Demographic Profile Of Iphone Customers

Published Date: 02 Nov 2017

Now-a-days â€˜customer is a kingâ€™ so it is essential need to study and analysis the customer demands. In this world of competition, to lead the world market must study market position, needs of customer, budget of customer, product cycle, etc that affects the product and company time to time. This report has been designed to provide Apple iPhone 5 with a proper strategic plan for their Indian Operations within the smart phone industry.

Apple iPhone is leading smart phone and is a globally recognized brand but now it is facing increasing competition from Samsung Galaxy products. Now Samsung Galaxy S3 has 1st position in Indian smart phone market. So to lead again the Indian smart phone market, Apple iPhone 5 will require implementing a best marketing strategy in order to make the company more locally responsive. A structureâ€™s possible change has been suggested to aid the strategy implementation after a perfect marketing strategic plan.

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Fig1: Apple Logo

1.1 Objectives

In this report, there are four main sections will used enable us to recommend a strategic direction to Apple iPhone 5, these are:

To establish background information on Apple iPhone 5 current strategic position

To investigate, analyses and evaluate the internal and external environment of Apple iPhone 5.

To generate perfect strategic options that Apple iPhone 5 could adopt and derived directly from the external and internal analysis.

To choose best option we recommend to Apple iPhone 5 and detail the implementation implications of that option.

We use basic design school model of strategy formulation ("Example of Strategic Plan Model â€“ Amazon Internal Analysis," n.d.) To develop our strategy as illustrated below,

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Fig2: Basic design school model of strategy information

Introduction & purpose

In this report I will study, analysis and evaluate the marketing concepts, marketing environment, business environment evaluation, marketing plan, blue ocean strategy, operational plan, man power and different stakeholders on marketing decisions for Apple iPhone 5 to regain number one position of it in Indian smartphone industry.

Digital World leading American Multinational Corporation that designs develops and sells consumer hardware electronics and computer software products; named Apple Inc. with its estimate vales US$ 414 billion as of January 2013 (katherine, 2013). Iphone, ipad, ipod and macintosh computers are Appleâ€™s best-known hardware products. The OS X and iOS operating systems, the Safari web browser, the iTunes media browser, and the iWork and iLife creativity and production suites are Apple software. Apple inc. is the most admired company in world from last 4 years (2008-2012) after in the United States in 2008. It has 390+ retail shops in 9 countries and an online store from where its hardware and software products sold worldwide (Jordan, 2012). The company having more than 75,000 employees worldwide was incorporated in January 3, 1977 headquartered in Cupertino, California (Santiago, Ryan, Ed, & Jiahd, 2009).

Apple Inc operates in aggressive competition in all products and services. The top competitors are Samsung (Galaxy S3), and Nokia. Apple had rewarded 1st place but now it vary between top 2 places, mainly due to its positive brand reputation, latest technology and the ability to pinpoint needs of consumers. The iPhone 5 invites consumers to a "latest digital lifestyle". Because iPhone 5 interface included digital services according needs and interests of user. The iPhone 5 giving to customers a new experience and digital life compared with other products.

1.1.2 Overview

Type

Public

Industry

Computer hardware/software

consumer electronic

digital distribution

Founded

1 April, 1976

Incorporated

3 Janruary, 1977

Founders

ï‚· Steve Jobs

ï‚· Steve Wozniak

ï‚· Ronald Wayne

Headquarter

Apple Campus, 1 Infinite Loop, Cupertino, California, U.S.

No. of locations

394 (November, 2012)

Area served

Worldwide

Key people

Arthur D. Levinson (Chairman)

Tim Cook (CEO)

Products

Mac computers, iPhone, iPad, iPod, iTune and many other software products and services

Revenue

US$ 156.508Â billion (2012)

Operating income

US$ 55.241Â billion (2012)

Net income

US$ 41.733Â billion (2012)

Total assests

US$ 176.064Â billion (2012)

Employees

72,800 (2012)

Website

Apple.com

Logo

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Table1: Overview of Apple Inc. (Apple Inc., 2012)

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Fig3: Specifications of iPhone 5, compared with other smartphones ("Is the iPhone 5 Worthy of the Number 5?," 2012)

1.2 Stakeholder Analysis

A person, group, organization, system or member who affects and can be affected by a firmâ€™s actions may refer to Stakeholder e.g. Apple iPhone 5

Fig4: Various Stakeholders

1.2.1 Customers

The iPhone 5 has a diverse range of customers including government and corporate customers, individual and public bodies. 2 million people pre-ordered the iPhone 5. The iPhone 5 has 83 million retail visitors from April to June 2012 (arora, 2012). The iPhone 5 set new record, apple sold 5 million iPhone 5s in first 3 days (dominic, 2012, p. 5).

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Fig5: Demographic Profile of iPhone customers (Singh, 2012)

1.2.2 Employees

There are 72,800 full time permanent employees and 2,900 full time temporary employees and 3,300 contractors in Apple Inc. Apple have 42,400 employees in retail division (Jordan, 2012).

1.2.3 Suppliers

Apple has launches iPhone 5 in 390 retail stores in the end of fiscal 2012, and expects 30-35 new stores in 2013. Apple Inc. has more than 2000 suppliers and an online retail store worldwide to launch iPhone 5.

1.2.4 Shareholders

There are 15,489,000 volume of its shares with estimate value of $ 459.99 per share (date as of 2/19/2013 12:31 pm ET) in Apple Inc. Apple announces $ 2.65 per share in January 2013 after iPhone launches in around 100 countries and release this on 14th February,2013 after hitting record selling figures ("investor news," n.d.).

Fig5: Apple Current Stock Value

1.2.5 Government

Apple iPhone 5 has worldwide customers so complying with laws and regulations of all countries and paying taxes. They follow the local government and public bodiesâ€™ rules to solve public issues. The smart phoneâ€™s regulation in India governed by ministry of corporate affairs, the ministry of health, ministry of shipping and income tax department of India.

1.2.6 NPO/NGO

Apple iPhone 5 collaborates with NPOs and NGOs on some areas such as human rights, environment, and social contribution so can take positive step with them.

1.2.7 Local Communities

Apple operates in 107 countries along with respecting different culture and customs of people in different regions. The iPhone 5 launches in around 100 countries up to 21st December, 2012.

1.2.8 Global Environment

Apple has an executive team for setting and implements environment policies. Apple well-known about the vast majority of greenhouse gas emissions (up to 98 %) come from the product life cycle. So iPhone 5 design and manufacture after considering these factors ("Apple and the environment," n.d.).

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Fig6: Recycle circle

2.0 Business Environment Evaluation

Business Environment Evaluation is a mixture of internal, external and customer analysis of the business organization e.g. Apple Inc, which is critical consulting process to indentify the current issues ("Business Environment Evaluation," n.d.).

Â

Fig7: Description of Business Environment Evaluation

2.1 Country (India) Statistics

India is the largest democracy in the world with more than 1.2 billion population. India is now worldâ€™s fourth-largest economic country in purchasing power parity terms. As decrease the investment, the slowdown in GDP growth is likely to continue. Poverty has been on the decline. According to official Indian governmentâ€™s estimates, poverty declined from 37.2% (2004-05) to 29.8% (2009-10).Â Rural poverty declined by 8 % points from 41.8% to 33.8% and urban poverty declined by 4.8 % points from 25.7% to 20.9. The government is now start Â investing in a set of initiatives to bring basic services/needs to the poor â€“ in terms of elementary education, basic health care, rural roads, and rural connectivity, health insurance ("india overview," n.d.). Â

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Fig8: Indian GDP annual growth ("GDP growth (annual %)," n.d.)

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Fig9: Indian Lending Data ("india," n.d.)

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Fig10: Smartphone user in India (Tech c, 2012)

CMR in its latest report Review 2Q 2012, has shared that January-June 2012, 102.43 million units shipments done of mobile smart handsets. The total shipments of smartphones were 5.50 million units for that period in India. As per the figures, Nokia tops the Indian smart mobile handset market with a market share of 22.2 %, followed by Samsung at 13 %, and Micromax at the third position with 5.5 %.Â

Â With a 16.9 percent growth rate, Feature phones emerged as popular segment in the country as smartphones accorded for 12.2 %. Among the all players in the smartphone segment, Samsung Electronics specially Galaxy S3 smartphone emerged as a popular choice with 41.6 % shipments, followed by Nokia at 19.2 % and RIM with 12.1 %.Â

Samsung Electronics is estimated to have shipped nearby 18 million units of the Galaxy S3 in the period, as compared with the 26.9 million units of iPhone 5 shipped by Apple.

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Fig11: India Smartphone Market (data of mobiles company in terms of users, n.d.)

2.1.1 Brief description of the India

India is rich country in terms of religions, languages, and its cultures are unique and unparalleled. It has nourished the growth of its great civilization in history of the five thousand years. It is second largest populated country in the world and increasing with growth rate 1.312%.

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Fig12: India Statistics ("india," n.d.)

2.1.1.1 Demographics by income and households

Household Income

Graph1: Demographics of iPhone by income and household (Singh, 2012)

2.1.1.2 Map of north India where intent to set up my Business in India

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Fig13: Map of north India

North India is main part of India for my strategy plan for this report but this report analysis the whole Indian market for Apple iPhone 5.

2.2 PEST

To analysis of the external macro environment through which business operates and that controlling business factors, refers PEST analysis. So it is important for market strategic planning, design and implementation of Apple iPhone 5.

Fig14: PEST Description

2.2.2.1 Political

Fig15: Political analysis

2.2.2.2 ECONOMICAL

Fig16: Economical Analysis

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Fig17: Inflation rate for Smartphone in 2012 (Tech c, 2012)

2.2.2.3 Social

Fig18: Social Analysis

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Fig19: Income Distribution in India ("income distribution," n.d.)

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Fig20: Chart of Indian population growth ("population growth rate," n.d.)

2.2.2.4 Technology

Fig21: Technology Analysis

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Fig22: Energy cost of iPhone 5 compared with other electronic devices (Fischer, 2012)

2.2.3.1 The opportunities that you can leverage off

There are so many opportunities for business that can leverage off in mobile industry in Indian market. There are millions user of iPhone and other smartphones who prefer to use daily used new applications. With increasing living standard of Indian people, they use smartphone for email and net accessing even more than USA smartphone users. So iPhone 5 is fastest web access smartphone that can take advantage of it by using strong tie up with wireless communication companies to provide fastest web accessing. The iPhone 5 also have opportunities to make extras benefits from its unique apps as Indian people being addicted of phone apps now a day.

2.2.3.2 The threats that you need to be aware of

Apple iPhone is one of the top smartphone companies in the Indian market so has to aware about threats from local and foreign competitors. Its customers and suppliers can reduce margin by bargaining factor. Local customers are expat to take advantage of warranty time period to get new handset, so have to be plan for it. Change in government policies on tax and foreign companies is also a threat that need to be aware of.

2.3 Porter 5 Forces

2.3.1 Use of the Porter 5 Forces

Porter 5 force is a quite simple but most powerful tool to know where power lies in business situation that helps to take fair advantage of the situation of strength, improve the weakness and avoid taking wrong steps.

Fig23: Porter 5 forces for iPhone 5

2.3.2 The Factors that will have an impact on business

1. Threats of Substitutes

Focus making superior quality product

Pro

Reflect high performance

Reflect non price competitor

Insulated from intensive competitors

Cons

Increase cost of production

Possible for losing market share

Produce own substitute

Pro

Drive up sales and maintain market share

Compete with competition

2. Threat of new entrants

Continue using product differentiation strategy

Invent new technology products constantly

R&D should find ways to cut costs

3. Bargaining of Power of buyers

Focus on niche market

Pro

Move efficient and effective

Generate higher profits as customer satisfactions achieved

Cons

Not much sales and profit generated

Suffer a great loss when market failure

Highly compatible closed system

Pro

Maintain its cost

Minimize the risk of competitors

Rising profits

Cons

Take time come out patch

Cost satisfaction

Constantly bear research cost

4. Bargaining Power of Suppliers

Move to Intel Processor

Pro

Coming out amazing products

Lower production cost and increase sale

Cons

Fight against other competitors

Strong vertical integration

Pro

Coordinate activities in supply chain

Increase costumer exposure

Enhance product quality and enjoy unparallel pricing power

Cons

Bureaucratic cost increase

5. Competitive Rivalry

Spend heavily on R&D department

Pro

High brand recognition and reputation

Expand market share

Sustain status as industry leaders

Enhance probability

2.4 SWOT

SWOT stands for strengths, weaknesses, opportunities and threats

Is important for to know todayâ€™s and tomorrowâ€™s position of business

To find out Appleâ€™s position

2.4.1 SWOT Factors

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Fig24: SWOT Factors ("mobile marketing SWOT analysis and C2S," n.d.)

2.4.1.1 Strengths

For iPhone 5 produces its own software

The iTunes is a marvelous revenue source

Price area level of iPhone 5â€™s provide enough room to avoid price competition

The iPhone 5 is easy to use due to its high appealing design

Steeply growing market

Low-debt: easy to control finance

The iPhone 5 has good brand loyalty

Announce to launch with Intel processor

High developed R&D department

2.4.1.2 Weakness

Is negative element that could be improved

Weak relationship with market titan Microsoft

Technological iPhone 5â€™s has extremely short lifecycles

Low presence in promotion other than products placements educational areas and publishing

Less market share as compared to Microsoft i.e. competitor of Apple

2.4.1.3 Opportunities

External factors that influence current and future position of Apple Inc

Increasing online sales

With other companies, increasing bonds and partnerships

The production of own software which are increasing on iPhone 5â€™s

Most demanded and sold Apple products are iPhone

Large and increasing population results in more future potential customers

2.4.1.4 Threats

In the smartphone market Apple has very strong competition from Samsung, Nokia

Music piracy: free download instead of buying at iTunes

The long lasting economic recession, this affects Appleâ€™s sale in the future

Its product expensiveness threatens Apple being undercut by low cost imports

The very high speed of technology development

2.5 Strategic Groups

In this concept for strategic management, study and evaluate the price and customer satisfaction of entire group of companies within the mobile industry who operates in same business along with same strategy. Samsung, Apple, HTC, Micromax, Nokia, Spice, LG, Vodafone, Sony Ericson, RIM black berry and Motorola are all mobile companies in India.

2.5.1 Define and use of Strategic groups

High D:\cmba\apple iphone 5\nokia logo.jpg D:\cmba\apple iphone 5\BBerry logo.jpg D:\cmba\apple iphone 5\apple logo.jpg

Price D:\cmba\apple iphone 5\Micromax_Logo.gif D:\cmba\apple iphone 5\samsung logo.jpg

Medium D:\cmba\apple iphone 5\sony ericson logo.jpg D:\cmba\apple iphone 5\lg logo.jpg D:\cmba\apple iphone 5\htc logo.jpgD:\cmba\apple iphone 5\nokia logo.jpg

D:\cmba\apple iphone 5\spice logo.jpg D:\cmba\apple iphone 5\motorola logo.jpg D:\cmba\apple iphone 5\vodafone logo.jpg D:\cmba\apple iphone 5\Micromax_Logo.gif D:\cmba\apple iphone 5\nokia logo.jpg

Low

Low Medium High

Customer Satisfaction

Chart2: Illustrative Price Vs Customer Satisfaction using Strategic group of industry

Apple iPhone already provide full customer satisfaction with highest price range. As price, Apple has two main competitors, HTC and Blackberry but they donâ€™t provide 100% customer satisfaction. As Customer satisfaction Apple iPhone 5 is lacking behind the Samsung Galaxy S3 but Samsung Galaxy S3 is lacking in terms of price as compared to Iphone 5. But due to Apple iPhone 5â€™s high price and less supply, customers are moving to Samsung Galaxy S3. So Apple must either reduce price or improve supply.

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Fig25: Overall rating of mobile companies ("2012 U.S. Wireless Smartphone Customer Satisfaction Study and 2012 U.S. Wireless Traditional Mobile Phone Satisfaction Study," 2012)

2.6 Market Segmentation

Market segmentation refers as a marketing factor which helps the firms to identify the all portions of the market as they respond to different features and products. It is very important to perform better than competitor so market segmentation helps to understand and satisfy their customers. So for Apple iPhone 5, by segmenting a market is possible to identify particular customers with same needs, and then target them with products made accordingly their needs to fulfill said needs.

2.6.1 Wallet Size

Product

Single professionalâ€™s income (in US $)

iPhone 5 - 16 GB

US $ 649

iPhone 5 - 32 GB

US $ 749

iPhone 5 - 64 GB

US $ 849

Price

2000 +

11 million

25 million

6 million

1500 - < 2000

5 million

12 million

1 million

1000 - < 1500

6 million

11 million

2 million

500- < 1000

8 million

5 million

1 million

< 500

4 million

2 million

1 million

Table2: Illustrative Wallet size for iPhone 5 accordingly Single professional aged 25-34 yrs old

3.0 Marketing Plan

3.1 Definition of Marketing Plan

'The management process responsible for all three main steps i.e. identifying, anticipating and satisfying customer requirements profitably', is called "Marketing" states by the Chartered Institute of Marketing.

3.1.1 Marketing Mix: 4Ps

Fig26: The marketing mix-4Ps

3.1.1.1 Product

The iPhone 5 has wider screen, lower weight, thin and will have a full year warranty. It supports to 2G and 3G technology with inbuilt 16/32/64 GB memory. The iPhone 5 is best internet full screen browsing ever on a smart phone (Syed, 2009).

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Fig27: iPhone 5

3.1.1.2 Price

Company uses many different methods and policies to fix amount of products and service given by the corporation, called Price depend on finite quantity, weight or any other parameter of a good or service. The iPhone 5 with 16 GB of storage is worth of US $ 649.99, with 32 GB storage is of US $ 749.99 and US $ 849.99 for a 64GB (aresyeah, 2012). Its feature makes it higher selling product and it is $ 100 costly from Samsung S3 only due to its price sensitivity i.e. high share value share revenue.

Company

Apple

Samsung

HTC

Black Berry

Model

iPhone 5

S 3

HTC EVO 4 LTE

Z 10

Price

US $ 649

US $ 549

US $ 729

US $ 743

Table3: Comparison price between iPhone, Samsung, HTC and Blackberry

3.1.1.3 Promotion

A great product does not guarantee for its best sale, customers should be aware about product, its specifications, and its benefits. For this promotion is used. The important factors are:

Fig28: Promotion strategy

The promotion, which is least involved in iPhone 5 marketing strategy, is the price reduction of $500 if sign the contract with wireless service provider like AT&T.

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Fig29: Promotion of iPhone 5

3.1.1.4 Place

Place, where customers can get products and services provided by company. The iPhone 5 uses two places of distribution, one is order online and other is long wait outside the Apple retail store. The first place gives the vast majority of people to get the iPhone 5 from their home without walking out of their doors.

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Fig30: Apple retail shop

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Fig31: Online Apple store

3.2 Expected Impact

3.2.1 Price Sensitivity of iPhone 5

3.3 Impact of Product

3.3.1 VRIN analysis

Display size

Memory

Resolution

Weight

Apps

Operating System

Camera

32 GB

64 GB

Valuable