Apple Segmentation, Targeting and Positioning

Abhijeet Pratap

December 03, 2023

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In terms of marketing, segmentation, targeting and positioning are three very crucial concepts that help companies target their desired audiences effectively and position their brand for faster growth and success.

In this post, we will analyze Apple’s segmentation, targeting and positioning and their role in terms of the firm’s dominant market position and marketing success.

As we are well aware, Apple is among the most innovative brands globally enjoying very strong brand awareness. Its core product is the iPhone accounting for a very large part of its total annual net revenue.

Segmentation in Apple’s marketing strategy:

Segmentation is an important concept in marketing which involves dividing the market into identifiable segments and then selecting the target audience whose needs the firm can serve efficiently and profitably.

Marketers depend on various types of segmentation for marketing their products. For example, they might select their target markets on the basis of geography. They might select the urban areas in the advanced markets for marketing of their products where they believe their product has higher demand and use. This is called geographical segmentation and is broadly used across all industry sectors. Many businesses including Apple have also divided their business operations on a geographic basis. The geographic region where the demand for Apple products is the highest is its domestic market, the United States.

Demographic and psychographic variables also have a crucial role in terms of marketing. Marketers segment consumers based on their education, earnings, lifestyle, gender, age and several more similar factors that loosely fall into one or the other of the three above categories.
For a large number of Apple customers, its products are also related to their lifestyle and having an iPhone or Apple watch is more of a lifestyle thing than a basic need.

One does not use an iPhone because he needs a high performance smartphone, but also because it is a matter of style. However, while this is true for one customer segment, it will not necessarily apply to every customer segment. Some customers who are more tech savvy and buy products based on their personal and professional needs would value the advanced technological capabilities of the Apple products and the higher privacy and security they offer. So, different customer segments may want Apple products for different reasons. The number of Apple users is higher in the urban areas and it is mostly the people living a faster lifestyle or juggling several roles with important professional responsibilities. People in the 18-45 age group want Apple products because of the several benefits including speed, performance, attractive design, higher privacy and because of the overall excellent experience they offer.

Moreover, Apple is the brand that enjoys the highest customer loyalty and customer loyalty comes from higher customer value and customer satisfaction. Apple customers are more loyal and the primary reason is that Apple has always delivered more than it promises.

Targeting in Apple’s Marketing Strategy:

Marketing does not just include identifying potential customer segments but also includes creating strong and profitable relationships by delivering extraordinary customer value. You should be targeting the right customer segment to develop profitable relationships because while marketing aims to build strong customer relationships, it does not mean sacrificing profits.

Apple makes premium products that are priced higher than most rivals in the market.

So, it has been targeting the higher end customer segment, which is also the most profitable segment for the brand. Its customers are mainly affluent customers from the upper middle class and upper class. However, you will also notice that while the latest models of Apple products are priced higher or may be outside the reach of an average middle class consumer, the older products which are still around are priced affordably. It allows Apple to target a broader set of customers while also achieving higher sales.

The company uses digital channels for the sales and promotion of its products to customers and has also established Apple stores around the world in several of its leading markets to attract customers. While it targets affluent customers mainly, it also targets tech savvy consumers seeking higher privacy and security of their personal data. This may mainly include the high earning professionals, business men and students. Its customers appreciate efficiency and performance but they also mind the aesthetics. Moreover, the larger part of its customer base is not price sensitive or willing to spend on products that bundle all the benefits discussed above.

Positioning in Apple’s Marketing Strategy:

Apple has positioned itself as an innovative and customer oriented brand. Positioning plays a critical role in the success of a business. The company has differentiated itself as an innovative and customer focused technology brand by offering superior customer value and focusing on maximum customer satisfaction. Its products are premium products that promise to deliver superior customer value through performance, data security, beautiful look and a host of features that appeal to various segments of customers.

Apple’s innovative identity is critically linked to its brand image. A large part of its customer base includes professionals that want high performance and innovative products which can easily beat the rivals. When it comes to technology, Apple has remained ahead of the others. Now, comes the pricing part. Apple has priced its products higher than competitors. It does not try to price its products affordably since it is targeting the less price sensitive customers or customers that are not price sensitive at all. It has positioned itself as a premium brand targeted at the higher end market. The pricing strategy of Apple Inc is also targeted at creating and maintaining the image of a premium brand.

However, the main appeal of Apple products is based on quality where quality includes nearly everything from design to performance. Its use of advanced technologies are an important feature that its products appeal to the geeks just as much as they appeal to those that want a smartphone mainly for their entertainment needs.

Apple’s targeting strategy transcends education and gender related barriers. Its products have the same appeal for males and females, as well as working professionals and business owners as much as athletes or developers or artists. While the use of Apple products may be higher among the youth, they also appeal to middle aged and elder customers. It is all about customer value and satisfaction. Apple has positioned itself as a brand that does not compromise on quality or performance and design and therefore never compromises on customer satisfaction.

Apple stands out from the crowd of brands as a highly creative and innovative brand. It is a premium brand that promises maximum performance and highest degree of satisfaction you can have by owning a smartphone, laptop or another of Apple products and services.