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The Product Life Cycle of the iPod Classic

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Jonatan Kamenetsky

on 24 September 2013

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Transcript of The Product Life Cycle of the iPod Classic

Introduction
Sales ($/ Volume)
Time
The Product Life Cycle of Apple's iPod Classic
By: Jonatan Kamenetsky
-In early September of 2001, Apple began hyping the iPod’s
release (which was still a secret from the press). The hype was
necessary to release that Apple would make a major announcement
on October 3rd 2001.

-Rumors immediately started up about an updated version of apple's Newton or a PVR, but no site predicted that Apple would release an MP3 player.

-Advertisements came at lots through bill boards, commercials, and word of mouth. It was highly expensive to market as their was need for professional ad developers, designers , marketers, and more.

-On launch, the fans and other audience were shocked by the product. Unfortunately, the product's importance to the music industry was
not identified until much later and so, other than "trend-setters", the
product was not purchased greatly.

-The iPod was also very expensive, US$399, in order to pay
for heavy marketing and start up costs such as
machinery, product design and personnel.



Growth, 3rd Generation IPod
-In April 2003, Apple had invented the 3rd generation of the
iPod Classic and the iTunes Music Store.

-With the 3rd generation of the iPod Classic, Apple decided to
discontinue the use of their old (lithium polymer) batteries in
1st and 2nd generation iPods to the (lithium-ion) batteries which
would come to power all future iPods.

-The iTunes Music Store had given the ability to users to buy
music and listen to music through the Music Store. Now, the
iPod had a fully legal supply of music which made it easier for
Apple to cut the price of the iPod now that it had another
revenues stream.


-At the start of the 4th generation iPod, HP decided they wanted in on the
iPod "game". They did not want to invest in creating their own player and reached an agreement with Apple to re market the iPod under the HP brand and include iTunes on all consumer computers HP sold. The new version also meant a price drop across the board for all iPods which resulted in increase sales in other IPod generations.

-The agreement came into plan in 2004 with the HP and iPod line. The HP branding got the iPod into many retailers that did not sell Apple products which resulted in a large increase in number of iPods sold.

-The iPod was a huge hit. Apple had sold millions of devices and was making lots of profit. In addition, BMW outfitted all of its vehicles with an iPod interface that allowed BMW owners to play their music over the BMW’s sound system and control their iPod via steering wheel controls.

-At this point, iPod was having heavy and expensive ads including :
word of mouth, through other brands (HP and BMW), and many of their own commercials and billboards. An example of this is an article that featured the iPod and Steve Jobs on the front cover and had a short story on the history of the iPod and Apple’s announcement of the fourth generation iPod. Apple
also had a commercial with celebrity rapper, Eminem using the
iPod silhouettes.

Growth, 4th Generation IPod
Maturity
-In October 2005, the fifth generation iPod was created and was as significant to Apple as creating the iTunes Music Store was in 2002. The fifth generation iPod was the first iPod to be available in a black option as apposed to the "Signature iPod White", and marked the second full redesign of the iPod's aesthetic. The 5th generation iPod is also capable of playing videos purchased online.

-At this point, the research gathered by Apple in the growth stage had started paying off as Apple had been able to reach out and obtain information of the exact features that consumers would like for the 5th generation iPod. Allowing Apple to create a perfect iPod for their users resulting in an increase sales/profit and product stability.

-The video-enabled iPod was equipped with more and more features, making the device more like a PDA than a pure music player. It was equipped with calendar, address book, and also feature a suite of games, a screen saver, and a PIN screen.

-Despite that this product was quite expensive, started at $249 for 30 GB, the product was already known for its good quality and was bought with little prompting from ads. The ipod silhouettes commericals still continued, but were not as heavy as in the growth stage.

-Sales did still increase but started to even out as either consumers
already had the 5th generation iPod, had an earlier generation, or
had a different type of iPod (nano, shuffle).
Decline
-The iPod classic series had started slowing down in sales. This was because it had been barely changing at all. Moreover, many people had an iPod classic and therefore, there was little people left that actually had need for it and were buying the product.

-Apple's other products started taking over the music industry (nano, shuffle, and soon touch) which left the classic with little advertising priorty.

-At this point, Apple was also developing the iPhone touch. Why have a standard music player when you could get a touch phone with way more features the even the PDA feeling the 5th generation iPod had? And so, people basically stopped buying the iPod classic
series almost entirely.
Decision-Point
-At the decline of the iPod classic, the iPhone and iPod touch became introduced. Although little money was made of the classic, it didn't mean business was over for Apple. The touch products became a large success...

-After the touch products, Apple had designed a 6th generation iPod classic. Though, this had little updates from the 5th generation and was still out sold by Apple's other products. The classic had basically become the old man of the iPod line. It was not touch, not flash based, did not offer support for the App Store, and was much heavier than other iPod devices. The only thing it had to offer was capacity which does not sell well when compared with the features of any of Apple's other devices.


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