Apple’s marketing relationship building with the target customers Essay

1. Introduction With the intensified competition and the rapid development of information technology, firms are facing unprecedented both opportunities and challenges in marketing. Marketing is a social platform to provide chances for individuals and groups to obtain what they need and want through exchanging various products with others (Kotler, 1974).In the contemporary society, people can not live without marketing with others which is much more important to firms. This report tends to evaluate how Apple-one of the most innovative and creative companies builds marketing relationships with its target customers through brand building. What is more, this report attaches much importance to customer profile which reveals some basic information about customers. This report is organized as follows. The first section is the introduction. The second part shows how Apple’s customer profile affects its brand building to have a closer marketing relationship with customers. The third one illustrates how Apple builds its brand and gradually builds the marketing relationship with customers through branding and customer profiles. From this part, it will be clearly clarified how Apple’s brand has amazing magic to attract so many fans. The last section is the conclusion. 2. Evaluation about customer profile of Apple According to Barron’s Marketing Dictionary, customer profile is the description of a customer group based on various demographic and psychographic characteristic. Apple collects customer profile through customers’ downloads in the app store. And these downloads are limited to Apple-buyers who have credentials. From these credentials, Apple can trace customers’ information thus finishing its profiles collecting. From Apple’s customer profile, it can be found that: ï  ¬Most Apple-users are young with professions and students take great part in the using of Apple products. A recent survey in 2008 based on the profile of iPhone users showed that most of the iPhone users are young and about 75% of iPhone users have used products of Apple before. (The Apple iPhone: successes and challenges for the mobile industry, 2008). It can be found from the picture below which shows the age distribution of iPhone users that most iPhone-users are beyond 40 years old and half of iPhone users are under the age of thirty. Figure2-1: The age distribution of iPhone-user Besides Apple’s customer profiles show that most of (79%) Apple-users are employed and 16% of Apple-users are students. In general, iPhone users tend to adopt progress of new technology. The research found that most iPhone-users are in the position of professional and scientific services, arts and the information and technology industry (The Apple iPhone: successes and challenges for the mobile industry, 2008). In addition, about 66% of households with Apple devices earn $60,000 or more in their income, compared with just over half of non-Apple users can earn that much (Apple profile report, 2008). In addition, from these two pictures below, it can be found that Apple users have obtained a higher educational level. From the Apple profile report 2008, it can be found that 68% have completed a 4-year university degree and even higher educational level like post-graduate degree or doctor degree. By comparison, only 45% of non-Apple households have reached this high educational level. It seems that Apple-users usually have higher educational level and higher incomes which help to afford them a higher disposable income, so that Apple’s high price not a barrier to them. (Apple profile report, 2008). In all, it can be concluded that Apple is favored by the economically elite. Figure 2-2: The working conditions of Apple-users Figure 2-3: The Educational level of Apple users Figure 2-4: The educational level of non-Apple users (Sources: The data comes from Apple profile report 2008) ï  ¬Apple-users take good advantage of internet. From the picture below, it can be found from the Apple profile report 2008 that 63% of Apple users spend more time using their computers to search the internet than watching TV. But only 57% of non-Apple users spend more time on computers than watching TV. While when comes to enjoying the fun on the internet, the difference between Apple users to non-Apple users is only slight. It has been found that there are almost 60% of Apple users keep discovering more ways to use the internet for fun and about 58% of the non-Apple users try to do that (The Apple iPhone: successes and challenges for the mobile industry, 2008). Since Apple-users are usually with higher level of education and most of them are employed, it is not strange that they take good advantage of internet and they also know better to use their devices for a better life. But Apple users still do not have better ideas to enjoy the fun of internet with their innovative devices. It could be a challenge for Apple to come up with new ways of enjoying the fun of internet with Apple devices. Figure 2-6: Comparison of Apple-users to non-Apple users on time-spending with computer and TV (Sources: The data comes from Apple profile report 2008 ) ï  ¬Apple-users are loyal to Apple’s products. What is more, it has been found that about Apple-users are loyal to products of Apple. From a survey on whether customers who use iPhone now have any other Apple devices, it has found that 49% of iPhone-users have used iPod previously. 20% of iPhone-users have used Mac and iPod and only 5% iPhone-users have once used Mac but no iPod. Only 26% of iPhone users do not use iPod or Mac before. So from the survey, it can be found that about 3 quarters who use iPhone today once have used Apple devices previously. These findings show that Apple-users are loyal to Apple’s various kinds of products and customers are quite satisfied with products of Apple. Figure 2-5: Did you own an iPod before you got your iPhone? To conclude, Apple with its various kinds of fantastic and innovative products such as iTunes, iPod, iPad, iPhone attract young people and turn them to be loyal customers of Apple. These customers who have high income or high educational level help to make the brand of Apple to have high status in the markets. And these customers’ love of Apple not only maintains brand loyalty of Apple but also attracts more and more customers get in love with Apple. 3. Analysis of how Apple builds marketing relationship with customers 3.1 Apple’s brand building with branding Brand has many advantages which companies can take to get closer to customers for more sales including improved perceptions of product performance, greater customer loyalty and increased marketing communication effectiveness (Keller, 2009).It is well acknowledged that brand has vital importance to a company even to a product or one kind of service. Especially in this fast-changing world, products are getting to be more similar because of the fierce competition which makes brand to be the difference between various products. Brands help to build sustained relationship with the customers. Strong brands lend endurance and performance to an organization and protect it from the market turbulence and uncertainties (Kapoor & Kulshrestha, 2011). In addition, brand gives customers a sense of reliance even makes them feel a better quality of life. Brands make meanings that become conventionally understood and shared across interpretive communities. (Holt, 2010, McCracken, 1996, and Kats, 2006 etc). The brand concept of Apple is â€Å"think different† which has last for over 30 years. From the creative and innovative products like iPod, iPad and iPhone, Apple always brings customers surprise and defines how to â€Å"think different†. In addition, Apple pursues to build a humanistic corporate culture with a strong corporate atmosphere to inspire employees to work voluntarily which can leave good impression on customers (Kahney, 2012). The famous global brand consultancy Interbrand which aims at creating and managing brand value released â€Å"2012 Best Global Brands† list, Apple jumps into the ranking 2 in the world, and the brand value growth is 129%. The brand of Apple has been a miracle in the global world. How dose the brand of Apple grow so quickly in the contemporary society? The following part will investigate this problem. The first step of is to get the customers’ attention. The advertisement of Apple has always maintained surprise which arouse the attention of customers. Since Steve Jobs returned Apple, the first release of iMac, either the video or the outdoor propaganda is featured with characteristic of Apple which makes the brand of Apple unique. Al Ries and Jack Trout pointed out in the book of 《The 22 Immutable Laws of Marketing》in 1994 that if an enterprise can not be the â€Å"first† in the consumers’ choices in the industry, then the best way is to create a new category to attract consumers. And the â€Å"opposite Law† pointed that to occupy the minds of consumers as the â€Å"second† best choices; the brand communication strategy is not to try to go beyond the â€Å"first†, but to be different. In the early eighties, Apple is trying to compete with the industry leader-IBM and then rapidly gain the attention of consumers. Through the long advertising campaign, such as â€Å"1984†³and â€Å"Think different†, Apple has built the spirit of innovation and fearless which brings the concept of the brand. Later with the promotion of iPhone and iPad, the advertisement of Apple started to focus on elite people. The people who use Apple’s products in the advertisement are usually well educated and pursue a higher quality of life. Through these advertisements, the brand of Apple has been positioned as elite and high quality of life. With customers’ attention, they are interested in the product of Apple and have the desire to buy the product. The productions of Apple’s products are tools for those who are ambitious and passionate to change the world. To conclude, through segmenting the targeting markets, Apple finds its own position and its target or potential customers. Products like iPhone, iPad, iMac are innovative and fashion which are favored by those who have high income with professions or those who are pursuing fashions. To them, Apple’s products are unique and innovative. By meeting customers’ demands and satisfying their psychological needs, Apple has built its branding and gradually makes the brand meaningful and attractive, thus making the brand o f Apple world-famous. 3.2 Building marketing relationship with branding and customer profile Marketing relationship is a process including identifying target or potential customers, establishing relationship with them, maintaining these customers and finally enhancing relationships with them (Gronroos, 1997). And in order to build marketing relationship with customers, it is of great importance to know better about customer relationship management. Customer relationship marketing is to maintain brand loyalty and stimulate repeat and even more purchases of customers (Murdy & Pike, 2012). Kumar (2010) pointed out that customer relationship management is the strategic process of targeting the important customers and provide them with well-considered services to shape the relationship between a company and these customers. The goal of the marketing relationship of customers is to optimize the interest of the customers and satisfy their needs. What is more, Taleghani, Vhirani and Mirrashed have mentioned in 2011 that the strategy of relationship marketing is based on creating, developing and maintaining relationships with customers. Through the brand building, Apple gradually establishes marketing relationship with customers. Customers start to pay attention to products of Apple and they are quite satisfied with these products. And with the brand being more meaningful and inspiring, customers are impressed with positive brand images of Apple. Gradually the brand of Apple has been identical for customers which help Apple to build the first step of marketing relationship with customers. And the second step for marketing relationship building is achieved by collecting customer profiles. Apple takes advantage of its customer profile to find their target customers, and to maintain brand loyalty. Through the information of customer profile, Apple knows exactly who bought their products, when did they buy the product and how many times did they buy the products. Depending on customer profiles it collects from these downloads of customers, Apple get a better understanding of its customers and can use these information to satisfy customers’ needs, thus maintaining brand loyalty and providing warm services according to customers’ needs. In all, the customer profile of Apple provides the knowledge needed to posit its target and potential customers and enable Apple to focus on marketing and branding efforts more effectively which finally help Apple to build marketing relationship with its customers. Thirdly, despite the innovative and amazing products of Apple, it also provides customers with the delicate services which help to enhance marketing relationship with customers. It has been said that Apple has five stages of service including approach, probe, present, listen and end. â€Å"Do not be manipulated by the machine but to manipulate machine yourself† is Apple’s customer-oriented concept to produce new products. In 2007, one month before the iPhone is officially on sale, Jobs asked developers to switch the phone’s plastic screen to tempered glass screen. This has solved the problem of the screen be scratched by keys. In addition, the Voiceover helps the blind to read texts and ever enter information. Apple always stands on the side of customers and think for them. These warm services and Apple’s caring about customers help Apple maintains brand loyalty of customers. By the three steps of establishing the brand of Apple, maintaining the loyalty of customers and enhancing connection between customers, Apple builds the marketing relationship with customers. Although Apple’s marketing strategies has been quite effective which make the brand of Apple known all around the world. While there still exists some problems in Apple’s marketing. First of all, Apple’s marketing is too dependent on the leadership of Jobs Steve. He gives the brand of Apple the name of fashion, innovation and esthetics. Depending on his public influence, many of his followers choose to buy the products of Apple. With the left of Jobs, the brand of Apple may face some challenges. Secondly, the price of Apple is too high among its competitors. Although most Apple’s customers are of high income or well educated, the high price of Apple also make Apple lose some customers since some other products can satisfy their needs with fair prices. Last but not least, Apple has a big competitor-Samsung. As a latecomer to the mobile phone industry, Samsung has defeated Motorolaï ¼Å'Nokia and other competitors to become the world’s second largest mobile phone maker. The competition between Apple and Samsung will challenge the brand value of Apple. 4. Conclusion To conclude, brand is of vital importance to a firm or an organization. A strong brand offers reliance for customers and thus becomes a link to maintain customers’ loyalty. Branding helps to make products different and can choose the target customers. Through branding, Apple builds the brand which establishes the first step of marketing relationship with customers. By collecting customer profiles, Apple knows better about its customers which help Apple to maintain brand loyalty of target customers. In addition, through the delicate services and innovative products, Apple enhances the marketing relationship with customers. In all, Apple builds the marketing relationship by three steps including establishing the brand of Apple, maintaining the loyalty of customers and enhancing connection between customers. Although Apple has successfully built its brand and has good relationship with customers, Apple still faces many challenges including the left of its famous leader, the high price of its products and the strong competitors. Reference Gronroos, Christian. (1997) ‘From marketing mix to relationship marketing-towards a paradigm shift in marketing’, Management Decision, 35/4, 322-339. Holt, D.B. & Cameron, D. (2010) Cultural Strategy: Using Innovative Ideologies to Build Breakthrough Brands, Oxford University Press. Kahney, Leander. 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