Four Ps of Marketing Assignment - Module 4: Promotion

Running Head: APPLE’S DISTRIBUTION STRATEGIES 1

APPLE’S DISTRIBUTION STRATEGIES 4

Week 3: Apple, Inc. Distribution Strategies

Edina Purser

University of Mary

BUS 610 Marketing

Ronald Semarge

28/10/2020

Apple's Distribution Strategies

Apple Inc. is among the globe's most recognized brands. The firm has built its reputation on superior technological innovations, premium products, and a unique marketing mix that allows for strategic distribution. Over the years, Apple has achieved one of the fasted financial and expansion growths. Apple is currently the planet's first brand to gain a market valuation exceeding $2trillion, having previously been the first to reach the $1trillion valuation ((Glimstedt, 2020). Favorable market position may be attributed to Apple's strategic business location and distribution mix, promoting higher sales of Apple's brands. This paper, therefore, dwells on Apple's place or distribution strategies.

Apple has one of the most effective distribution strategies. Having effectively influenced its public image to include premium pricing, its clients associate with the highest quality and perceive them to be high-end products mainly used to symbolize economic status (Glimstedt, 2020). As such, Apple's distribution strategy is focused on this notion as it aims to ensure product exclusivity. There are numerous channels of distribution applied by Apple Inc. to reach its target market. These include mainly the use of Apple-owned stores and third-party vendors/trade partners. Apple applies various strategic partnerships with telecommunication firms and shopping outlets to ensure a wider distribution channel that captures the local American market and international markets. Apple Inc., however, markets its products at a premium and, as such, uses specific distributors (Glimstedt, 2020). Apple believes in maintaining the least number of distributors as a way not only to increase the effectiveness and efficiency of the distribution channels but also a way of managing it to avoid third party price competition. As such, Apple ensures only authorized dealers to handle its products, a group of selected premium retailers who apply product prices as set by Apple. Apple also relies on online sales through its owned websites and other hosted websites, and enjoys wider personnel, making its sales strategy more effective. Apple's distribution strategy is as below;

Place/ Distribution

This element of a marketing mix is mainly used to determine the appropriateness of a firm's selection of its business's venue/location, the point of product distribution. Apple mainly utilized its owned-distribution points, including the use of third parties who are legally authorized to distribute Apple's products. As such, Apple's distribution includes authorized vendors, telecommunications firms, Apple stores, and Apple-owned websites and other owned online platforms (Lockamy, 2017). Apple stores refer to the various subsidiaries owned by Apple and are operated under brick-and-mortar establishments. For instance, Apple mainly sold the iPhone and other hand gadgets and accessories through authorized third parties and owned Apple stores. Clients may also make online purchases through Apple's website. Simultaneously, other products such as music, Apple Apps, including other digital contents, are only available online via Apple Stores and iTunes Store. Apple also utilizes online marketing as a way of including the international market. Apple also relies on telecommunication firms such as AT&T, Verizon, which incorporates its subscription-based service packages with iPhone (Lockamy, 2017). Therefore, Apple's distribution is most effective as it encourages both online and non-online product distribution channels (Glimstedt, 2020). As such, Apple's distribution channel includes;

1. Apple stores- Apple-owned exclusive brick-and-mortar establishments

2. Trade partners- Strategic distribution partners, for instance, Ingram Micro

3. Retailers- Third-party sellers who are selected by Apple and authorized to resell its products

4. Online sales- The use of E-commerce. Mainly Amazon.com and Alibaba

5. Repair and maintenance stores- Apple uses professional salespeople who rely on its clients to explain products' usage and handle customer issues. This strategy draws more clients to Apple and, as such, contributes to its distribution networks.

In conclusion, despite Apple's preference of handpicked third party retailers who offer strategic location across the globe while also promoting its premium marketing strategy, Apple realized the need to integrate other distribution channels. E-commerce, mainly through online platforms, has been super useful as it allows expansion into new markets. At the same time, retail sales through brick-and-mortar establishments provide an opportunity to build on public relations. In general, Apple Inc. incorporates various distribution strategies to reach as many clients as possible.

References

Glimstedt, H. (2020). The iPhone and its antecedents: re-thinking entry and the evolution of platform strategies at Apple Inc. Enterprises et Histoire, (1), 120-151.

Affran, S., & Asare, R. K. (2019). The emergence of New Marketing Distribution Strategies: A Call for A Paradigm Shift. European Journal of Business and Management Research, 4(6).

Lockamy III, A. (2017, July). An examination of external risk factors in Apple Inc.'s supply chain. In Supply Chain Forum: An International Journal (Vol. 18, No. 3, pp. 177-188). Taylor & Francis.