This report is a study case with the title Apple versus Samsung: The Battle for Smartphone Supremacy Hearts up. For this study case was applied a lot of theory.
Global Marketing is the scope of activities outside the home market. Apple Company was the most valuable teach others company in the world. India is number 3 smart IPhone market. Next, the smartphone makers are setting their sights on China, India and other emerging market. For example: China, Hong Kong, and Taiwan (Apple’s second-largest market). Therefore, China and Europe also a Samsung’s key market.
IPhone is using Globalization (Standardization) theory as developing standardized products marketed worldwide with a standardized marketing mix and essence of mass marketing. Therefore, iPhone are standardized for the feature and functions no matter produced in what country as US, Brazil, China, Malaysia and others.
In marketing, product is a system made available for consumer use; it is anything that can be offered to a market to satisfy the desire or need of a customer. So, by mid-2014 Apple was preparing to launch several key new product (iPhone6 and 6+, Apple Pay). New wearable device, the Apple Watch would be introduced early in 2015. Therefore, iPhone Company are also create values by improving benefits as larger screens, a key features of the new devices and a new era of secure mobile payments .
Price is the quantity of payment or compensation given by one party to another in return for one unit of goods or services. Apple Company did not offer a lower-cost version of the iPhone. The price of iPhone 5c was about $100 lower than the new iPhone 5s. Customer have strong demand for inexpensive mobile phones. Therefore, launch of the iPhone 5s and ios7, a long-rumored lower-priced iPhone model was unveiled. Others companies was sell for much less than the iPhone 5. Apple lags far behind Samsung in terms of smartphone shipments (Samsung offer an Android phone for about-$100.) (By contrast, India consumers pay $500 for an iPhone $and about $850 for the iPhone5.)
Psychological of, affecting, or arising in the mind; related to the mental and emotional state of a person. As iPhone consumers can sign a multiyear service contract, they can purchases an iPhone 5 with $199.But other country must pay for full payments. IPhone are using the marketing strategic that influence consumer’s physical and mental to attract those consumers desire want to buy iPhone as using this plan to let consumers feel like they get benefits from this products.
Marketing Strategic is a plan of action designed to promote and sell a product or service. Cook announced that Apple was acquiring Beats Electronics for 3 billion. Beats is the premium headphones in the market. Dr.Dre and Jimmy Iovine is who founded Beats Electronics, which produces audio products and operated a now defunct music streaming service. They were added to rooter of Apple executives. The marketing strategic of the Apple Company acquiring Beats Electronics is because they want to make iPhone as monopoly in market. Next, Apple Company set the price of iPhone 5c was about $100 lower than the iPhone 5s. 5c was developed to target those who are not rich so the company set the price as value-based pricing (Net value = perceived benefits). The Apple Company are using 5c to highlight 5s and make the 5s sales increase.
Promotion is the activities that communicate the product’s features and benefits and persuade customers to purchase the product. Samsung spends more on advertising and promotion than Apple. It was widely reported that Phil Schiller ,Apple’s senior vice President for Global Marketing was concerned that Apple’s advertising had lost its edge.(Apple had a long-standing relationship with a single agency, Advertising) (However, a “Genius Bar” campaign timed to coincide with the 2012 Olympics was deemed a failure. In a subsequent e-mail to TBWA, Schilier admitted that he was impressed by arch-vival Samsung’s 2013 Super Bowl ad; by contrast, he noted Apple was “struggling to nail a compelling creative brief on iPhone. Therefore, the market issue was pushed to the forefront during the Academy Awards broadcast in spring 2014. Oscar host Ellen DeGeneres took a star-studded selfie (featuring Bradley Cooper, Jennifer Lawrence, and Batt Pitt, among others) with a Samsung Galaxy phone and posted it on Twitter. (Made social media history being retweeted more than 3.5 million times (Samsung had paid $20 million to sponsor the broadcast.) Cook Jobs and Schiller Park authorized the formation of an in-house advertising agency at Apple. About the monetary value the publicity the stunt generated, most agreed that Samsung had gotten the better of Apple.
Wants are goods or services that are not necessary but that we desire or wish for. For example, one needs clothes, but one may not need designer clothes. Nowadays, technology is advance. Everyone has used technology to communicate and enhance each other .Therefore, Apple Company understanding consumer’s wants so they created 5c that was designed to appeal an especially to consumer in emerging markets who could not afford a top-of-the-line smartphone.
Market segmentation is the process of dividing a market of potential customers into groups, or segments, based on different characteristics. Geographic segmentation means divides the market by locations such as religions, city size, density of area and climate .Apple rental stores are located in highly populated city around the world, global presence, with online presence official website in 88 countries. Demographic segmentation is market segmentation according to age, race, religion, gender, family size, ethnicity, income, and education. Those who are age 20 to 45, no matter gender males or females are the target of Apple Company.
Market target means selecting the segments that the company views as prospective customers and pursing them. Customers with high loyalty to Apple and social acceptance oriented is the segment which IPhone targeted. Customers with high loyalty to Apple is a target of iPhone Company. Apple’s loyal customers is a group of people who has strong loyalty to this brand and who are the big fans of the product of Apple Company. They know well about the features and the benefits of the products, they are willing to pay for the extra money to get these features. Therefore, the people who are middle to high class in the society are the target of the iPhone Company only. Therefore, consumer who are willing to take risk aversion or variety seeking new products as what Apple Company produces a new product are also the segment of the iPhone Company. Next, the social acceptance oriented is another segmentation for iPhone Company. The segment has people who track down after social status. Fashion and social acceptance are the main reason of their purchases.
Positioning is the process by which a company creates a distinct image and identity for its products, and brands in consumers ‘minds. For example, the 5S fingerprint scanner and the 5S camera, but not the new 64 bit chip (though this enables both). “IPhone 5C have an advancement of iPhone 5 with an entirely new design that feels great in your hand, and color that only Apple could do. However, iPhone 5S, the most advanced iPhone ever, with our most forward-thinking technologies. “So the 5C is the new iPhone, and its $100 cheaper, while if you want supercool new tech you pay more for the 5S.
1. Do you own a smartphone? If so, which brand did you buy, and why?
Yes, nowadays everyone own a smart phone. We choose iPhone because it give us a higher value compare to Samsung smartphone. An iPhone give us a higher satisfaction due to it’s product having a better feature, quality and performance satisfied our needs and wants compare to others smartphone.
According to paragraph 1, line 7, “apple is the most valuable tech company in the world. “Apple Company use a good marketing strategic is to focus on their product value but not the price. They doesn’t get scare to get involve in the price war due to they know their products value are worth. IPhone showed it value to customer and proposition in customers’ life. An iPhone function great with all devices, we can send our photos to others devices quickly and we can answer a phone call or send text messages from other devices such as iPad. Moreover, an iPhone have a better control of notification, the iPhone will separate the notification that received in different application. For the example, message from Whatapp is separate with the notification from “Facebook” therefore we are able to see the summary of the message. IPhone have the feature that worth of the price and they won’t get nervous about the price tag that Apple Company put on the iPhone. In additional, when we want to resell our iPhone in second market it is worth more compare to a Samsung smartphone because iPhone have a better quality and performance compare to other smartphone.
Apple being the first that has the topmost mind positioning in public. When someone talks about smartphones, Apple probably is the first brand that comes to mind. According to paragraph 2, line 3-6, “Apple reputation was based its proven ability to disrupt existing markets and create new markets with technologies and design innovation”. Apple company having a better brand equity than others competitor of innovating smartphone. IPhone become a device that bring strong mental and emotional associations to the customer as well as makes apple brand has a strong association in economical market. They create a fascinating visuals of iPhone to win over competitor which is simplicity in the device’s design .A bright and pure smartphone device reflect a consumers’ self-image or the way they see themselves.
Another reason why we choose to purchase an iPhone we can reduce our cognitive dissonance. According to paragraph 4, line 4 “Apple did not offer a lower cost version of the iPhone. A more expensive product is able to overcome our post-purchase dissonance because as a consumer, we will think the more expensive the product, the better the quality. Furthermost, we will look for reassurance. Since Apple Company have a good reputation in technology industry so there are able to attract those customers are lack of understanding of an iPhone. They will rely to store image and believe a well-known brand. Customer will judge the product based on the company brand name that the Apple Company have. Therefore, iPhone become a trustworthy product in the market.
2. In 2013, Apple introduced the iPhone 5C to attract consumers who were not willing or able to pay a premium for an Apple device. The price was about $100 less than the top-of-the-line 5S. Was this right pricing decision?
Yes, Apple Company make a right decision by introduced the iPhone 5C. IPhone 5C is able to target a larger market that can increase the profit for the Apple Company. As we know iPhone didn’t offer a lower cost version of iPhone to the market but iPhone 5C is a lower price device in Apple Company compare to others iPhone device can attract non iPhone user to purchase their product. According to paragraph 8 line8, “The 5c was designed to appeal especially to consumers in emerging markets who could not afford a top-of-the-line smartphone”. IPhone 5C is able to take emerging market away from Samsung with the colorful design and lower prices. Therefore a lower cost iPhone which is iPhone 5C can bring more sales volume to the Apple Company.
On the others hand, to compact the pricing pressure from Samsung so he Apple Company have to launched a lower priced version of iPhone to compete with competitors. They are using a High-low pricing strategy to introduce the iPhone 5c and iPhone 5s,the replacement of iPhone 5.They set iPhone5s and iPhone 5c in different prices which are $199 and $99 respectively. IPhone 5c use across the Psychographic segmentation. Based on customer different personality traits some customers will compare the price and fell the iPhone 5C is more affordable and better than iPhone 5s especially the customer lack of knowledge of a smartphone device. Moreover, few group of customer will based on their behavior which they would like to purchase a cheaper product even though they knew the feature might not be better than others iPhone device. By the way, this can increase the demand of iPhone 5c and increase the sales of Apple Company too.
3. Do you think Apple can continue to grow by developing break through products that create new markets, as it did with the iPad, iPhone, and iPad?
4. How has Samsung’s global marketing strategy, enabled it to compete so effectively against Apple?
Samsung divides their market segment by demographic factor. Samsung segment their customers by medium income level. Furthermore, Samsung divides their market segment by behavioural factor. Customers with high degree of loyalty is Samsung market segment. Next, Samsung also divides their market segment by psychographic factor. Customers’ lifestyle that want a smartphone that is well-known and affordable.
The target customers of Samsung are students. Students that do not have a high income will likely to purchase Samsung smartphones. Senior citizens that do not have a brand loyalty but want a smartphone that is well-known and affordable is also Samsung’s target customers. Moreover, customers with a high degree of brand Samsung loyalty is definitely the target customers of Samsung.
The position of Samsung is inexpensive smartphones. They offer smartphones that are affordable with qualities. Additional, Samsung brand is well-known all around the world which gives benefits to attract more customers. Besides, the design and innovative feature values also plays an important role of Samsung positioning.
Samsung smartphones are powered by Android system. The Samsung galaxy series are the ones that are popular. For example, Samsung galaxy S3 and Samsung galaxy Note. The Samsung galaxy Note also offer a larger phone screen than the iPhone to attract more customers. On the other hand, Apple is selling one type of smartphone which is iPhone. For example, iPhone 5 was the same in every world market.
Furthermore, the price of Samsung smartphones are inexpensive compare to iPhone. There are some Android-based models smartphones from Samsung offer much lesser than iPhone 5. In such a case, Samsung able to adapt customers’ strong demand for inexpensive smartphones in many developing countries. On the other hand, the price for iPhone is constantly high because they do not offer low cost iPhone.
Moreover, China and Europe are Samsung’s key markets. Samsung is working to access into US market. To attract customers from different regions, Samsung came out with several versions of Samsung Galaxy S4. For example, different processors will be used for different version of Samsung Galaxy S4. This is to suit the needs of customers from different regions. Diversely, iPhone 5 was the same in every world market.
Each year in Texas, Samsung will have a major presence at the SXSW interactive, film, and music conference. Besides that, in 2013, the TechSet Blogger Lounge and concert showcase presented by Prince was sponsored by Samsung and Samsung users able to get the access tickets. On the other hand, the conference seem to no visible presence of Apple.
Global marketing strategies are marketing strategies that a company adjust accordingly to match the conditions of foreign countries. Samsung is using global localization which also known as adaptation that mixing standardization and customization in a way that minimizes costs while maximizing satisfaction.
The price of Samsung smartphones are affordable with quality. According to the text, Samsung offers some inexpensive smartphones that are Android based to many developing countries. This is because Samsung is adapting customers’ strong demand for inexpensive mobile phones. For example, Samsung offer an Android phone for about $100 and Indian consumer pay $500 for an iPhone 4 and about $850 for iPhone 5. Unlike Samsung, Apple did not offer low-cost version of the iPhone.
Furthermore, Samsung is adaptable because according to the text, there are several versions of the Samsung galaxy s4. For example, Samsung will use different processors on the different versions of Samsung galaxy S4. This is to adapt the needs of customers from different regions. Diversely, iPhone 5 was the same in every world market. They do not change the components of iPhone to adapt the needs of customers.
Moreover, Samsung does a lot of advertising and promotions. They put a lot of effort to advertise their existing products and newly launched products. For example, Samsung staged a lavish event at Radio City Music Hall in New York to launch the Samsung Galaxy S4. Other than that, Samsung also sponsored the TechSet Blogger Lounge and concert showcase presented by Prince while the Samsung users able to get the access tickets. Unlike Samsung, Apple did not do a lot of advertising and promotions to advertise their products.
Other than that, Samsung also spent a lot of money in research development. Samsung Electronics relies heavily on market research on different countries. For example, there are 60,000 staff members work in dozens of Samsung research centre in many countries. On the other hand, Apple do not focus on the market research because Steve Job downplayed the importance of formal market research.
5. Accesses the prospects for the global success of Apple Pay and the Apple watch.
In 2014, Apple promised they will launch the apple pay as the key feature of new devices, as the new era of safe mobile payments. Cook had announced that the new wearable device, the apple watch, would be introduced in early 2015. They think that, in order for people to accept and get through to the new technologies, the devices need to change the method they live. According to the product: When we saw apple watch featuring voice control, Apple revealed that he talked to Siri all the time. According to his statements, the Apple watch will know that you’re looking at it and turn it on, so you don’t have to press any button. Other than that, it will also shut down when you look away, which something that no Android Wear watch can do. Cook also mentioned that this watch has become essential in his life, not only for notifications, but also the health advantages. Next, Apple pay provides high standards of privacy. Last but not least, these products will be doing well if they priced rationally and reasonable. Age and gender demographic will show that these products will success in each area of global marketing. Last part of Apple which is successful is Apple want to give an experience in both hardware and software.