Executive Summary
Smartwatches and fitness trackers are examples of wearable technologies are electronic devices that are worn by a person. PESTEL analysis was used to identify macro-level possible constraints on the application of antitrust laws to technology businesses as well as growth possibilities in the government-supported public-health campaign against the rising obesity epidemic. Apple joined the smartwatch market following the popularity of the iPhone, and the Apple Watch quickly rose to the top. This assignment will analyse a few crucial internal and external elements that may have a significant influence on Apple’s prospects for success. The value proposition for the Apple Watch will be identified in this research, along with any risks associated with the product’s market strategy and future market trends. The recommendations for the company emphasize that it should position itself in the larger watch market and collaborate with other businesses.
Introduction
Any company’s success in a cutthroat market depends on its marketing strategies, which take place along two dimensions: tactical and strategic. This research offers market scenario and segmentation studies to suggest Apple Inc., a tech firm, choose a target market. These recommendations will guide the creation of a strategic and tactical marketing plan for building the brand. Apple Watch is a cutting-edge, highly customizable smartwatch with a high-resolution touchscreen and a version of the company’s popular iOS that allows for the installation of thousands of third-party programs and the interchange of many watch bands to further a user’s sense of fashion. The number of sports or health-related applications that are already included and those that may be found on Apple’s App Store are particularly telling since they directly address the rising need for gadgets that can track various vital indicators (Tien, Dat, & Chi, 2019). The product’s purpose is to enhance iPhone usage by removing the need for the user to remove the phone from their pocket to control it.
Market situation analysis
An in-depth investigation of a company’s market presence based on internal and external variables is known as scenario analysis. By examining the internal and external aspects influencing a company’s overall success, situation analysis assists in guiding a company’s decision-making process. Every project planning process must include it since it identifies a company’s strengths, shortcomings, and areas for growth. The market situation analysis was performed with a combination of frameworks to ensure a thorough investigation of Apple Inc.
A well-known scenario analysis method that assists marketers in making wise business decisions is the 5Cs of marketing. They examine the five main factors that affect a company’s marketing choices. A 5Cs analysis (customer, context, company, collaborators, and competitors) determined the market situation by looking at both the macro-environment and micro-environment in which Apple Inc. currently presides. This information was then used to perform a Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis to identify future incentives and implications, subsequently providing insights for developing marketing strategies.
Finding profitable business sectors will be aided by a SWOT analysis. These areas are crucial to the company’s success and provide it with a competitive edge. By identifying these assets, a business can ensure that it keeps them and maintains its competitive edge. Finding strategies to delight clients better, accomplish goals, and reinforce weak areas that influence performance will be made more accessible by gaining a comprehensive and accurate understanding of the internal environment.
5C’s Analysis
The five most crucial marketing fundamentals are analysed in the 5C framework; customer, context, company, collaborators, and competitors. This framework analyses a company’s primary internal and external success drivers and uncovers its exposure to environmental risk. This framework is crucial to marketing managers’ success in order to make well-informed marketing decisions that capture and create customer value and ultimately lead to increased revenue and company growth.
Customers
Situation analysis requires a thorough understanding of client demands, wants, and purchasing habits. Around the world, there are 1.4 billion active Apple products and about 1 billion consumers (Bai et al., 2021). Many people are so devoted to Apple that whenever they release a new product, they immediately purchase it without considering the cost. In the USA, 50% of Apple consumers are pleased with the company’s customer support, while 38% are pleased (Bai et al., 2021). Analysing a customer’s wants, behaviour, and motivation is crucial when considering the customer’s value chain. An organisation and the people it serves will be able to communicate more effectively as a result of this specific circumstance.
Climate
The 5C examination of Apple concludes with a discussion of the climate. Like any other organisation, Apple is impacted by various macroenvironmental forces. For instance, its business in China may be impacted by the trade conflict between the USA and China. On the other hand, Apple may benefit from expansion chances due to the economic sustainability of many industrialised nations. Understanding the external environment enables managers to adapt and strategically plan according to ecological factors outside the business. Table 1 uses a simplified PESTEL framework to determine the macro-environment surrounding the wearable technology industry, specifically the Apple Watch. PESTEL analysis determines the influence of the external macroenvironment on a firm’s competitive position. The PESTEL analysis briefly reviewed several significant macroenvironmental factors, such as the beginning of specific competition laws in the technology industry, the prediction on-set of economic downturns, the dramatic growth in technical advancement, and the predict on-set of the slowing economy.
Table 1: PESTEL Analysis
Company
The culture of innovative products and services is strong at Apple Inc. Employee participation in problem-solving is encouraged, and top management welcomes unique and creative solutions. The organisation’s vision, purpose, and values are supported by its culture. Apple Inc. invests extensively in research and development efforts to maintain its position as the market leader in several product categories. The distribution and promotion methods are supported by significant investments in developing the IT network, marketing, product design, and process optimisation. Due to its high production size, Apple Inc. can take advantage of economies of scale. Large-scale manufacturing strengthens a company’s ability to compete and enables it to manufacture items of higher quality for less money.
Collaborators and Complementors
Apple Inc. has collaborated with several partners, enabling the business to create new product lines and improve the process of creating and distributing products. Apple Inc. is required to carry out thorough value chain activities and carefully consider suppliers’ negotiating power as part of an in-depth collaborator analysis to look into cooperation options. Partners in the upstream and downstream value chains, corporate partners, civic leaders, the government, and other parties participate as collaborators. Apple Inc. may be able to raise the effectiveness of its supply chain and better control over it through economies of scale thanks to the thorough collaborator analysis.
Competitors
Apple competes in many markets against several well-known international brands. Rapid technological advancements have resulted in a decrease in brand loyalty among consumers. In information technology, a lack of innovation is a significant issue that might favour Apple’s rivals. Apple must now concentrate on creating creative items and giving some of its products radically new features. Market research is crucial if individuals are unaware of the company’s main rivals. Some of Apple’s opponents are Amazon, Samsung, IBM, Google, and Microsoft. In terms of product quality scores, when compared to its rivals, Apple comes out on top.
SWOT Analysis
Strength: High quality of Apple products and services in terms of design and performance is the company’s main strength.
Weakness: Apple products and services are priced at a much higher level compared to the competition.
Opportunity: Bigger part of Apple’s vast cash reserves can be invested in research and development initiatives to introduce products and services with innovative features and capabilities.
Threat: The COVID-19 pandemic and the measures taken by many countries in response have adversely affected and could in the future materially adversely impact Apple’s business, results of operations, financial condition, and stock price.
Table 2: SWOT Analysis
Market segmentation analysis
Any frequent watch user would generally be the first prospective Apple Watch user. However, given a product’s unique features, it would be targeted more particularly at early consumers and avid technology users. The Apple Watch is a smartwatch that will appeal to any tech user looking to upgrade or get their first smartwatch (Lee & Baker, 2017). However, any watch user—especially one who already owns an iPhone—might find Apple’s smartwatch intriguing. Given that Apple customers are among the most devoted, this consumer is aware of the Apple brand, appreciates it, and is probably not purchasing his first Apple device. Along with fitness, the majority of sports users across all niches might gain a lot from this watch’s monitoring skills.
Table 3: Market Segmentation Analysis
Target market recommendation
In order to be profitable, Apple has a specific target market on whose interests it concentrates. The Apple Watch uses demographic segmentation, with clients between the ages of 20 and 45 as the centre of the targeting. The target market includes both men and women. Potential Apple Watch customers are either in their final years of college, newlywed couples, have a family with children, or have a family with children and grandkids, depending on their life stage (Hsiao, 2017). Additionally, it is anticipated that these clients have high incomes and can afford to purchase the most recent iterations of the device.
The Apple Watch’s aesthetic appeal will particularly appeal to the premium market; therefore, partnerships with businesses like Hermes are essential to promoting the device to this demographic. Instead, the Nike partnership is related to the requirement to demonstrate the fitness advantages of owning an Apple smartwatch (Statista, 2022b). The Apple Watch’s significant customisation and versatility make them a valuable marketing tool for the intended market.
Recommended Positioning
The Apple Watch should first be seen in the larger watch market, where different prices, designs, materials, and companies ensure that every buyer can select the precise watch he is ready to pay for. The Apple Watch, on the other hand, is a product targeted at the intelligent wearables and tracking devices niche, which has expanded rapidly in recent years, evolving from an eccentricity aimed at those hardened online consumers into a nearly mainstream product with an expanding legion of enthusiasts who either use it as a second watch or are prepared to use it as their primary one.
Conclusion
Apple Watch is a product targeted at the technology watch sub-market, particularly the smart wearables and metrics niche, which has expanded rapidly over the last years. Potential antitrust limitations and expansion possibilities for public-health programs were found via PESTEL analysis. High-resource technology enterprises posed moderate threats from alternatives and new entrants. Apple’s strengths in terms of quality and customer happiness were emphasised by a SWOT analysis, but recent financial difficulties showed its limitations in terms of innovation.
References
Bai, Y., et al. (2021) ‘Comprehensive comparison of Apple Watch and Fitbit monitors in a free-living setting,’ PLoS One, 16(5).
Hsiao, K. L. (2017) ‘What drives smartwatch adoption intention? Comparing Apple and non-Apple watches,’ Library Hi Tech, 35(1), pp. 186-206.
Lee, M. I. N. W. O. O., & Baker, M. A. (2017) ‘Technology, customer satisfaction and service excellence,’ Service Failures and Recovery in Tourism and Hospitality: A Practical Manual, pp. 83-99.
Statista. (2022a) eHealth tracker/smartwatch usage by brand in Australia 2022. Web.
Statista. (2022b) Apple’s revenue worldwide 2004-2021. Web.
Tien, N. H., et al. (2019) ‘Product policy in international marketing comparative analysis between Samsung and Apple,’ International Journal of Research in Marketing Management and Sales, 1(2), pp. 129-133.