A little history on Apple inc.

Steven Wozniak and Steven Jobs had been friends in high school. They had both been
interested in electronics, and both had been perceived as outsiders. They kept in touch after
graduation, and both ended up dropping out of school and getting jobs working for companies
in Silicon alley. !Woz for "ewlett#$ackard, Jobs
for %tari&
Wozniak had been dabbling in computer#design
for some time when, in '()*, he designed what
would become the %pple +. Jobs, who had an eye
for the future, insisted that he and Wozniak try to
sell the machine, and on %pril ', '()*, %pple
,omputer was born.
"obbyists did not take the %pple + very seriously,
and %pple did not begin to take off until '()),
when the %pple ++ debuted at a local computer
trade show. The first personal computer to come
in a plastic case and include color graphics, the
%pple ++ was an impressive machine. -rders for
%pple machines were multiplied by several times
after its introduction. %nd with the introduction in
early .)/ of the %pple 0isk ++, the most
ine1pensive, easy to use floppy drive ever !at the
time&, %pple sales further increased.
With the increase in sales, however, came an
increase in company size, and by '(/2, when the
%pple +++ was released, %pple had several
thousand employees, and was beginning to sell computers abroad. %pple had taken on a
number of more e1perienced mid#level managers and, more importantly, several new
investors, who opted to take seats on the board of directors. -lder, more conservative men,
the new directors made sure that %pple became a 3real company,4 much to the dismay of
many of its original employees.
+n '(/', things got a bit more difficult. % saturated market made it more difficult to sell
computers, and in 5ebruary. %pple was forced to lay off 62 employees. Wozniak was injured
in a plane crash. "e took a leave of absence and returned only briefly. Jobs became
chairman of %pple computer in 7arch.
Brand v/s corporate strategy
%pple once again delivered very strong results in the face of hesitant consumers under
recessionary pressures. Total revenue growth for the latest 8uarter was 9:*; led by the 7ac
brand in personal computers at 9<';. The 7$: segment led by the + $od brand delivered
growth of 9'; while the i$hone sold '.) mm units.
So how is %pple able to deliver consistent sales and profit growth in tough recessionary times
with premium pricing while many of its competitors deliver poor results. +n a phrase ##it=s their
superior branding strategy.
% company=s brand name is often its most valuable asset. Simply put a >?rand> is a name that
consumers associate positive or negative benefits or attributes about a particular product,
service or company. 7any people think of brands as it relates to the supermarket industry.
"owever, a brand can be more than just a product name. Strong brands can evoke images of
dependability > 7aytag>, safety >Subaru>, lu1ury > Tiffany> or in %pple=s case >cool or hip and
technologically superior>.
There are many types of ?rand names. @ou can have a corporate brand name >Aeneral 7ills>
for e1ample. 7ost Aeneral 7ills products have their own individual product brands
>,heerios>. The ?ig A logo is put on most Aeneral 7ills products to signify trust and
consumer confidence. The individual brand >,heerios is what most consumers remember. +n
%pple=s case, %pple is the corporate brand with i$od being the individual brand. Some
companies brand a service or a component of a product >+ntel inside>. -ther companies use
an >Bmbrella> brand $epperidge 5arm !owned by ,ampbell Soup#,$?& This where they use
the same brand for multiple products !cookies, bread, crackers etc.&. Bmbrella brands are
used when marketing funds are tight and the umbrella brand provides instant name
recognition to the consumer. "owever, companies must be careful not to use the umbrella
brand for all products. Craft means >cheese> to consumers. ,heese based products under
the Craft brand have done very well. "owever, when Craft 5oods has used the Craft brand on
other categories !salad dressings, barbecue sauce etc& their results have not been as strong
and effective.
%pple=s success in the last year is based on two strong strategic moves they have made over
the last several years. The first was branding and marketing support behind the launch of the
i$od. They created a segment !7$: players& using a very cool, image based television
campaign featuring big name music stars to appeal to the image crazed teenager crowd.
They provided a good product !not superior in my mind& but correctly branded it and provided
a high level of marketing support to cement their image as the only cool 7$: player. + have :
teenagers and consistently tried to get them to settle for the less e1pensive Sansa brand but
was told it was an i$od or nothing. %pple created a value added difference vs. Dtheir
competition !image& based primarily on advertising and >?randing>.
Secondly, they followed up that success by supporting their 7acintosh line of personal
computers and highlighted the ease of use vs. the ista operating system and other computer
manufacturers. Their recent 8uarterly results for 7ac=s 9<'; shows this effort has also
delivered. ,onsumers have bought into their branding efforts for 7ac=s ## they are easier and
simpler to use and also more cool than traditional personal computers from "ewlett#$ackard
!"$E& and others. +n this situation %pple, also benefitted from what=s known as the >"alo>
effect. +n advertising terms this is when when one product or brand from a company benefits
in sales from a Fnd product or ad campaign from the same company. The i$od has had a halo
effect on the 7acintosh brand by bringing in younger, more image conscious consumers. The
i$od brand has also provided some of this same >halo effect> to the i$hone. ,onsumers
clearly know that all : products are made by %pple !the corporate brand& and this translates to
consumers believing %pple=s products are more hip and technologically superior than
competitive products.
The benefits to %pple as company for this superior branding strategy are immense. +t provides
a fantastic platform for future new products. ,onsumers will constantly seek out their new
products and view them as the ne1t generation with a cool image and technological
superiority, +t will also provide them with superior pricing power over the long term. This
means that %pple will continue to lead and deliver above average sales and profit growth. %s
in consumer food products a superior brand name is worth its weight in gold.
5 levels of product v/s brand
,ustomers will choose a product based
on their perceived value of it. Satisfaction
is the degree to which the actual use of a
product matches the perceived value at
the time of the purchase. % customer is
satisfied only if the actual value is the
same or e1ceeds the perceived value.
Cotler defined five levels to a productG
,ore ?enefit # the fundamental need or
want that consumers satisfy by
consuming the product or service. Aeneric $roduct # a version of the
product containing only those attributes or characteristics absolutely
necessary for it to function. H1pected $roduct # the set of attributes
or characteristics that buyers normally e1pect and agree to when
they purchase a product. %ugmented $roduct # inclusion of
additional features, benefits, attributes or related services that serve
to differentiate the product from its competitors. $otential $roduct #
all the augmentations and transformations a product might undergo
in the future.
?ecause %pple has a really wide range of products for this e1ercise
we will select only one, so i$hone it is. Iet us now identify the <
levels of productsG
,ore benefits J i$hone just used for tele#communication
Aeneric product # i$hone with at least features of a smart phone
H1pected product J i$hone with camera, music and video playback,
small application to help perform daily tasks
%ugmented product J i$hone with :A fecility, comfortable touch screen, motion gaming, open
platform to develop softwares for i$hone and also covers all e1pected product list
$otential $roduct J %ll of the above mentioned and better strong body, break#free screen,
updated technology, cheaper, no cellular provider lock and many more. %lthough it satisfies
the < levels of a product the i$hone as a brand is still the rich boys phone and it prefers this
image unlike many others.
Positioning-competitive
7arketers manage product positioning by focusing their marketing activities on a positioning
strategy. $ricing, promotion, channels of distribution, and advertising all are geared to
ma1imize the chosen positioning strategy.
Aenerally, there are si1 basic strategies for product positioningG
?y attribute or benefit# This is the most fre8uently used positioning strategy. 5or a light beer, it
might be that it tastes great or that it is less filling. 5or toothpaste, it might be the mint taste or
tartar control.
?y use or application# +f you want e1treme processing you would go for a %70 processor
instead of +ntel processors. %70 spends a lot of resources on building high performance parts
than on advertising like +ntel.
?y user# ,ampushook is a social networking site used e1clusively by college students.
,ampushook is too cool for 5acebook and serves a smaller, more sophisticated cohort. -nly
college students may participate with their campus e#mail +0s.
?y product or service class# 7argarine competes as an alternative to butter. 7argarine is
positioned as a lower cost and healthier alternative to butter, while butter provides better taste
and wholesome ingredients.
?y competitor# ?7W and 7ercedes often compare themselves to each other segmenting the
market to just the crKme de la crKme of the automobile market. 5ord and ,hevy need not
apply.
?y price or 8uality# Tiffany and ,ostco both sell diamonds. Tiffany wants us to believe that
their diamonds are of the highest 8uality, while ,ostco tells us that diamonds are diamonds
and that only a chump will pay Tiffany prices.
$ositioning is what the customer believes and not what the provider wants them to believe.
$ositioning can change due the counter measures taken at the competition. 7anaging your
product positioning re8uires that you know your customer and that you understand your
competitionL generally, this is the job of market research not just what the entrepreneur thinks
is true.
Mow coming to %pple and their positioning strategy, %ccording to me %pple uses the
$ositioning by attribute and also positioning by user. Iet us see the different %pple products
and their positioning by attributeG
i7ac J H1treme hardware, costlier than the regular $,
7ac -S N # Aood graphics, many user oriented features more stable than windows
5inal ,ut pro J World class movie editing softwares, used by Steven Speilberg
i$hone J ,hanged the face of smart phones, the best hardware and software combination at
the moment.
+pod J 0urable, and well segmented into shuffle, nano, classic, touch, and many more to yet
launch.
%pple has positioned itself to a certain type of customer, wealthy people, innovators, people
with good jobs, good lifestyle, etc. +f %pple targets the poor man type, the trendy guys will stop
buying %pples, because everybody can and %pple is not the $orsche of the computers
anymore, this would hurt more the brand than maybe the increasing sales because of lower
prices, and in good times, where everybody has more money, %pple would have the problem
that they cannot rise prices, because everybody e1pects a cheap %pple !the macroeconomics
deflation problem&.
Points of parity and points of difference
%pple has generating a lot of talk with the new 7ac?ook %ir and as might be e1pected there=s
a lot market buzz as well. + think the best way to tell is to compare this computer with the
other %pple laptop computers of similar size. Since %pple=s last offering is the 7ac?ook $ro +=ll
use this as the comparator. To discuss points of parity and points of difference + would like to
take to of %pples great products the 7ac?ook pro and the 7ac?ook %ir. +=ve heard it said that
the 7ac?ook %ir is just a designer laptop for trendy types to show off with. + don=t think this is
8uite fair. The 7ac?ook %ir specifications 8uite plainly demonstrate, this is a serious laptop. %
better description might be that this is a business laptop without the fancy graphics or sound.
% machine designed for travel not merely to impress.
Size and WeightG This is likely one of the most important considerations. @ou have to haul
this thing around with you everywhere you go. % few pounds here or there can add up 8uickly.
The 7ac?ook $ro weighs 5. pounds
The 7ac?ook %ir weighs ! pounds
Weight SummaryG The 7ac?ook %ir weighs F.6 pounds less than the 7ac?ook $ro.
"hic#nessG The two 7ac?ooks differ in thickness by a 8uarter inch !'O6& and this could also
affect how well it travels.
The 7ac?ook $ro is one !'& inch thick
The 7acbook %ir is slightly less than three#8uarter !:O6& inch thick
Size SummaryG The 7ac?ook %ir is one 8uarter inch thinner than the 7ac?ook $ro.
Processing Po$erG ?oth 7acbooks use the +ntel ,ore F 0uo processor, however they differ
in processor speed. The 7ac?ook $ro actually has three options when it comes to processor
speed to the %ir=s two. ?oth machines have an IF 67ega?yte cache.
7ac?ook Pro +ntel ,ore F 0uo at %.%, %., and %.& 'iga(ertz
7ac?ook Air +ntel ,ore F 0uo at ).& and ).* 'iga(ertz
Processor Summary+ % higher number here is better.
,ideo Processor-s.GThe 7ac?ooks differ in this area. This must be one of the areas %pple
chose to save size !thickness& and weight !a difference of over two pounds&.
The /acBoo# Air uses the embedded +ntel A7% N:'22 graphics subsystem.
Hmbedded meaning it=s part of the motherboard. ,onnected to an e1ternal monitor via
the micro#0i port, the ma1#res in e1tended desktop mode is )0%*1 by *11 pi1els
!*2"z&. Thie highest resolution available is )02%1 3 )%11 through the 7icro0+ port to
an e1ternal monitor.
The /acBoo# Pro uses a separate M+0+% Ae5orce /*227 AT graphics processor
that=s connected to the dual#link 0+ connector. +n the e1tended desktop mode, the
ma1imum resolution for the e1ternal display is %01* by )05!& pi1els !*2"z or )<"z&L
mirrored mode, the ma1imum size is ',*/2 1 ',2<2.
,ideo SummaryG The 7ac?ook $ro has better video both in the machine and connected to
an e1ternal monitor. So if superior graphics are re8uired the $ro might be the better choice.
Since the 7icro0+ is also e1pected to support the e1ternal optical device using the two
simultaneously may be problematic.
SoundG Sound 8uality for the two machines is about e8ual but the actual e1ternalization of the
sound e.g. how you the user hear it is something else.
/acBoo# ProG "as stereo speakers built in to the case. @ou can also connect e1ternal
speakers or headphones via the headphone jack or via a bluetooth device.
/acBoo# AirG "as mono output to its speakers. 5or stereo output you will need to
attach speakers or headphones to the headphone jack or a bluetooth device.
Sound SummaryG +f sound 8uality to a group of users is important the 7ac?ook $ro might be
the better choice.
StorageG This is another area %pple changed to save size and weight. +n order to keep the
Air under one inch thick %pple resorted to a smaller thinner disk drive.
/acBoo# AirG Bses a './#inch $%T% !parallel %T%& drive off of a standard $%T% bus.
This means the drive, though smaller, is slower.
/acBoo# ProG Bses the larger, faster S%T% !serial %T%& drives off of a '.<Abps S%T%
bus.
Storage SummaryG This mean that if writing to and reading from your disk storage is
important the /acBoo# Pro is likely the better choice.
Wireless 4onnectivityG The 7ac?ook %ir uses /2F.''n Wi5i connectivity with a ma1imum
throughput of )6 7egabits per second and data rate of F6/ 7egabits per second. This is the
fastest of any of the /2F.'' standards. Wireless transmission of )2 meters !F:2 feet& indoors
!depending on wall construction& and F<2 meters !/F2 feet& outdoors means this wireless
standard also has one of the longest ranges of any of the /2F.'' networking methodologies.
Brand element
The memorability of this product is high thanks to the name of their products, for e1ample
i7ac, iWork, iIife or even i$hone. They all have have 3i4 prefi1ed to their names to signify
+nternet or innovation and most of all interesting. %ll %pple products are known for their
breadth taking user interfaces and custom graphics. -ften known as the rich boy=s $,, %pple
always was remembered as a premium brand of products !computers to start off with&.
The name %pple is rather not so meaningful because 3%pple4 normally used in a
conversation get a fruit in your mind but for anyone and everyone who has a computer and an
+nternet connection would always related it with %pple +nc.
%lso the transferability of this product is low. This became clear when all their products use a
uni8ue trade marked name like the i$hone or i$od etc although they all use %pples brand
values and position.
The apple logo is fle1ible over time. +t has been used for several years already and today it
does not look old#fashioned at all. So the adaptability of %pple is good as well. +f you look
below the apple logo from the past till date and the change in itG
%pple is a protected, registered trademark, protactability being the fifth criteria.
Brand communications
+n F22*, %pple released a controversial series
of twenty#four Straw man >+=m a 7ac, +=m a
$,> advertisements as part of their Aet a 7ac
campaign.
The ads, which are directed by $hil 7orrison,
star actor Justin Iong !%ccepted& and author
and humorist John "odgman !The 0aily
Show& as a 7acintosh !7ac& and a $,,
respectively. The format for each commercial
is similarG Iong introduces himself as a 7ac
and "odgman introduces himself as a $,
!assumed to be running the 7icrosoft
Windows operating system&, then the
particular facet of computing is stated, after
which the 7ac is depicted as being able to do
whatever the $, is able to do, but does it
8uicker, more safely, more creatively, or with
more versatility.
Since the launch of the original ads, similar
commercials have appeared in Japan and the
BC. While they use the same form and music
as the %merican ads, the actors are specific to
those countries.
The BC ads feature famous comedy duo 7itchell and
WebbL 0avid 7itchell as the $, and Pobert Webb as
the 7ac. The Japanese ones are played by Pahmens,
with Jin Catagiri as the $, and CentarQ Cobayashi as
the 7ac.
+n F22) during the launch, a new i$hone print ad has
debuted and is featured in the %ugust F22) issue of
0etails 7agazine. The ad features a right#facing
i$hone on a black background, with a hand coming
from the right, seemingly lit only by the phone,
interacting with it. ?elow the image is the tagline
3Touching is believing.4 7ac0ailyMews has suggested
that in light of the 3Jesus $hone4 or 3Aod $hone4
moniker some have applied to the i$hone, the ad may
be deliberately referencing 7ichelangeloRs The
,reation of %dam fresco found in the Sistine ,hapel.
The ,reation of %dam is a fresco on the
ceiling of the Sistine ,hapel, painted by
7ichelangelo circa '<''. +t illustrates the
?iblical story from the ?ook of Aenesis in
which Aod the 5ather breathes life into %dam,
the first man. ,hronologically the fourth in the
series of panels depicting episodes from
Aenesis on the Sistine ceiling, it was among
the last to be completed. +t is one of the most
famous images in the world.