education market strategy for apple inc. by team fusion andrew herfurth carey reynolds andrew...
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Andrew Herfurth 1
Education Market Strategy for Apple Inc. By Team Fusion
Andrew HerfurthCarey ReynoldsAndrew SchieweTanasha SmithTanner KelleyThao Nguyen
Andrew Herfurth 2
Roadmap
o Recap oAndrew Herfurth
o Implementation step overviewoCarey Reynolds oAndrew Schiewe
o Implications across organizationoTanasha SmithoTanner KelleyoThao Nguyen
Andrew Herfurth 3
SWOT Analysis
Strength to be exploited ◦(S1): MacOS system prevents most
malware virusesOpportunity to be exploited
◦(O1): Education marketMore effort into education market
◦(S1, O1)
Andrew Herfurth 4
Profit to be Made
1.3 trillion dollars is spent on technology in educational institutions each year
This money is mainly in the form of grants given by the United States government.
Carey Reynolds 6
Overview of Implementation Steps
1) Evaluation of entering into the educational market
2) MarketSegmentation and Target Marketing
3) Seek more Textbook Company Partnerships
4) Educational App Development/Improvement
Carey Reynolds 7
What to doPerform cost-benefit analysis to see
where entering into the education market is most effective
Be more flexible with their pricing to allow for more educational institutions to be able to purchase Apple products
Promotions and advertisements directed towards educational markets◦Personal selling
Carey Reynolds 8
Target Market◦Middle to upper class suburban areas◦Reach out to other demographics to
get more market share
Market Segmentation◦Business to business markets◦Demographic and geographic
segmentation variables primarily
Market Segmentation/ Target Market
Andrew Schiewe 9
Textbook Company Partnerships
Current Partners:◦McGraw Hill◦Pearson Education◦Houghton Mifflin Harcourt
Potential Partners◦Scholastic◦Oxford University Press◦Wiley
Cheaper TextbooksStudies show benefits of technology in
the classroom
10
Educational App Development/Improvement
Current Apps:◦iTunes U◦iBooks
App Customization/ Development services
Contribution incentives for teachers/professors
Note-taking and productivity apps
Andrew Schiewe
Andrew Schiewe 11
Implications of Implementing Apple’s Strategy
Change happens when implementing new plans
Tanasha Smith 13
Research and Development
$10 billion innovation expansion (2013)
Marketing department trainingNew employeesMobile learning Bring your own device programs
Tanasha Smith 14
Quality Management
Level of customer satisfaction that must be maintained in the new apps and environment
Improving quality in every facet of business
Maximize utility of products in education
Tanner Kelley 16
Forecasted Marketing ImplicationsImplication of Business to Business
Market Segmentation:◦ Form of Market Development
Targeting Educational Institutions entails expanding to new users as well as new uses of current products.
Is expanding to the educational market profitable? ◦ Apple will need to expand sales by
demonstrating new uses for its products◦ To expand sales Apple must use personal
selling Product has high value, there are few customers, and
buyers are geographically concentrated.
Tanner Kelley 17
Cost Implications of Personal Selling
◦Expanding Apple’s market to include educational institutions requires a larger sales force Leads to increased costs for salaries,
wages & commissions Apple sales force typically paid between
$15 and $30 Recently, Apple announced raising employees
wages by as much as 25%.
Tanner Kelley 18
Human Resource Implications of Increasing Sales ForceExpanding the Sales Force requires:
◦Average costs of hiring new employees is about $4,000 (University of California of Berkeley)
◦Additional employee training: Extensive training to become knowledgeable
on Apple products Increased cost in instructor-led classes for the
Apple Certification Exam
◦Recruitment: Costs of recruitment include sourcing costs
(i.e. advertising and internet postings)
Thao Nguyen 20
Forecasting As of March, 2013, Sales will be $41 - $43 billion $10 billion on innovation, expansion in 2013, said
Chief Financial Officer Peter Oppenheimer Apple's iPads education sales double, two iPads for
every Mac ◦ McAllen, Texas, public school officials plan to
distribute 25,000 iPads over the next few years
$20 million spent for the cost of the iPads, Wi-Fi network and training needed
◦ San Diego distributes 26,000 iPads to students
◦ Chicago public schools have around 20,000 iPads.
“School iPads & tablets development, Fall 2012” Source: http://www.ipadinschools.com/
Thao Nguyen 21
Source: http://www.glassdoor.com/GD/Salary/Apple-Salaries-E1138.htm?filter.jobTitleFTS=sale
Thao Nguyen 22
Budget Quarterly
Hiring cost $4,000
Employees
$20/hour (200 employees)
$20/hour * 12hour * 80 days/quarter * 200 employees $3,840,000
R&D (6% of sale)
March sale = $42 billion 6% * $42 billion
$2,520,000,00
0
Investment in retail stores
$1 billion in 2013 $1 billion/4 $250,000,000
Total budget
$2,773,844,00
0
Thao Nguyen 24
DuPont Analysis
As of March 29, 2013 (forecasted) 8%
As of June 29, 2013 (forecasted) 9%
This ROE is still out of rank of 15-20% desirable
Thao Nguyen 25
Source: http://seekingalpha.com/article/1160191-peeling-apple-a-long-term-roe-analysis
Andrew Herfurth 26
ConclusionImplementation steps Evaluation of entering into the educational
market Market Segmentation and Target Marketing Seek more Textbook Company Partnerships Educational App Development/ImprovementImplications across the organization Research and Development Quality management Implications in marketing, HR, and costs Forecast
Andrew Herfurth 28
Works Cited http://work.chron.com/average-cost-hire-new-employ
ee-13262.html http://online.wsj.com/article/SB100014240527023047
65304577478903919636114.html http://www.apple.com/jobs/us/ http://www.ramco.com/blog/the-right-way-to-erp-impl
ementation
http://www.forbes.com/fdc/welcome_mjx.shtml http://www.ipadinschools.com/ http://
appleinsider.com/articles/13/01/24/apple-to-spend-10-billion-on-innovation-expansion-in-2013
http://www.cnn.com/2012/01/23/tech/innovation/ipad-solid-education-tool
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