The Homa Files

Excerpted from  Influential Marketing Blog:.”The Real Secret To Apple’s Success”, Rohit Bhargava ; reported by MarketingProfs.com

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At some point just about every marketer is bound to look at something that Apple is doing and wish they could have done it for their own brands.

There is a temptation … to simplify the success of Apple to two things: innovative products and great marketing.

There is a crucial missing third element that most people never talk about  …  they control distribution.

They have their own stores, their own sales people, and their own model for selling their products that cuts out any middleman or competitors completely.

The fact that they control distribution offers many benefits:

Communicates a consistent of messaging – Apple can control their sales force and the messages that they learn to talk about. As a result, everyone tells the same story about their products.

Removes the competition at point of sale – A big issue for many of their competitors is that a customer may come into a store with one product in mind, but can often get steered toward another during the time they are in store. Often they will walk out not with the product they intended to buy, but something that was cheaper, recommended more heavily by the sales staff, or (most frustratingly) another product whose packaging simply was more appealing.

Makes upselling easier – When you walk into an Apple store, everything is Apple branded in some way (even the products manufactured by other companies). As a result, you are in the ultimate upselling situation, where you might pay $45 for a connector cable that would ordinarily cost $5 elsewhere. When you are captive in the store and already spending $499 on a big product, who really cares about another $45, right?

Pricing is controlled – It is virtually impossible to find huge discounts on Apple products (particularly new ones) … if you are setting the places people buy your products, you can also centrally control the price. Not only does this allow for more consistency, it also gives you the ability to include pricing in your marketing materials and ads because you know its the same price everywhere.

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Full article:
http://rohitbhargava.typepad.com/weblog/2008/08/the-real-secret.html

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This entry was posted on October 30, 2008 at 6:30 am and is filed under Mktg - Distribution. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.