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Shinee Jayatilaka

on 25 May 2015

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Transcript of iPhone

By: Nishi, Shinee, Chushuang, Nael
Apple Inc.






In 2014, 169,219 thousand iPhones were sold

$101,991 million revenue made by iPhone
Widely recognized product

Brand and positioning

product life cycle
Research and development Expense
-$10 billion
-35% growth on R&D expense from 2014 to 2013

Selling, general and administrative expense
- $13 billion
- $12 billion spent in SG&A
in 2014
Focuses on selling high quality, high priced products
Priority to profits over market share
Does not offer discounts often
Skimming pricing strategy
iPhone holds the maximum percentage of sales at Apple
--> first quarter of 2015, iPhone sales reached over $75 billion (USD)
Expand the retail shops

Broaden iPhone recognition
Apple spends the least they could on advertisements
--> network providers does it for them

Media attention due to their unique distribution strategy.

Free publicity.

Located in Cupertino, California, USA

Manufacturers located in China (Foxconn)

Sells products through their website, teams up with network providers, websites such as amazon, and eBay.
- A strong upside growth
Increase iPhones' sales
-Raise revenue & provide better

Enlarge iPhones' penetration
-Enhance Apple's brand value
This marketing plan
Establish in 1976 by Steve Job

The most valuable brand in 2015
$741.8 billion market cap

92,600 employees

Market leader

Large product range

Positioned very high in
consumer's minds
Products have non-user replaceable battery

Relatively high prices

New innovations through developing technology
e.g. the Apple Watch.

Increased environmental sustainability
Increased competitors
- e.g. Samsung, HTC, Nokia, Blackberry, etc.
Jail breaking
- gives third party unauthorized access and control
- can be downloaded with which hackers can access personal location and details
Wage disparity ($1.50 per hour in Chinese factory vs. $7.50 per hour for minimum wage worker in U.S.) (Smith 2013)
Further funding for company projects (Chakrabortty 2012)

Apple's influence on society
- helps build a loyal customer base

- personal information required by iPhone to create iCloud account

The effect of the 2009 GFC

Loyal customers contribute to Apple's enduring financial success by dutifully purchasing new products as they are released
Consistent investment into R&D gives Apple a great technological advantage.

Apple increased it's finance for R&D from $3.4 billion in 2012 to $6 billion in 2014.
The Australian Financial review investigated Apple and how it the company pays only $193 million in tax in Australia on $27 billion in revenue (Ockenden 2014).
The Australian government has implemented strict regulations to protect employees, and gain more from tax
Improve iPhone 6 and 6 plus

Create the new iPhone 7 line
Competitor analysis
iPhones' competitors: Samsung, HTC etc.

$39.3 million
$2.3 million
Customer/client analysis

Younger children (<12 years old)

Teenagers (12-18 years old)

Adults (20-50 years old)

Andersen, B 2009, 'Australian admits creating first iPhone virus', ABC 10 November. Available from: <http://www.abc.net.au/news/2009-11-09/australian-admits-creating-first-iphone-virus/1135474>. [5 March 2015].

Apple Inc. 2014, Annual Report. Available from: <http://investor.apple.com/secfiling.cfm?filingid=1193125-14-383437&cik>. [14 May 2015].

Apple Inc. 2014, iPhone 6 Environmental Report. Available from: <https://www.apple.com/environment/reports/docs/iPhone6_PER_Sept2014.pdf>. [26 April 2015].

Apple Inc. 2014, iPhone 6 Plus Environmental Report. Available from: <https://www.apple.com/anzsea/environment/reports/docs/iPhone6Plus_PER_Sept2014.pdf>. [26 April 2015].

Apple Inc. 2014, Supplier Responsibility 2014 Progress Report. Available from: <https://www.apple.com/supplier-responsibility/pdf/Apple_SR_2014_Progress_Report.pdf>. [21 May 2015].

'Apple's iPhone: a history in pictures', The Telegraph. Available from: <http://www.telegraph.co.uk/technology/apple/iphone/5477324/Apples-iPhone-a-history-in-pictures.html?frame=1419283>. [20 May 2015].

Apple Press Info 2014, Press Releases. Available from: <https://www.apple.com/pr/library/2014/>. [20 May 2015].

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Baig, E 2015, ‘Report: iPhone gaining popularity across Europe at Androids expense’, Americas markets. USA Today, 6 May. Available from: <http://americasmarkets.usatoday.com/2015/05/06/report-iphone-gaining-popularity-across-europe-at-androids-expense/>. [11 May 2015].

Bajarin, T 2015, ‘Apple’s iPhone Growth opportunities’, Techpinions, 1 May. Available from: <https://techpinions.com/apples-iphone-growth-opportunities/39966>. [12 May 2015].

Bilton, R 2014, 'Apple 'failing to protect Chinese factory workers', BBC 18 December. Available from: <http://www.bbc.com/news/business-30532463>. [21 May 2015].

Caulfield, B 2009, 'Apple kills recession', Forbes 19 October. Available from: <http://www.forbes.com/2009/10/19/stock-price-earnings-technology-enterprise-apple.html>. [26 April 2015].

Chakrabortty, A 2012, 'Apple and the folly of outsourced manufacturing', The Sydney Morning Herald 25 April. Available from: <http://www.smh.com.au/technology/technology-news/apple-and-the-folly-of-outsourced-manufacturing-20120424-1xj2x.html>. [26 April 2015].

Chen, B 2014, 'BBC documentary shows harsh conditions for workers in iPhone factories', The New York Times 19 December. Available from: <http://bits.blogs.nytimes.com/2014/12/19/bbc-documentary-shows-harsh-conditions-for-workers-in-iphone-factories/?_r=1>. [21 May 2015].

Chief Marketing Officer Council 2015, Mobile Marketing Facts & Statistics. Available from: <http://www.cmocouncil.org/facts-stats-categories.php?view=all&category=mobile-marketing>. [5 March 2015].

Chowdhry, A 2015, 'Apple surpassed Samsung as global phone market leader, says report', Forbes 4 March. Available from: <http://www.forbes.com/sites/amitchowdhry/2015/03/04/apple-passes-samsung/>. [5 March 2015].

Dilger, D 2015, 'Bank of America promotes iPhone 6 in new TV ads for Apple Pay', Apple Insider 3 January. Available from: <http://appleinsider.com/articles/15/01/03/bank-of-america-promotes-iphone-6-in-new-tv-ads-for-apple-pay>. [20 May 2015].

Duhigg, C and Bradsher, K 2012, 'How the U.S. lost out on iPhone work', The New York Times 21 January. Available from: <http://www.nytimes.com/2012/01/22/business/apple-america-and-a-squeezed-middle-class.html?_r=0>. [26 April 2015].

Edwards, J 2014, 'Apple is losing the war to Android', Business Insider Australia 31 May. Available from: <http://www.businessinsider.com.au/iphone-v-android-market-share-2014-5>. [5 March 2015].

Epstein, Z 2014, ‘Study: iPhone owners have ‘blind loyalty’ and will buy anything Apple makes’, BGR, 13 Feb. Available from: <http://bgr.com/2014/02/13/apple-loyalty-study-iphone/>. [11 May 2015].

Forbes 2015, 'The world’s most valuable brands', Forbes. Available from: <http://www.forbes.com/companies/apple/>. [14 May 2015].

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Griswold, A 2015, 'The iPhone 6 just shattered Apple's own sales records', Slate 27 January. Available from: <http://www.slate.com/blogs/moneybox/2015/01/27/iphone_6_shatters_sales_records_apple_has_a_great_first_quarter_in_2015.html>. [20 May 2015].

Hughes, N 2013, 'Apple's research & development costs ballooned 32% in 2013 to $4.5B', Apple Insider 30 October. Available from: <http://appleinsider.com/articles/13/10/30/apples-research-development-costs-ballooned-32-in-2013-to-45b>. [26 April 2015].

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Musil, S 2013, 'Hackers claim to have defeated Apple's Touch ID print sensor', Cnet 2 September. Available from: <http://www.cnet.com/news/hackers-claim-to-have-defeated-apples-touch-id-print-sensor/>. [5 March 2015].

Nielson, S 2014, 'Apple's premium pricing strategy and product differentiation', Yahoo 7 February. Available from: <https://www.yahoo.com/tech/s/apple-premium-pricing-strategy-product-191247308.html>. [20 May 2015].

Ockenden, W 2014, 'Apple pays $193m tax in Australia on $27b revenue as Federal Government vows to capture lost taxes', ABC 7 March. Available from: <http://www.abc.net.au/news/2014-03-06/tax-expert-explains-how-apple-pays-193m-tax-on-27b-revenue/5303426>. [26 April 2015].

Revilla, A 2015, ‘Apple converts many Android users to iOS with larger iPhones in Europe and China’, Digital trends, 8 May. Available from: <http://www.digitaltrends.com/mobile/android-ios-market-share-europe-news/>. [9 May 2015].

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Silva, PV 2015, ‘Apple Brewing Something Massive Plus New iPhone 7 renders Look Stunning’, International Business Times, 11 May. Available from: <http://www.ibtimes.com/apple-brewing-something-massive-plus-new-iphone-7-renders-look-stunning-1913738>. [12 May 2015].

Smith, K 2013, 'Chinese workers making iPhones work 11-hour shifts, 6 days a week, for $1.50 per hour', Business Insider Australia 30 July. Available from: <http://www.businessinsider.com.au/china-labor-watch-apple-iphone-workers-2013-7>. [26 April 2015].

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Villapaz, L 2014, 'Apple spent $6 billion on R&D, up nearly one hundred percent since 2012', International Business Times 28 October. Available from: <http://www.ibtimes.com/apple-spent-6-billion-rd-nearly-100-percent-2012-1714782>. [26 April 2015].

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Apple has displayed corporate social responsibility through environmental awareness
Avoiding harmful substances in products
Reducing greenhouse gas emissions
Increasing sustainability
(Apple 2014)
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