APPLE’S IPOD MARKETING PLAN FELICIA SUSHYCKI

MARKET SUMMARY Market: past, present, & future  Apple first introduced the iPod in 2001  First model cost $399 for a 5gb model  It an exclusive Apple product sold by the company itself, or authorized resellers  Brand was able to move from an approximate 30% market share in 2002, to holding a solid 75% from 2005 and on  This success can be attributed to  Commitment to high quality user experience  Understanding consumer need (iTunes, video capability, health monitoring)  Pricing strategies (by 2007, Apple had iPods ranging from $79 to $399 Steve Jobs, former CEO of Apple, unveils the Original iPod Source:

PRODUCT DEFINITION “With iPod, Apple has invented a whole new category of digital music player that lets you put your entire music collection in your pocket and listen to it wherever you go,” said Steve Jobs, Apple’s CEO. “With iPod, listening to music will never be the same again.” (23 October 2001,  Since being introduced in 2001, the iPod has gone on to develop into the iPod mini, iPod shuffle, iPod video, iPod touch and also a major component in the development of the iPhone and iPad  iPod offers compact size, a large internal storage and quality  It offers on-the-go playability, music downloads from anywhere with wifi or 3G and new “trendy” feature such as health monitors The iPod Touch offers music playability, along with a number of other applications and web compatibility.

TARGET MARKET Demographics Males and Females Ages 8 – 65  Very user friendly, however may present challenges for those not familiar with computers in uploading songs  Applies to such a large age demographic as general music listening is not limited by age International / Multiple Languages  Multiple language settings First World Countries  Requires extra money to purchase, not a necessity of life Psychological Trendy, Technology Seekers  Apple is a leader in technological innovation and will be the choice of customers looking to be the first owners of a new product Brand Loyalists  There are many customers who stay loyal to Apple products alone million-ipod-touches/

COMPETITION The competitive landscape for an iPod Touch 4 th gen  Samsung Galaxy Player 3.6  Advantages: Similar screen-to-body ratio, larger camera megapixels, micro SD port, FM radio  Disadvantages: No video calling, small overall body  Microsoft Zune  Advantages: same touch capabilities, apps available  Disadvantages: Connectivity issues, poor company readiness  Motorola Moto G  Advantages: Front facing camera, high resolution, large battery  Disadvantages: no SD slot, lacks the “trendiness” of iPod, heavy iPod-touch-4th-generation,Motorola-Moto-G/phones/7054,5384,8208

POSITIONING

ADVERTISING Strategy & execution  Along with introducing a revolutionary product, Apple also set themselves apart from the competition by introducing captivating, eye-catching and trendy advertisements  The iPod was introduced prior to the social media age, at a period when traditional mediums still outnumbered that of new media  In 2004, Apple spent $287 million on advertising, but sold $4.5 billion worth of iPods in the same year  In recent years, new media advertising has begun to takeover with the advent of platforms such as YouTube, Facebook, Twitter and web forums  Taking advantage of the social atmosphere and connecting to the user, Apple has managed to keep advertising costs lower than it competitors  Also note, Apple does have fewer items to advertise, but this also lends itself to a greater market focus

ADVERTISING EXPENSES COMPARED budget-is-tiny-compared-to-microsoft-samsungs/

FINANCIAL FORECAST Known Data (Apple Financial Reports)Forecasted Data in millions ($) Revenue65,225108,249156,508170,910216,552247,882277,904316,390347,066 Expenses7,29910,02813,42115,30518,36621,00523,47726,32728,882 Profit57,92698,221143,087155,605198,186226,878254,427290,063318,184 Note: As Apple does not specify expense details for each product line, I used calculations for all expenses and revenues for all Apple products. This suits the iPod product as newly established products such as iPhones and iPads have integrated the iPod capabilities within their own functions. According to financial forecasts, by the end of the 2018 fiscal year, Apple is expected to see $318,184,000,000 in overall profit. Operating expenses are expected to stay relatively low.

FINANCIAL FORECAST

DISTRIBUTION Distribution strategy Channels of distribution  Online  Apple’s own website is a one-stop-shop for genuine and authorized Apple products  They offer specialty services not offered elsewhere such as personal engravings  In-Store  The number of Apple Stores has been growing in the past years  Offer’s an in-person experience with Apple experts  Third Party Retailers  Authorized sellers such as Best Buy and Wal- Mart account for a large portion of iPod sales  Offers convenience of a big box store with store and Apple warranty guarantees Number of Apple stores worldwide of-apple-stores-worldwide-since-2005/

THE IMPACT OF THE IPOD Revolutionized the Portable Music Device Industry  User friendly, larger storage space, increased accessibility Influenced New Model Designs  Moved from the rotating wheel to touch screen, influencing other designs from competitors Adapted to the progress from CDs to digital, downloadable songs  iTunes is an industry leader in music downloads and it the connective program for uploading music to the iPod

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