-stores-tilt-the-macbook-pro-exactly-
70-degrees) to lure customers into feeling the device and ultimately get the feel
of possession. Additionally, their staff is trained to interact with the devices as
little as possible during personal training sessions with customers and instead
guide them to find their own solutions to give a sense of “ownership
experience” and create more brand loyalty with customers.
The staff in Apple stores relies on an effective communication technique
adopted from the Ritz-Carlton steps of service. Every employee is trained to
take a customer through five steps spelling out as APPLE acronym, they are:
A: Approach customers with a personalized, warm welcome
P: Probe politely to understand the customer’s needs
P: Present a solution for the customer to take home today
L: Listen for and resolve issues or concerns
E: End with a fond farewell and an invitation to return

Employees are not waiting for customer to express his/her problems,

instead they take the initiative by assuming that customers arrived at the Apple
store looking specifically for something and intercept them, though not
intrusively, ready to answer any questions and point them in the right direction
(Blackshaw, 2008). Often Apple’s retail locations are overstaffed to ensure that
each customer has a personal staff member appointed.
We may also consider Apple’s hardware products packaging to be a part
of their servicescape. It shares brand’s simple yet appealing design and
contributes to consumer experience with a sensation of unwrapping new
purchase. There is also a distinct smell accompanying all new Apple products
and known as “smell of a new Mac”, even though Apple itself does not admit
using scent marketing in its products.
The domination of Apple on tech market is further cemented in
consumers minds with the latest addition to Apple’s properties – a landmark
building looking like a giant glass donut, named Apple Park, located in
Cupertino. This giant building running entirely on renewable energy is now
open for public access. While being a hub for employees it also features a
visitor centre, Apple store and café for public use. Bridging the divide between
practical use (for employees) and a destination for visitors and hardcore Apple
fans.
In the third-party stores Apple likes resellers to sell their products as
unique categories rather than side-by-side to their competitors. They seek to
control category management so that their products share a section called
“Apple products” rather than being split between “Smartphones” “Tablet PCs”
and “Laptops” sections therefore making their products to stand out, effectively
distancing their products from competition, avoiding direct comparison with
other tech manufacturer’s products and gaining a competitive advantage in
positioning.

Process:

Apple converts new customers and secures their brand loyalty through a
corporate emphasis on customer service (Apple care). Furthermore, switching
devices or transferring files between Apple products is the easiest process ever,
whereas changing to another non-Apple product is the most difficult process
ever. This declines the product range for the consumer unknowingly, once you
go Apple you never go back to something else.
Apple seeks to attract its target market through bold Public Relations
events (such as the MacWorld Expo) as well as advertising imagery, which
borrows from contemporary modern art. These huge events get much exposure,
and in most cases promotion is happens automatically. Millions of Apple fans
worldwide will tune in to watch the newest releases, by making the events
easily accessible in both a physical and virtual environment people are eager to
tune in.
Apple has expanded its distribution channels in recent years including the
addition of all Wal Marts on a global scale. (Marketingteacher, 2017).
Apple are excellent at ensuring everything is simple  and works the way it
is supposed to, from the products easy to use interface to the hassle-free way of
getting gadgets repaired if needs be. Their website walks the customer through a
step by step guide to troubleshoot what the issue may be with their device
before offering appointments at the nearest Apple Store if needs be. At the
Apple store you are always welcomed with a smile, because when you enter the
store, you are part of the Apple family (Kelly, 2017).

Conclusions and recommendations:

Apple products are all about the customer. They are designed to support
the need of the day. Every feature is focused on making life easier for the
customer. Their after sales service takes this support to the next level. However,
to experience Apple’s “magic” the consumer has to pay a significant premium
over the average tech products prices. This approach is limiting Apple from
tapping into a significant part of market, specifically the younger audiences and
people from developing countries. Both market opportunities are worth
exploring, though through separate product lines rather than lowering prices for
current model mix.
Exclusive distribution of Apple’s product, despite having a positives of
controlling the consumer in-store experience, can be a limiting factor in Apple’s
growth, especially in a markets new to their products.
As the smartphone market is close to its saturation point, it is also
reasonable to seek a way to sell more products to current product users. One
such opportunity lies in high-tech wearables. It is an emerging trend in which
Apple has already looked into, yet their participation was limited to smart
watches. By exploring alternative wearable devices, Apple may find a way to
sell more of its products to the existing customers.
Apple’s Servicescape model is a benchmark for its competitors and is
used by company as a source of competitive advantage. However the number of
locations they own is relatively small, as many retailers have several thousands
of stores while Apple currently owns just under 500 in 20 countries. If Apple
will be to expand the number of stores it is possible for them to encounter
difficulties in maintaining such high level of service for instance, there is a
possibility of running out of truly passionate candidates for their stores.
For a company owning the most profitable (in terms of revenue per
square ft.) retail business (https://9to5mac.com/2017/07/29/apple-top-retailer-
per-square-foot/), it is important to maintain the high levels of customer service
in all of their locations. Furthermore, if the expansion of Apple stores will affect
the customer service, Apple may suffer a severe damage to its image as a
retailer. Therefore we suggest that in order to stay reigning as top-of-the-world
retailer, Apple must be thoughtful and careful in the expansion of their retail
stores, effectively limiting it and planning each and every shop carefully, taking
in account necessity of proper training and staffing.
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