Apple products are premium products, products that maintain a high price in order to encourage a favorable perception among premium buyers, often higher class members of society. Apple avoids competing with competitors; alternatively they set the price of products higher than their competitors. Apple maintains high priced products by only offering retailers a marginal discount. This small percentage in savings isn’t enough of a profit margin for retailers to offer big discounts on Apple’s products, which means customers end up paying a price close to the manufacturer suggested retail price. However, a retailer could give up this small profit margin and offer products at a discount to attract more customers. Apple prevents this scenario by offering monetary incentives to retailers. This price strategy prevents competition with Apple and ensures no resellers have the advantage over the.1
Place & Distribution
Currently, Apple has 490 stores in 20 countries; positions remain strong in the United States but weak in Asian countries. Apple sells its products directly to consumers through retail and direct sale through their outlet stores. The corporation also includes telecom companies like AT&T, Verizon, and Sprint, which sell iPhone units. In addition, Apple uses fulfillment services from companies like Amazon.com and eBay, through which third parties sell Apple products online. They also collaborate with trade partners to maintain their network of distribution. “They have firm believed that keeping lesser number of trade partners can increase the efficiency of distribution channel. These products are then sent to authorize retailers for apple products.” There are two types of resellers Apple uses, an authorized seller and an Apple premium reseller. Apple authorized sellers sell products from multiple brands, for example, retail stores. Apple premium resellers sell products only from Apple. In addition to retail outlets, Apple uses online channels to distribute their products.
Apple advertises its products online medias such as its own website , magazines, television commercials , newspaper , and media events. In their retail stores they display their products to provide consumers with the opportunity to determine what features they prefer or not. Apple focuses on how different it is from the competitors; hence they rarely offer discounts or sales except to students. The company also uses personal selling in the form of Apple Store employees who provide product-specific information in the aim of convincing store visitors to make a purchase. In addition, the company’s marketing mix involves sales promotion, which usually happens at the Apple Stores. For example, some Apple Stores offer old models at discounted prices when bundled with larger and more expensive products. Moreover, the company uses public relations to optimize its corporate image. For instance, Apple Events, leaks of new product features, press releases, and exclusive interviews are carefully implemented to maximize positive publicity.
Apple’s positioning statement “Think Different” inspires innovation, imagination, aspirations and emphasizes the purpose of Apple’s technology. The focal point of Apple’s branding strategy is emotion. By establishing a connection with its customers, Apple is able to meet the needs of its customer, thus creating a culture and set of activities to differ from its competitors.
SOCIAL RESPONSIBILITY & ETHICS
Apple’s Code of Conduct reflects their commitment to safe working conditions, fair treatment of employees and environmentally friendly manufacturing. The corporation takes responsibility to stop unethical practices among suppliers. According to their recent Supplier Responsibility Report, Apple has increased the number of workers trained on their rights by 11.7 million since 2008 and they’ve also invested in educating their employees.
“A more educated workforce is a more empowered workforce. In 2016, we partnered with our suppliers to train more than 2.4 million workers on their rights as employees. We’re also helping build stronger futures by offering the people who work in our supply chain a wide variety of educational and training programs. These include the opportunity to earn a bachelor’s or associate’s degree, attend vocational training, and take classes in language, arts, finance, and basic life skills.”
Apple exuberates pride in developing environmentally safe technology and holds their partners and suppliers to the same standard. Apple is helping their suppliers reduce the amount of energy they use and switch to renewable energy. In 2016, they tripled the number of supplier sites partaking in their energy efficient program which has led to the reduction of more than 150,000 metric carbon emissions. More than 99 percent of paper used in Apple’s packaging is from recycled wood fiber or sustainably managed forests. 2
Under Tim Cook’s leadership, Apple is more socially responsible and less visionary. Cook’s focus on Apple’s hardware and design remains the same; in contrary he’s stressed Apple’s social efforts. He’s highlighted the importance of social efforts such as LGBT rights, philanthropy, corporate diversity, renewable energy and improving manufacturing conditions abroad. Teams are encouraged to be more aware of Apple’s supply chain and any signs of misconduct on trips abroad. “Another employee said there was definitely a “louder environmental voice” inside the company pushing it to be greener.”(CNN, Seth Fieger man)3 Cook is one of the many business leaders in the US who appear to be filling the void, using his platform at Apple to wade into larger social issues that typically fell beyond the mandate of executives in past generations.
“We have a moral responsibility to help grow the economy, to help grow jobs, to contribute to this country and to contribute to the other countries that we do business in.”
2 Source: https://www.apple.com/supplier-responsibility/
3 Source: http://money.cnn.com/2016/08/24/technology/apple-tim-cook-five-years/index.html