Apple has increased its market demand of its services and products through product differentiation. This unique factor occurs through making the product to be attractive to consumers and more unique than others. Despite stiff competition in the tech market, it has continued creating high demand compared to the others due to good designed products making it have power over prices.it has fully used strategies like innovative advertising, products differentiation, launching of new products hype, ensuring of brand loyalty to be ahead of the curve (Cusumano, Kahl, & Suarez, 2015, pp.559-575). It has created an artificial barrier entry to the market by its competitors by maintain a premium price and focusing on the consumer who is willing to pay higher for its products.
Distribution Strategies of Apple Inc.
Apple distribution channel is through online stores and retail outlet which sell its product direct to the final consumers. It also resells third party products to its major direct market through employing the variety of indirect distribution channels such as value-added resellers, wholesalers, retailers, and cellular network carrier's partnerships. It retail strategy is called minimum advertised price. In this strategy, it has prohibition policy of advertising products from manufacturers, dealers, and resellers at a below a certain minimum price. This policy is enforced by subsiding marketing products from the manufacturer to the offered dealers (Matsui, 2016, pp. 646-657).
They offer a marginal wholesale discount to retailers like Best Buy and Walmart; this has helped them to maintain their popularity in the expensive products. The customer usually pays the price close to that of manufacturers because the percentage discount give is not enough for retailers to make the profit and make a significant marginal discount to the customers on Apple products. But still, the retailer can attract customers by over going this profit margin and offering products discounts. However, to prevent and to avoid this scenario in the market, Apple Inc. Provides monetary incentives for the retailers to be able to sellers the goods to the customers at the fixed minimum price advocated by the company. This policy usually help to prevent direct competition between retailers and Apple stores in the market, because no one has the advantage over the other as the price is the same in the market (De Stefani, 2015). This help to make and keep the whole distribution channels open and clean and still contribute to making more money from its direct sales to the customers.
Retailer stores have given them a competitive advantage to their peers. Apple authorized retailers to have apples accessories and products, and also provides repairs and support to customers. This help to provide valuable customer services and improve retailer experience through direct interaction with the customers. This communication helps them to control their retail experience and to teach what the potential consumers what from first-hand information (Determann, & Perens, 2016).
Another competitive advantage is that Apple stores are strategically located, they are mainly in malls which help because most of the consumers are already in shopping mode thus very easy to spend to Apple products. Behavioral research done by different researchers have shown that; consumer mentality plays a significant role in any retail experience in shopping malls.
Lastly, Apple retailer's stores look and feel experience is great to the customers. They have invested on experiment slowly and strong team who are readily available to listen to customers. Customers can get repairs and support from the same place while they can still do other shopping from a convenient place. This factor helps them to save time and get quality services. Even due to direct conversation with the potential customer, they can get valuable information which can help them to plan for the future and also solve the current problems which the consumers are experiencing thus maintaining good brand image (Baldwin, (2013).