opportunity for this marketing plan marketing essay
TRANSCRIPT
Opportunity For This Marketing Plan Marketing EssayFor assignment help please contact at [email protected] and
In New Zealand, the original Apple Store is located in New Market. The
Apple Store is planning in open Apple stores in more key locations. This
marketing plan aims to present the objectives, strategies, tactics &
marketing action plan for Apple Inc. for promoting the new Mini iPhone
product in New Zealand.
3. Area of interest
The area of interest for this assignment is a product - Smartphone/iPhone
4. Details of Area of Interest
There is a substantial increase in iPhone sales in the global market. The
iPhone package often comes with the phone, earphone with remote and
microphone, dock connector to USB cable, and USB power adapter and
documentation. iPhone comes with different memory size, including 16 GB,
32 GB and 64 GB, which are sold at different prices. iPhone also have a
number of overseas manufacturing plants in order to ensure low
manufacturing costs.
iPhone is first mobile phone that is touch screen without keyboard. It just
uses our finger to control the mobile phone that is substantially different
with the traditional mobile phone. iPhone can support many languages such
as English, Chinese, French, German, Arabic and Japanese and so on. The
company Apple has established strong global brand name and has grown
into one of the largest mobile and tablet producers in the world.
5. Opportunity for this marketing plan
There is an opportunity to develop a mini iPhone with more features and
lower prices for young people, such as more colours, stronger music
functions and internet functions.
The reason for this opportunity is firstly that the sales of iPhone 5 are
expected to drop significantly in 2013, as can be seen from the figure below,
due to changes in customer needs and increasing competition from
competitors such as Samsung.
Secondly, the newly announced iPhone 5 does not have significant
improvement as compared with the previous iPhones. Customers are
complaining with the lack of innovation of Apple and have started to seek
different brand. The style and look of iPhone 5 did not change much from
the previous versions and the content, such as software and functions, of
iPhone 5 did not improve from iPhone 4 or IPone 4S substantially.
Also, iPhone is priced in the higher range due to its popularity and unique
design. The following tables summarise the prices for iPhone5 and prices of
competing products from other brands. The prices are collected from
Vodafone as of 30 October 2012. The high price of iPhone 5 is not
affordable for some customer groups, such as young people and students.
The price of iPhone 5 is almost as expensive as an average laptop in the
market. Those customer groups, however, are more likely to regularly
change their mobile and to try out new technology and products. Based on
these reasons, there are market opportunities for Mini iPhone, which are
cheaper and designed to satisfy the needs of young people.
Brands
Prices
iPhone5 32 GB
$1199
Sony Xperia U
$299
Nokia Lumia
$399
HTC One X 32GB
$999
Sumsung Galaxy S III 32 GB
$1049
6. Objectives
6.1 Marketing objectives
The overall objective of the marketing programs aims to successfully design
and promote the new Mini iPhone to young people who purchases phones
more frequently and have less disposable income to purchase expensive
iPhones.
6.1.1 Product objective
The product objective is to design new packages and features of Mini
iPhone product for young people from 1 January 2013 to 31 December
2013.
6.1.2 Price objective
Price objective is to provide competitive pricing, which covers the costs and
attracts young people by 31 May 2013.
6.1.3 Distribution objective
Distribution objective is to expand traditional Apple distribution channels,
such as Apple store and electronic shops into more channels, such as
supermarket, department stores, and fashion stores by 31 May 2013.
6.1.4 Promotion objective
Promotion objective is effectively increase brand awareness and promote
the sales of Mini iPhone through establishing an IMC (integrated marketing
communication) campaign called "mini but mighty" from 1 January 2013 to
31 December 2013.
6.1.5 Other marketing objectives
Another marketing objective is to increase market share of Mini iPhone by
20% by the end of 2013. Market share is an important issue to evaluate the
effectiveness of this marketing plan because it reflects the number of
customers who have switched to or maintained to be a customer of Apple
after the launch of Mini iPhone.
6.2 Financial objectives
The financial objective is to achieve a sale of $40 million from 1 January
2013 to 31 December 2013 in the New Zealand market. Sales are
sometimes argued to be a rather weak measure for marketing effectiveness
because there are a large number of external and internal factors that can
affect the level of sales (Aaker, 2009). It is difficult to pinpoint to causes for
changes in sales to marketing efforts. However, the level of sales is still one
of the post important measures to capture the financial performance of the
company.
In addition to sales, Return on Investment (ROI) can also be used as a
financial measure for Apple. ROI can be worked out using the following
formula.
Source: BUSINESS CASE ANALYSIS (2012)
In particular, the financial objective for Apple should be to achieve more
than 20% ROI from 1 January 2013 to 31 December 2013. It is important for
Apple to ensure the gains from developing and promoting Mini iPhone
covers the costs of doing so.
7. Strategy
7.1 The product strategy
The product strategy is to reduce complicated functions for businesses and
design more colours, different material packaging, and features for young
people, such as stronger music system and internet connection programs.
The product strategy is product differentiation. Kotler and Keller (2012)
claim that products can be differentiated in different forms, including the
size, shape, or physical structure of a product. The aim of the product
differentiation strategy is to be different from the products offered by the
competitors and be more attractive to customers. Currently, Apple needs to
address customers' concern that iPhone has got too many features with too
high a price. Mini iPhone is expected to get rid of the redundant features
through the compact design. Another reason for adding more colours and
phone accessories is to be more appealing to the young consumers. As
discussed before, young people are an important group of high-tech chaser
who change cell phones very frequently and are easy to be attracted by
fashionable elements in cell phones. Therefore, the product strategy is
expected to resolve the current concern over complicated functions and
attract more young customers than before.
7.2 Pricing strategies
The pricing strategy that Mini iPhone will pursue is the price skimming
strategy (Kotler & Keller, 2012). Many high-tech products adopt the market-
skimming pricing because technology sets up the environment for this price
strategy. A cell phone manufacturer comes out with a new cell phone model
every 8 to 10 months (Bovay, 2012). This means the older model is soon
replaced by new ones, and they have to cut prices to attract buyers. In
contrast, the new model is equipped with the best technology and is able to
be sold at a better price. For Mini iPhone, the starting price would not be as
high as a standard iPhone 4S or iPhone 5 because it has got less features. It
is also the objective to design and market a more affordable model of
iPhone. Mini iPhone is designed for young customers with less income but is
interested in changing their phones more frequently. Apple can attract
young people with the competitive pricing and can make more profits in the
future by producing more Mini iPhone accessories. However, it will be more
expensive than competitors' products with similar features because the
Apple platform is irreplaceable. As time goes by, Apple can consider price
reduction to target the majority audience.
7.3 Distribution strategies
Apple should continue to use the selective distribution strategy that it
currently implements in New Zealand. Selective distribution strategy means
that Apple will rely on a number of intermediaries to carry and sell a
particular product (Kotler & Keller, 2012). These intermediaries include
Apple stores, electronic shops, and telecommunication stores. The internet
should also be considered as it is a relatively cheap distribution channel to
reach a large number of potential customers. Compared with exclusive
distribution, selective distribution is more flexible for Apple. It allows Mini
iPhone to gain adequate market coverage with more control and less cost
than intensive distribution (Kotler & Keller, 2012). If the initial market
response for Mini iPhone is good, Apple could also consider widening the
distribution channel by selling Mini IPhone in major shopping malls or
department stores.
7.4 Promotion strategies
The promotion strategy for Apple will be changed to develop an IMC
(integrated marketing communication) campaign to market Mini iPhone. In
particular, IMC allows a brand to market its products and services through
multi-media and channels in order to effectively reach target
customers(Kerin, Hartley, Berkowitz, & Rudelius, 2009). Traditional mass
marketing channels, such as television advertising, are not "mass" anymore
because the fast development of technology and globalisation have changed
people's lifestyles, such as where to get information. A lot of people today
do not watch TV regularly but prefer to search information online. It is not
possible to reach all target customers through a single marketing media or
channel. In the case of Apple, the target customers for Mini iPhone include
young people aged between 20 and 30 years old. The main message for the
IMC for Mini iPhone is "mini but mighty", which indicates that Mini iPhone
can have so much features and functions than it looks. The detailed tactics
for each of the channel will be discussed in greater details in the tactic
section. In addition, Apple needs to adopt a pull strategy, which directs the
promotional mix at consumers directly to encourage them to ask the retailer
for a product (Kerin et al., 2009). This is customer demand for the product
is the most important driving force for the success of Apple.
8. Tactics
8.1 Product tactics
The product tactics for Mini iPhoneinclude the following:
1. The package design will be changed to use less expensive materials and
are easily changeable to multicolour cases and other cases. An example of
colourful Mini iPhone is shown below. Main colours to be used should
include the rainbow colours - red, orange, yellow, green, blue, indigo, and
violet. The purpose is to give consumers more choice of colour to customise
their life. In order to be innovative and focus on particular interest of young
people, there can be frequently updated special edition cases for Mini
iPhone, such as cases designed for Rugby World Cup or cases designed
using themes from popular movies.
2. The phone will remove complex business functions and add more
functions for young people. These include stronger music player and more
games. For example, Mini iPhone can have built in game pad to allow young
people to have better gaming experiences. An example of the design is
shown on the right.
3. Instead of giving traditional iPhone earphone in the package, Mini iPhone
can give customers wireless earphones that are colourful and unique. These
wireless earphones are estimated to cost less than $20 to manufacture.
4. The product size for Mini iPhone should be slightly smaller than iPhone 5.
The following picture shows the size of current iPhone5, which is 123.8 mm
x 58.6 mm. The designed size for Mini iPhone should be about 100mm x
58.6mm.
8.2 Price tactics:
As stated in 7.2, the general pricing strategy is price skimming strategy that
starts with a relatively high price and gradually lowers the price down.
However, it is important to determine what the starting price should be.
Since Mini iPhone is a compact version of iPhone, the reduced function and
production costs should be reflected in the pricing. At the moment, the
standard prices for different model specifications of iPhone 4S and iPhone 5
are listed below. These prices are official prices offered through Apple New
Zealand online store (Apple Store, 2012).
Different Prices between Iphone 5,4 and Mini Iphone
16 GB
32 GB
64GB
iPhone 5
$1029
$1,199
$1,349
iPhone 4S
$788
$945
$998
Mini iPhone
$498
$598
$698
Since Mini iPhone keep two thirds of the functions of standard iPhone and it
is made of cheaper materials, the starting price for Mini iPhone should be
lower than the current prices for iPhone 5 and iPhone 4S. This will attract
the customer because they would value the trade-off between features and
prices. Kotler and Keller (2012) point out that many products are offered
with different features that supplement their basic function. It is important
to consider how many people want the extra feature and how much it would
take to introduce additional features in the market. The features taken off
are reflected in the reduced price shown in the table. This price is very
competitive as Apple has never offered mobile phones at this affordable
price. It is now more affordable for the vast majority of consumers to own
their apple product without too much financial burden.
This price range is very attractive considering the brand equity offered by
Apple and the supplementary services (e.g. AppStore) that mobile phone
users cannot get from anywhere else. The table below is a summary of the
current prices of the popular mobile phone models offered by Apple's
competitors as listed on PriceSpy (2012).
Comaparision prices of phones between companies
HTC
Samsung
Nokia
Sony
HTC One 32 GB
$595
GT -i9300 Galaxy SIII 16 GB
$665
Lumia 800
$339
Sony Xperia U
$247
HTC One S
$535
GT -i9100 Galaxy S II
$475
Lumia 900
$525
Sony Xperia S
$465
HTC One 16 GB
$595
GT-N7100 Galaxy Note II 16 GB
$579
Lumia 610
$232.98
Sony Xperia P
$386
HTC One XL
814.95
GT-i9300 Galaxy S III 32GB
$797.99
N9 16 GB
$359
Sony Xperia Acro S
$649
HTC Desire HD
$439
GT-S5570 Galaxy Mini
$97
808 PureView
$799
Sony Xperia SL
$563
HTC Evo 3D
$529
GT-i8160 Galaxy Ace II
$361
Nokia N8
$485
Sony Xperia Go
$349
HTC Evo Design
$499
GT-i9070 Galaxy S Advance
$413
Nokia E7
$519
Sony Xperia TX
$769
Compared with competitors' prices for different mobile phone models, Mini
iPhone is at the average level of the mobile phone prices. This price is
expected to remain for a while to attract Apple fans and early adopters.
After 5 months of the introduction of Mini iPhone, Apple should lower the
price of Mini iPhone according to the price skimming strategy. The first
price reduction can be $60 to $100 where the largest reduction should take
place for the highest level model of the 64 GB model. The reason is to
encourage customers to purchase more of the best models in the Mini
iPhone range as the profit margin should be higher for the highest model.
The second price reduction can be a further $100 decrease to make it even
more appealing to the average consumers in New Zealand with average
purchasing power. Also, the second price reduction is likely to coincide with
Apple's new mobile phone model release. As many high-tech products do,
the Mini iPhone product should have been an older model by then and price
should be reduced to stimulate demand.
This process of price changes for Mini iPhone is summarised in the table
below.
Time
Mini iPhone (16GB)
Mini iPhone (32GB)
Mini iPhone (64GB)
Initial introduction
$498
$598
$698
5 months after the introduction
$438
$518
$598
The second price reduction (about 12-18 months after the initial
introduction)
$338
$418
$498
8.3 Distribution tactics:
As mention before, the mixed distribution strategy has been using by apple
in New Zealand for some time.Telecom and Vodafone have play a role such
as intermediaries who are specialised in providing telecommunication
services. It also authorises a number of department stores and specialty
stores to sell the iPhone products such as Dick Smith, Noel Leeming, the
Warehouse, and Harvey Norman. These established distribution channels
are readily to be used by Mini iPhone. New information about iPhone
products should always been given to those distrubutors in advance. It is
important to continue the relationship with these existing distributors
because they have been the selected distributors for Apple for many years.
They have accumulated valuable experience in introducing and selling the
iPhone products to the customers. They are always in the best position to
sell Mini iPhone as long as Apple provides those informations to them in
advance so that they have time to get prepared during the launch day of
iPhone Mini.
In addition, Apple should make better use of other distribution channels to
sell Mini iPhone as well. Consumers are more willing to shop online for Mini
iPhone if it is available in their countries and regions. Apple could consider
offering Mini iPhone through its online store in New Zealand. It could also
include free delivery services to better encourage online purchase of Mini
iPhone. However, this plan is subject to the condition that Apple can
negotiate good delivery terms with logistic companies or with Post NZ.
Given the influence of Apple, this should not be too difficult. What Apply
should consider is whether the cost of delivery is matched by the increase in
demand and sales for the new product, Mini iPhone.
8.4 Promotion tactics:
8.4.1 Advertising tactics for brochures
Newspaper is not selected to promote Mini iPhone because few young
people read newspapers today. Brochures will be used to promote Mini
iPhone because brochures sent out at the point of purchase not only sent
information about Mini iPhone to customers but also stimulate purchase
decisions.
The brochure design should be creative, distinctive and informational. This
means that the brochure needs to have distinctive Apple logo, have creative
design, and contains sufficient information about Mini iPhone. The following
pictures show a sample brochure for Mini iPhone. The brochure takes a
form of a Mini iPhone and shows information about key features and
characteristics of Mini iPhone, such as the multiple colour choices and the
cheaper prices.
The brochure should be about 166mm high x 65mm wide or slightly smaller
in order to have sufficient spaces for the information and be close to the
size of Mini iPhone. It should also be printed 2 sides because the brochure if
likely to be folded. Colour print should be used in order to promote the
fashionable, young, and colourful design of Mini iPhone.
Vistaprint can be a potential supplier to print the brochures. The cost of
printing brochures at Vistaprint is shown in the table below. The more
orders to placed the more cheaper price they got, therefore, Apple should
print 100,000 brochures first, which cost NZ$30,000.
Source: Vistaprint (2012)
The brochures will be distributed to partners, such as electronic shops (E.g.
JB Hifi, Dick Smith), Apple stores, telecommunication stores (E.g. Vodafone,
Telecom), and other retailing stores for Apple. These brochures are given
freely to customers who are interested in Mini iPhone. These customers are
more likely to be potential customers because they are interested in taking
the brochure and they are customers of related shops, such as electronic
shops and telecommunication shops.
8.4.2 Advertising tactics for radio
Radio advertising for Mini iPhone should be on popular radio programs
such as Mai FM 88.6 music channel. The station of the channel is located in
Ponsonby Auckland. The channel broadcast popular music, has a number of
popular shows or programs, and holds special events with super stars or in
local community. Mai FM is selected because it reaches a large proportion
of young people, who often listen to the channel when they are travelling. In
particular, Mai FM reaches 289,642 people, aged below 35, every
month(Mediaworks, 2012). Good coverage among New Zealand also
became one of the main key why this channel had been selcted.
The advertisement of Mini iPhone should be presented every weekday
(Monday to Friday) during the morning programs, including Mai Morning
(6am - 10am) and K-Lee (10am - midday). Such time is the best time to
dvertised the products as most people will be listening to the ratio while
driving or while taking public transportations. The advertisement will firstly
to broadcasted for 1 months (four weeks) before the evaluation of the
effectiveness be carried out. The message in Radio is not visual and
customers are not able to see the colourful cases. The advertisement needs
to include statement of key features and use sense of humour to make the
advertisement more memorable.
The creative development of the radio advertisement can cost about $1,750
and the media cost at Mai FM can cost from $3,000 to $6,000 a week
(Mediaworks, 2012). Therefore, the total cost for Apple to advertise Mini
iPhone on Mai FM can be from $13,750 to $25,750 (Mediaworks, 2012).
8.4.3 Advertising tactics for TV
Television advertising for Mini iPhone should focus on advertising during
and after TV shows that are popular among young people, such as
American's Next Top Model and Music TVs. Therefore, Apple should
advertise on TV Four, which is a newly launched channel that provides
young people with interesting shows, such as American's Next Top Model,
Beauty and the Geek, Survivor, and American Horror Story. This TV station
is chosen also because it has a good coverage of all major cities in New
Zealand. TV Four reaches more than 700,000 audiences mainly aged
between 18 and 49 years old every month(Mediaworks, 2012). These are
the target customers for Apple who are interested in new and fun stuff and
have a taste for fashion. Therefore, the advertisement should have the
message as "fashionable, new, and innovative" and highlight the interesting
features of Mini iPhone.
The advertisement should be broadcast after and in between shows, such as
American's next top model and Beauty and the Geek. This ensures the
advertisement reaches target audiences. The approximate time for such
programs and shows are at 7:30pm to 9pm. The advertisement should also
be presented on weekdays because it is likely that young people will not be
watching TV on weekends but are busy with other social events.
The commercial production costs can be at least $2,500 and the cost of
advertising on New Zealand TV channels on weekdays at the time selected
above is more than $10,000 per day(TVNZ, 2012). It is planned for Apple to
advertise on TV for about four weeks, which generates a total TV
advertising cost of at least $202,500.
8.4.4 Advertising tactics for the internet
Internet and social networks are popular and welcomed by young people.
This is an opportunity for Apple to win over these customers. For example,
Mini iPhone can advertise through the internet and social network websites
such as Facebook and Twitter. There are more than 835 million Facebook
users in the world in 2012 (Internet World Stats, 2012). It does not cost
much to set up social network pages and answer customer enquiries. But it
does create a good communication channel between the company and its
customers.
Apple Facebook has 1.63 million fans, as can be seen from the picture
above, which is a great source for Apple to market its new Mini iPhone
product(facebook, 2012). However, the current facebook page of Apple only
presents pictures of iPhone products and allows customers to download
Apple wallpapers for their computer. There are no updates of information
on company and products and little interactions are made between
customers and the company. Apple should utilise the communication
opportunity created by facebook and collect valuable feedback from
customers and promote the new product to them effectively.
8.4.5 Sales promotion tactics
In order to design an interesting and unique promotion for Mini iPhone and
combine different channels together, Apple can give a prize (a brand new
Mini iPhone with a limited edition case) for a competition, which involves
customers sharing the best photos with their Apple products on their
facebook page. The competition aims to stimulate the interests of young
people and potential customers and promote Mini iPhone to loyal Apple
customers through the Internet world. The winner's photos can also be
shown on TV advertisement or Apple website with their permission.
Examples of such photos are shown below. Apple should provide 50 prizes,
which costs about $1,000 each. There can also be administration costs for
this promotion. The total cost of sales promotion for Apple is about $51,000.
8.4.6 Public relations tactics
Apple can sponsor a program that provides discounted price Mini iPhone to
University students. University students can purchase new Mini iPhone at a
slightly lower price with their proven of enrolment. This sponsorship is to
provide specific supports for university students, who are target customers
of Apple but do not have high income. The cost of this sponsorship is
planned to be $150 per unit (one Mini iPhone). The total cost of this
sponsorship can vary depend on the number of university students who wish
to purchase Mini iPhone.
8.4.7 Personal selling tactics
Apple should allocate a direct personal selling assistant to retail stores,
such as Apple store, JB Hifi, and Bond Bond, and at University campuses.
This is to allow the personal selling assistant to answer any questions by
potential customers and to encourage potential customers, such as
university students, to try Mini iPhone. The personal selling activities are
planned to hold for 1 month for 30 personal selling assistant in Auckland.
The cost of sales person per year is approximately $40,000. Therefore, the
total cost for labour costs for this promotional activity will be $100,000.
There will also be material costs, which cover travel costs, sample Mini
iPhone costs, and brochures. Material costs are expected to be about
$86,000. The total personal selling cost is therefore $186,000.
9. Marketing action plan
9.1 Activity (Tactics)
9.2 Responsibility/Accountabilities
9.3 Interdepartmental support
9.4 Timelines: Dates -S = start & E = End. Months/Year
Activity 1 Design and develop Mini iPhone with new features
Design Department
Finance, Purchase
1 January 2013 - 1 April 2013
Step 1: look for cheap materials for producing multi-colour case
Purchase Department
Finance, Purchase
1 January 2013 - 30 January 2012
Step 2: Design strong music and game features and drop non-essential
features
Design Department
Finance
1 January 2013 - 29 March 2013
Step 3: Add wireless earphone features
Design Department
Finance, Purchase
1 February 2013 -31 March 2013
Step 4: Reduce the size of the phone
Design Department
Finance, Marketing
1 March 2013 - 1 April 2013
Activity 2: Set prices for Mini iPhone
Marketing Manager
Finance
1 April 2013 - 1 November 2013
Step 1: Announce the starting price of Mini iPhone
Marketing Manager
Finance
1 September 2013
Step 2: First downside adjustment to price as planned
Marketing Manager
Finance
1 October 2013
Step 3: Second downside adjustment to price as planned
Marketing Manager
Finance
1 November 2013
Activity 3: Distribution arrangement
Production Manager
Marketing
1 February 2013 - 1 May 2012
Step 1: Contact major existing distributors (especially Telecom and
Vodafone)
Production Manager
Marketing
1 January 2013 - 20 February 2013
Step 2: Provide product information to nationwide retailer
Production Manager
Marketing
1 March 2013 - 1 April 2013
Step 3: Construct Mini iPhone official website and add the product to online
store
Production Manager
Design
20 March 2013 - 1 May 2013
Activity 4: Launch IMC marketing campaign
Marketing Manager
Finance
1 August 2013 - 1 December 2013
Step 1: Advertise using 10,000 brochure
Marketing Manager
Advertising
1 Aug 2013 - 1 Sep 2013
Step 2: Advertising via MyFM 886
Marketing Manager
Advertising
1 Sep 2013 - 1 Oct 2013
Step 3: Advertising on TV4
Marketing Manager
Advertising
20 Aug 2013 - 20 Sep 2013
Step 4: Advertising on Facebook
Marketing Manager
Advertising
1 Aug 2013 - 1 Dec 2013
Step 5: Sales promotion competition
Marketing Manager
Sales promotions
1 Oct 2013 -1 Dec 2013
Step 6: University student sponsorship
Marketing Manager
Public relations
1 Oct 2013 -1 Dec 2013
Step 7: Personal selling activities
Marketing Manager
Personal sales
1 Sep 2013 - 1 Oct 2013
10. Budget
A brief budget for Apple to design and promote Mini iPhone is presented in
the table below:
Marketing budget
1 January 2013 to 31 December 2013
Sales
$40,000,000
Less cost of goods sold (50% of sales)
$20,000,000
Gross Margin
$20,000,000
Direct expenses
8.1 product expense
$7,000,000
8.2 pricing expense
$150,000
8.3 distribution expense
$290,000
8.4.1 advertising brochure expense
$30,000
8.4.2 advertising tactics for radio
$193,750
8.4.3 advertising tactics for TV
$492,500
8.4.4 advertising tactics for the internet
$66,000
8.4.5 sales promotion tactics
$78,000 (3 employees)
8.4.6 public relations tactics
$100,000
8.4.7 personal selling tactics
$186,000
Other expenses (administration costs)
$120,000
Total direct expenses
$8,706,250
Contribution Margin
$11,293,750
11. Barriers to implementation
Barrier 1 is the financial costs involved in developing and executing the
Mini iPhone product. Apple is one of the most influential companies in the
world with strong financial and human resources. However, it is still
desirable to undertake the Mini iPhone project if the costs of the
implementation process do not exceed the plan and the budget. The issue is
that it can be difficult to execute new designs for Mini IPhone and control
cost low at the same time.
Barrier 2 is the ethical issue involved in coordinating the production and
distribution of Mini iPhone products. As a convention, the iPhone series is
designed by Apple but is produced in China by the company named
Foxconn. It is important for Apple to establish strong supply chain
relationship and seek overseas manufacturing opportunities with lower
costs. However, ethical issues can arise for production plants and
manufacturing partners in developing countries. For example, the suicides
of workers at Foxcoon, which manufactures IPhone for Apple in Shenzhen
China and the nets to prevent suicides have attracted a lot of attention from
the media (Johnson, 2011). Therefore, there can be pressure from the media
and public and maybe the government for Apple to handle.
Barrier 3 is the technical barrier involved in developing a Mini iPhone
product that satisfies all needs of young customers using current
technology. Technical improvement and innovation can be expensive
especially considering the low prices objective for Mini IPhone. This
requires Apple to continue research and development in technology. The
lack of innovation in iPhone 5 should be studied and avoided in the future
when developing new models, such as Mini IPhone.
Barrier 4 is the employee commitment to the Mini iPhone project. It is
documented that employees in large and successful companies lack the
sense of crisis or urgency (Campling, Poole, Wiesner, & Schermerhorn,
2006). Apple has been highly successful in the past decade with star
products such as iPod, iPhone, iPad, and MacBook. The employees, the
technology department, the marketing department, and even the top
management level, may lack the motivation to commit to the development of
a new product. Low employee morale since the death of Steve Jobs also
contributes to the barrier and the project may be slowed down or
significantly impeded due to this barrier.