In this report, I will represent the product, Apple G4 PowerBook(c) laptop by the Apple Computer(tm), regarding the marketing mix- Product, Price, Place and Promotion, which are commonly known as 4P. The product is thoroughly observed in four different retail stores, located in different places in London, UK; as required to prepare this report. In order to make the report fully understandable to the readers, I think it is necessary to write a bit about the product and its manufacturer.
Apple Computer: The Company in a nutshell
Apple Computer, Inc. designs, manufactures and markets personal computers (PCs) and related software, peripherals and personal computing and communicating solutions was born in 1976 by the two foreseer of technology world, Steven Wozniac and Steven Jobs. Its products include the Macintosh line of desktop and notebook computers, the Mac OS X operating system, the i-Pod digital music player and a portfolio of software and peripheral products for education, creative, consumer and business customers. Apple is recognized as an unparallel in computer designing and compatibility. The sleek and state of the art design of the Apple’s products snatch away the consumers mind quite easily than the rest.
Apple has several product lines featuring Desktop Pc, Laptop Pc, Software and related accessories. It has also paved into a new area beyond its realm introducing ‘i-pod’- an mp3 music player which has a successful hit on the road after its launching.
The revenues of Apple computer rose 33% to $3.92 billion for the six months ended on 03/04.
Apple Power Book G4: A short glimpse
The PowerBook G4 (12″) series was announced in the September, 2002. It is a speed bump over the previous model. PowerBook G4 is shipped with both Combo and SuperDrive configurations each with 1 GHZ of processor speed, 256 MB of RAM, 40 GB of hard disk, 32 MB of graphics memory and 12″ of TFT display along with other features.
Selected Retail Stores:
Apple’s authorized sales, service and maintenance center, run by Square Group.
Located at the Tottenham Court Road.
A high street flagship departmental store. Located at the Oxford street, a very busy place with huge traffic of consumers.
A very well renowned electronics and computer parts retailer. A subsidiary group of Dixon group PLC. Located at the Stepney green, east London.
An electronics and computer parts retailer. It is also a subsidiary group of Dixon group PLC. Located at Oxford Street.
The selected four retailers, who sell the Apple G4 PowerBook, are –
Evaluation of Marketing Mix:
Now I will try to present the elements of Marketing Mix (Product, price, place and promotion) in relation with Apple PowerBook G4.
A product assortment is the set of all products and items that a particular seller offers for sale (Kotler, 2003). In Apple Center, it is observed that, it sells all of the Apple brand product lines since it is the authorized retail outlet of Apple computer run by the Square group Ltd. The retail store has mainly targeted the high income profile savvy customers, who are highly brand loyal and afford to pay a higher price than on other brand’s product. It sells the Apple PowerBook G4 laptop series in different configuration, like 12″, 15″ and 17″ TFT monitor according to customer’s demand. The store also sells Desktop pc, laptop pc of different series, software, entertainment gadgets and accessories. But all of these are of Apple brands. So in terms of product assortment, the store’s merchandise can be termed as narrow, since it sells only the Apple brand product. At the same time, the product range is deep as the store sells different varieties of Apple product.
On the other hand, John Lewis, a high street departmental store, has a wide array of different consumable product range including home furniture, household equipments, electronics, Computers, Hi-Fi system, gardening tools, fashion accessories, toys etc. it’s target consumers are also high profile income people, who are enthusiasts, brand and quality conscious. So, the positioning of the product Apple PowerBook G4 12″ is quite appropriate in this departmental store. The product Apple PowerBook G4 falls in to its computer product category. In this category it sells desktop, laptop, handhelds, software and accessories.
It sells Apple brand desktop and laptop pc of few series including Apple PowerBook G4 with different configuration as supplied by the manufacturer. The other brands which are substitute to the Apple PowerBook G4 are Sony, Hewlett Packard, Toshiba and Samsung. The product assortment of John Lewis is wide as they sell different varieties and kinds of product within the store. At the same time, regarding the Apple brand product, the store’s merchandise can be described as shallow, since they don’t sell all the apple product lines. It sells only apple brand desktop and laptop PC of limited series.
The other remaining two stores are PC World and Dixons. Both of which are subsidiary group of Dixon group PLC. PC World is known as UK’s number one computer and computer accessories retailer. It has varieties of computer brands of desktop and laptop PC’s. It also sells Tablet pc, organizer, printers, Entertainment gadgets and accessories. The product Apple PowerBook G4 series laptop has its place in the store with different configuration. Its substitutes are Packard Bell, Toshiba, Fujitsu, Compaq brand laptop. The target consumers of PC World are midrange to high income people, who are interested about the technology world.
That’s why the store has different varieties of PC with different price. The product assortment of this store is narrow as it sells only computer and related accessories , but at the same time it is bit deep, since it sells most of the product line of Apple brand like i-mac, G5 including the selected product Apple PowerBook G4.
The Dixons is a high street retailer of Electronics, Photographic, Communication and Computer equipments. It sells computers, photography, Hi-Fi system, TV Video and DVD, Gaming, Software and accessories. It sells only the laptop series including Apple PowerBook G4 laptop with different configurations apart from other Apple brand product line. The substitutes of the Apple PowerBook G4 are Compaq, Hewlett Packard, Toshiba and Sony brand laptops. The Target Consumers of Dixons are same as PC World’s. The product assortment of Dixons is wide compared to PC World’s as it sells not only the computer products but other electronics and entertainment gadgets like DVD, TV, photography etc. At the same time it is bit deep as it sells other products of Apple brand same as PC world’s.
Price is the one element of the marketing mix that produces revenue; the other elements produce cost. (Kotlar and Armstrong, 2004). The main objective of a retailer is to maximize profit and to gain market share. Hence, the strategy of setting price of products plays an important role in gaining those objectives. In an article, posted on the internet ; it is seen that, With the PowerBook G4 series laptop, the company, Apple saw 9% sequential growth and 203% year over year growth in PowerBook sales, totally 176,000 units for the quarter and $348 million in revenue in the year 2003. In Apple center, it is observed that, the price of the Apple PowerBook G4 12″ laptop is cheaper among the other retail store. This is because; the Apple center is authorized retailer of Apple computer. So it can set the price lower than the other retail stores to become the market leader.
Also having been enjoyed by cost advantage resulted from the economies of scale in production; the Apple computer can sell its products in its own retail outlet at lower price. The price of the product Apple PowerBook G4 12″ laptop offered by the Apple Center is ï¿½1149 (including VAT), which is the lowest price among the other retailers. The price depends on the configurations. If the consumers want higher configurations like 15″ monitor or more, extra capacity devices; the price of the selected product will go up. The store sells other series of laptop like i-book at comparably lower prices.
On the other hand, the departmental store, John Lewis has offered the price ï¿½1299.00 (including VAT) for Apple PowerBook G4 12″ laptop. Actually the target consumers of this retail store are posh and extravagant. Also, it has other retailers of computer product around it, like Dixons and many others. So this store follows the competitive pricing policy in regard with its competitors. The other laptop brands, it sells, have higher or lower price regarding the Apple PowerBook
G4 12″ laptop. The store is not a market leader regarding setting the price of Apple PowerBook G4 12″ laptop, since the price is almost higher (including VAT) in comparison with Apple Store. It’s not best value product as well. Since it has other laptop brands below the price it offers for Apple PowerBook G4 12″ laptop.
The Dixons and the PC World follows the same uniform price like Jhon Lewis’s for Apple PowerBook G4 12″ laptop. The price is ï¿½1299.00 (including VAT). This means they follow the competitive pricing policy. They also follow the Hi-lo pricing policy. These retail stores sell laptop computers of both high and low prices. For an example, PC World sells TOSHIBA P10-304 Intel Pentium 4 2.66GHZ Processor Laptop just for ï¿½819. The price they offer for Apple PowerBook G4 12″ laptop is higher than Apple center’s and almost the same of John Lewis’s. That means they are the price takers and market followers.
By assessing the retailers’ price for Apple PowerBook G4 12″, it is clear that, the product’s price falls in the midrange in laptop category of Apple center and John lewis , since their target consumers are supposed to be high income earners and they offer other laptops of different configuration and brands(except apple store) in higher prices. The PC world and the Dixons seem to be offering higher price for the Apple PowerBook G4 12″ in the perspective of their target consumers and other products in their laptop PC category.
Store location is often the most important decision made by a retailer (Levy and Weitz, 2001). A proper located retailer is able than any other to attract traffic of consumers. So, it’s vital for the retailers to review some particular checklists for site evolutions. It includes presence of competitors, Local demographic factors, site characteristics, demand for products in which the retailer is involved.
The Apple center is located at the Tottenham court Road. The demographic fctor of this place according to ACCORN type-21, the residents and shoppers in this area are prosperous enclaves and highly Qualified Executives, who are highly brand loyal and very choosy in buying pattern. The proportion of people earning living here is over ï¿½40,000 per annum is more than double the average. Actually majority of the laptop users are Executives or busy professionals. So, in a sense the location of Apple Center is perfectly chosen. It is a primary trading area of the store, because most of its buyers live nearby or travel to this place. The visibility of the shop is very good and layout of the store is well planned. Well spacious and the products are well displayed to attract customers.
The place is quiet reachable by car, bus and underground rail. Also the road leads to oxford circus or Oxford Street, which are the hub for shopping centers and commercial activities. The Apple center here seems to have less competition in its business. There is one computer retailer shop found ‘Morgan’, which sells desktop and laptop pc. But it doesn’t sell any product of Apple brand. There are also shops like Jessops- an electronics store, Argos, which sells few computer accessories, not the whole system etc. But they don’t seem at all they are in direct competition with Apple center, as none of them sell full range of computer products, specially apple brand. Unfortunately, there is no parking space of Apple center due to being in very busy and crowdy place.
Location of Apple Center
On the other hand, John Lewis, the high street departmental store is located at the Oxford Street, the place which is regarded as the center of London also UK’s premier place to shop (www.oxfordstreet.com). The place is always crowded with shoppers and tourists who are enthusiasts, choosy, fashion concern and updated and also have mid-high income profile. The departmental store is huge and the outlook is very eye-catching, well targeted for posh and rich people. It has several departments, each is well constructed and the products are well shelved. The entrance and the exit ways are well planned for such a big departmental store, which expects large number of crowd.
Actually the store John Lewis is located at the CBD (Central Business District). The nature of CBD is, it is hub of retailing in a city. Most of the retail stores and office buildings are located here. Vehicular and pedestrian traffic are highly concentrated as well (Berman and Evans, 1998). John Lewis falls in these characteristics. It has a wide access to public transportation like bus and underground tube (Oxford circus underground). It is also easily accessible by car as well. But there is no parking facility.
There are huge other retailers like Gap, Next, Debenhams, Selfridge, Marks N Spencer and competitors like Dixons, PC World, Dell, The Computer shop regarding the product Apple PowerBook G4 12″. But this departmental store is able to catch traffic of the consumers because of the quality it serves and an established brand name like John Lewis. This place is John Lewis’s primary trading center, since people from different places travel here to shop. Actually the shop is well located by its nature and in relation with its target consumers. Moreover, the displaying of Apple PowerBook G4 12″ is well visible and attractive. But the place is under congestion charge for parking vehicles nearby.
Location of John Lewis
The electronics retailer Dixons is also located at the Oxford Street. It has 297 stores in UK. It is a subsidiary group of Dixons Group Plc. The location’s characteristics are the same as above described in relation with John Lewis. The location can be called Dixons primary trading area as it is well crowded with customers. The store is not as big enough as it is supposed to be.
So, there is a bit of imbalance in layout of the store. The entrance and exit point should be much wider. Due to shortage of space the shelving of the products seem not appropriate. But it has wide assortment of products. Dixons target consumers are mid to high income earning people. So, the location is suitable for its business strategy. The store is also accessible by all means of transports (car, bus, tube). The competition is not severe here for the Shop Dixons.
It’s well established brand and quality product and service has enabled it to draw large flow of customers. The likely competitors in this area regarding it’s field are- Jhon lewis (Electronics and computer goods), Jessops (photography tools) and few others. Well, the PC World and the Currys- an electronics, computing and home appliances retailer, can’t be called as its direct competitors as they all are the subsidiary groups of Dixon group PLC. The display of the product Apple PowerBook G4 12″ is not undertaken properly. Even it’s not visible without the search.
The computer retailer PC World is located at the Stepney Green in east London. The sore is country wide renowned for its expertise in computer retail business for long time. The demographic factor according to ACCORN profile- type 23, there are large minority groups in this area. Most people are white collar employees or professionals. The average annual income is ï¿½20000-25,000. Actually, stylish and expensive brand like Apple doesn’t put much impression on the buyers in this area.
Because people of this type of group and having this type of income, tend to save money and like to find alternatives in affordable price. So, the product Apple PowerBook G4 12″ is not well positioned in this place, I think. So, the target consumer of PC World is mid range income earning people. The place, where PC World is located is quite accessible by bus, tube (Stepney Green Underground station) and private transports. The store is very spacious and the products are well categorized by different sections in the store.
The visibility of the product of Apple PowerBook G4 12″ is clear and well placed among other brand of laptops. The presence of the competitors is very limited in a word. The shops next to it are Currys and Halfords – a retailer of car parts, bikes and accessories. Though Currys sells desktop and laptop PCs, it doesn’t have the product Apple PowerBook G4 12″. Moreover, Currys and PC Worlds are the subsidiary groups of Dixons Group Plc. So PC World is out of fear of direct fierce competition. The retail store has a huge parking space. This is a positive aspect of attracting customers.
Location of PC World
Promotion has been defined as the coordination of all-seller initiated efforts to set up channels of information and persuasion to sell goods and services or promote an idea (Ray, 1982).Companies spend billions of dollars each year on promotion. No doubt that, all the flashy and flamboyant advertisements in media is now an effective weapon for the marketers to grab the attention of the customers.
Apple’s computers have already set a position in the mind of the prospective buyers as the most gorgeous looking hi-tech product, which is highly functional as well.
The Apple Center visited, promotes the product Apple PowerBook G4 12″ laptop quiet effectively. It has a service, maintenance and installation support system by the apple’s technical ‘Know how’ experts. The technical support on the phone is readily available for the customers. With the phone order it gives 1 year warranty for the product. But incase of shop dealing the offer extends to 4 years. Recently Apple computer has posted an advertisement on the web, which is targeted at one particular segment- students. It says the all members of NUS (National Union of Students) will have 14% discount in the latest i-book and power book range. Apple computer use media like, Web, TV, and Magazine widely to promote its product. It also sales products online. Apple also advertises it corporate image strongly. This persuades the consumers to become the brand loyal.
In John Lewis, the promotion of the product Apple PowerBook G4 12″ includes-
2 year warrantee, free delivery of the product and 90 days service guarantee. The store lay out and the way it presents the Apple brand PC- are also part of promotion. It uses the media like magazine and web to promote products. The store, targeted at rich people, don’t usually use price as a promotional tool. The customer service is excellent. All departments attending staffs are knowledgeable and friendlier.
PC World, having 5000 product line through out 138 stores in the UK, is a leading computer retailer. Its promotional strategy is quite effective. For the product Apple PowerBook G4 12″ it offers 1 year free warranty, PC performance support system,
3 years total support, including health check, unlimited repairs and much more if customers agree with ‘PC performance support system’. The retail store use the website as offering of promotional sales like web specials, Bargain zone, Mark down pricing of products etc. It also uses media like billboard, TV, Magazine and newspaper. The customer service is not good as I had to wait a long in the store to enquiry about the product, though one showed up but didn’t know about mush of the product I sought.
On the other hand, Dixons promotional offer is quiet competitive. For the product Apple PowerBook G4 12″ laptop, it offers 2 years guarantee and 6 month free service. It also uses online sale promotion like web exclusive, Euro Fever and clearance. The store is not so big, so there is a huddle of products, which seems awkward.
Differences among the stores:
Observing the four retail stores I can sum like this, the stores vary regarding the product they offer, service they provide, the stores’ design and lay out and the promotional effort; though price seem uniform in those stores . In the perspective of the product Apple PowerBook G4 12″, Apple Center has the large assortment as it is the authorized retailer of Apple. Also as a market leader it offers the lowest price among the stores. All the other stores offer the same price. So, it is assumed that Apple Center has the most market share regarding the product and it also enjoys competitive advantage as being authorized retail outlet of the manufacturer.
In case of site selection, John lewis and Dixons are well located in commercial hub like Oxford Street. But PC World does not seem choosing the right place in selling the product Apple PowerBook G4 12″ due to demographic factors. In promotional activities all the retailers’ participation is quite noteworthy and strategic. But the Apple Center seems to be ahead in promoting its own brand. It uses all the media and the image of the brand helps a lot in this. A strong brand image doesn’t need any farther promotion. John Lewis, famous for exclusive product range and being a prestigious departmental store, has been able to establish a good corporate image to its target customers. The environment and the layout of this store is very well built and planned. On the other hand, having long been in the computer retailing business,
PC World has a good reputation for quality affordable products and specialist services. Dixons follows the same. They both have large market share for computer based products.
Finally, it can be asserted from that, all the four retailers are quite established in the market and they have got satisfied customers (some are delighted as well) resulted from their business. All are trying to implement the marketing mix competitively and efficiently.
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