UNIVERSITY OF NORTHAMPTON FOREIGN TRADE UNIVERSITY
SCHOOL OF BUSINESS HO CHI MINH CITY CAMPUS
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END-MODULE ASSIGNMENT
Module: Principles of Marketing Management
Code: MKT3017
ASSIGNMENT 1
FOR EXAMINERS ONLY
Student: NGUYỄN HUY PHÚC Grade (in number):
………………..
Student ID: 2105025058
Grade (in words):
Cohort: K60NOB ………………..
Semester: I Examiner 1
Academic year: 2024-2025 (Signature & Fullname)
………………..
Headteacher:
Examiner 2
Submission date: 8 December 2024 (Signature & Fullname)
Student’s signature: ………………..
Ho Chi Minh City, December 2024
UNIVERSITY OF NORTHAMPTON FOREIGN TRADE UNIVERSITY
SCHOOL OF BUSINESS HO CHI MINH CITY CAMPUS
----------***---------- ----------***----------
END-MODULE ASSIGNMENT
Module: Principles of Marketing Management
Code: MKT3017
ASSIGNMENT 1
Student’s fullname: NGUYỄN HUY PHÚC
Student ID: 2105025058
Cohort: K60NOB
Semester: I Academic year: 2024-2025
Lecturer: Assoc. Prof.Ms Nguyễn Thị Thu Thảo
Ho Chi Minh City, December 2024
STATEMENT OF AUTHORSHIP
Except where reference is made in the text of the end-module assignment, this
assignment contains no material published elsewhere or extracted in whole or in part from an
assignment which I have submitted or qualified for or been awarded another degree or
diploma.
No other person’s work has been used without due acknowledgements in the end-
module assignment.
This end-module assignment has not been submitted for the eveluation of any other
modules or the award of any degree or diploma in other tertiary institutions.
Ho Chi Minh City, 8 December
2024
Nguyen Huy Phuc
Executive summary
This marketing audit examines Apple's performance regarding the iPhone in China which is
the biggest market for smartphones with strong local brands like Huawei and Xiaomi. The
PESTLE framework, competition analysis and SWOT analysis are used in the report to
investigate Apple’s external and internal environments. The firm’s large market share has
been attributed to its creative products, premium brand identity, and the fondness of the
client. However, there are problems like the high cost of their products, growing local
competitors, and shifts in the consumers’ needs toward cheap and inventive offerings. Still,
there are opportunities such as economic advancement in the world’s second largest
economy, a rising middle class, and e-commerce. Last section is about strategic priortities of
Apple in the upcoming year.
1. Introduction
This following marketing audit report will focus on Apple iPhone's performance in the
Chinese market, the world's largest cellphone market, where Apple confronts strong rivalry
from indigenous brands like Huawei and Xiaomi. Besides it includes a contextual
examination of the external and internal environments, competition analysis, and customer
analysis. It also evaluates the company’s present framework and SWOT model and makes
recommendations for improving marketing performance.
2. Background
Apple Computer, Inc. was established on April 1, 1976, by college graduates Steve Jobs and
Steve Wozniak, who envisioned transforming public perceptions of computers [Macworld,
2006]. Apple Inc. CEO Steve Jobs debuted the iPhone to the public on January 9, 2007,
during a keynote event. Apple is an international leader in cell phone technology and the
driving force behind the mobile phone industry's sustainable growth (Zhaoxiang Li, 2023,
p19). Apple considers innovation to be their core value, arguing that "technology is most
powerful when it empowers everyone". Apple Inc.'s perspective is that "sometimes a word is
worth a thousand pictures"(Zhaoxiang Li, 2023, p19). The first generation iPhone model,
dubbed iPhone 2G due to its lack of 3G connectivity, was introduced in the UK, France,
Germany, Ireland, and Austria. Initially, the first-generation iPhone had few functions
beyond phone calls and text messages. The iPhone's popularity can be attributed to its
innovative features, including the first finger-sensitive touchscreen and apps not found in
other phones at the time. They focuses on those with incomes, including learners, working
managers, and administrators (Johnson et al, 2012).
During three years of the iPhone's launch, Apple were selling more than 50 million
smartphones. In 2018, Apple became the first corporation to be evaluated at one trillion
dollars due to the popularity of iPhones, and two years later it doubled that amount. These
sales figures are steadily increasing. The iPhone which is its primary products of company,
holds a significant market share in the China, accounting for nearly a half of smartphone sales
in late 2024 (Ahmed Sherif, 2024). In 2023, Apple reported $73 billion in revenues from the
bigger China region, accounting for 19% of its total sales (Reuters, 2025).
3. Macro-environment analysis
3.1 Political and legal factors
The circumstances in which Apple markets its goods and services to the Chinese market
might be critically inspected by referring to the bigger picture confronting the company in the
Chinese market, such as by examining the macro environment within the PEST framework
(Payne 2017, p.51). Firstly, Apple must facing the environment of political stability in China,
but the company must be aware of potential inefficiency and corruption in the Chinese
government while introducing and advertising its products and services in China. Secondly,
Apple Inc. might benefit from the strong economic expansion in the Chinese market, with
low wages and rising affordability of the Chinese customers who purchase goods and
services from the firm. Lastly, technologies has been one essential distinctive advantage that
Apple is approaching the Chinese market, to persuade Chinese buyers of its superiority in
comparison to the numerous competitors (Khan et al, 2015, p. 955). In reality, the newest
technology employed in Apple products attract to numerous Chinese buyers, converting them
into committed users of Apple.
3.2 Environment factors
During 2012-13, the rate of joblessness in the US was 7.9, while in China and Japan it was
4.1 and 4.6, respectively (Apple 10-K). These factors contributed to a decline in sales growth.
China is an important market for Apple because of its status as an international economic.
The economic expansion of China has resulted in a large middle-class population with rising
financial resources, driving up demand for premium cellphones such as the iPhone (Keith,
2024). However, changeable economic conditions, such as reduced GDP growth in the past
few years, can have an impact on customer spending, particularly on luxury products. The
macroeconomic climate provides opportunity for business growth. This part of the
PESTLE/PESTEL analytical methodology emphasizes environmental developments and their
implications for business (Jahan, S. A. & Sazu, M. H. , 2023).
Figure 1 : The figure is showing PESTLE Analysis in China, 2024
Cited from : Jim Makos (2024). PESTLE Analysis of China: How the Sleeping Giant Woke
Up and Got to Work [online] Available at: https://pestleanalysis.com/pest-analysis-of-
china/
The Currency swings among the Chinese Yuan and the US currency also impact Apple's
pricing tactics. A lower Yuan could render the iPhone more costly for Chinese buyers, thus
reducing sales. Furthermore, economic regulations, such as import taxes, can test Apple's
competitiveness versus local companies like Huawei and Xiaomi (Jessica Lombardo, 2024).
The rapid rise of Chinese e-commerce sites, such as Alibaba and JD.com, provides Apple
with further market penetration prospects. These platforms correspond with increasing
customer expectations for online buying, promoting larger accessibility (Contributor, P.,
2021).
4. Micro-environment analysis
4.1 Company
Apple company is a prominent enterprise in the creation and production of electric gadgets,
has a diverse product line, a strong reputation, and the ability to innovate, allowing it to lead
the industry in the worldwide market (Sangari et al. 2015, p. 209). Initially, the company
Apple has a high recognition among its numerous enterprises in the Chinese marketplace.
Some buyers perceive Apple devices as representing cutting-edge and excellent user
experiences. Others value the peer impact and use Apple items to demonstrate their higher
social position amongst their peers (Cantrell et al., 2017, p.2). Apple's high reputation stems
from many years of efforts to provide creative and consumer-friendly devices and services. In
addition, Apple Inc. produces only between two and three iPhone models per year, permitting
the research and development group to concentrate on the unique style in order to maintain
outstanding products (Katsikeas et al., 2016, p. 6). This is one benefit over plenty of rivals,
such as Huawei, who offer multiple quality product designs and must split the resources they
have to build numerous variations in operations (Katsikeas et al., 2016, p. 6). On the other
hand, certain consumers are criticizing the price tag of products from Apple since they did
not have choices of low-cost things. Thirdly, Apple is forming a community of committed
consumers in order to establish and sustain brand loyalty, as well as generate profits and
competitive benefits from connecting with them (Chen et al., 2015, p. 479).
Figure 2 : The picture is showing that Which is the Most Popular Phone Brand In China?
Cited from Nana Appiah (2024)What Phone Brand is the Most Popular Internationally?
[online] Available at: https://www.biztechafrica.com/article/popular-phone-brands-in-the-
world/
4.2 Customers
The majority of Iphone's users in the Chinese market are affluent and youthful, with a strong
preference for Apple products and services. There are two important segments on which
Apple focuses on its marketing efforts. The first major component is young and vibrant
workers with high salary levels. They are able to spend on Apple's products. A great deal of
the company's loyal consumers have been updating their Apple goods with new models for
years (Kashmiri & Mahajan2015, p. 288). As a result, these consumers are extremely devoted
to Apple's products, making them valuable customers that Apple Inc. should stress through its
different advertising and promotional efforts (Kashmiri & Mahajan 2015, p. 288).
The second crucial sector consists of clients who are particularly sensitive to design and
cutting-edge technology. Instead of remaining devoted to the iPhone's products, those
consumers are sensitive to trends and the latest technology, which may offer new experiences
for the target audience in the competitive market (Miles 2017, p. 437). The two-key section
mentioned above will assist Apple understanding the characteristics of its target clients.
4.3 Suppliers
Apple's manufacturing facility is primarily reliant on a large network of suppliers in China,
highlighting the need of an effectively optimized supply chain. China is both a core
production center and a crucial market for Apple as well as large labor. These vendors are
critical in delivering top-notch parts such as electronic components, camera modules, and
batteries, which are all required to maintain Apple's luxury product standards.
Management of supply chains in China exemplifies the imperative of synchronizing
operations with consumer wants and market developments. Supply chain management in
China demonstrates the need of aligning operations with customer wants and market
developments (Johnson, J.E. and Haug, P. 2021, p701). Apple prioritizes vertically integrated
operations and managing relationships with suppliers to sustain its competitive advantage and
adjust to market shifts. For example, fast shifts in customer tastes in China, such as the desire
for environmentally friendly products, have prompted Apple to collaborate with suppliers to
implement more sustainable processes.
4.4 Perceptual map
The market share of Apple is driven by experience, which appeals to buyers' minds and
hearts. Apple's marketing approach focuses on high price and prenium product, with a focus
on its reputation through expensive prices.
Figure 3: Perceptual mapping of Apple iPhone
Cited from: Geoff Fripp (2024) Perceptual mapping of Apple iPhone [online] Available at:
https://www.expertsminds.com/content/sample-paper/brand-positioning-and-brand-equity-
assignment-help-13770.html
4.5 Competitors
Firm positioning within its competitive industry has always played a vital role in marketing
mix elements such as price, place, promotion, and product (Faghih et al. 2018, p. 16).
Huawei, Samsung, and Xiaomi are the strongest competitors of Apple in the Chinese market,
each of them have special features and affordable price ranging from low to high.
Competitors assessments could well-identify and compare Apple's competitors based on two
factors: cutting-edge technologies and affordable costs (Mills 2015, p. 643). The following
figure summarizes the positions of Apple and its competitors years over years.
Figure 4: Year over Year comparison of China's top smartphone manufacturers
Cited from: Team Counters (2024) Apple drops to fourth place in China's smartphone sales
[online] Available at: https://forums.appleinsider.com/discussion/235656/apple-drops-to-
fourth-place-in-chinas-smartphone-sales
From the figure we can see that Huawei expanding by 64% and Apple dropping by a massive
24%. The most popular smartphone maker in China for the first six weeks of 2024 was Vivo
with an 18% market share, this was followed by Huawei in second place and Honor in third
with 16% market share. This highlights the need of Apple having a more targeted marketing
plan to better reach this billion-person market as well as Apple should partner with other
brands to produce compatible products (Khan, et. al,2015). The numbers take Huawei ahead
of Apple, but only slightly, and no where near the margins suggested by the 64% growth as
compared to the 24% decline. "Huawei was back strong at the high end, while OPPO, vivo
and Xiaomi squeezed Apple from the middle," noted the senior analyst Mengmeng Zhang.
5. SWOT Analysis
The SWOT table, which assesses the internal and external environments and challenges of
the Apple in relation to the opportunities and threats presents a working strategy in the
chinese market.
Table 1: SWOT analysis
Strengths Weaknesses
The unique value proposed to the target customers The high prices criticized by some
Good reputation as one global famous example of customers
providing high quality services products and services The limited models available for the
The capabilities of organizing a community with loyal customer Limited innovation with new
customers products in recent years
Opportunities Threats
Rapidly economic growth in China, to result of Fierce competitions from the many
increases in demands of the target customers competitors Changing tastes of the
Technological advances, to mean new experiences for customers while they are having many
the target customers Increasing requirements of choices and they are enjoying low
customers to require fashion and innovative products, transition costs
such as provided by Apple Inc. Raising new operators in China
Table 2: Internal Environment and External Environment
Opportunity (O): Threat (T):
External and Internal The customer electronics industry The economy of the China is
Environment is vast, with a strong preference deteriorating, and customer trust is
for premium products. dwindling. Moreover, battling many
powerful.
Advantage (S): The SO strategy (the expansion ST Strategy (Diversification Strategy):
Excellent awareness of the strategy): Involves capitalizing on Using the benefits of modern
brand image. electronic product sales and technology, creativity, branding, and
Emphasis on R&D. reducing costs through outsource marketing, as well as the high gross
Excellent creativity ability. and rival suppliers. margin of high-end items to combat the
Effective implementation of financial crisis and opponents' low-price
new technology and research competitors.
findings
Disadvantage (W): Diverse Wo strategy (twist strategy) WT Strategy (defensive strategy):
product portfolio, involves outsourcing and support. To boost productivity while lowering
prioritizing technological costs, emphasize the need of methodical
innovation over profit management in both cost and quality
maximization. management.
6. Strategic Priorities
Based on Apple's current status and SWOT analysis, a several priorities have been
determined for the coming fiscal year.
Expand the price strategy.
The previous iPhone models can be marketed to low-income clients without immediately
ceasing production when the new ones hit the market. This method can significantly boost
Apple's appeal to customers at lower income. Simultaneously, they should adopt a customer-
oriented pricing strategy based on the various needs of customers with varying spending
levels. For instance, they should apply lower model in order to attract more customers with
different needs, such as the elderly who only require basic smartphone feature.
Enhance the product line.
In the era of large-screen supremacy, Apple has marketed small displays as device benefits
such as the 4-inch design, which is easier for people to control with one hand. Therefore,
Apple should bring back the mini-series for those who prefer to use one hand. In addition,
Apple should begin to research popular folding display mobile phones. Huawei and Samsung
have produced folding display mobile phones with unique features. This makes Apple unable
to compete with Huawei and Samsung in the Chinese market.
Enhancing Marketing Strategies.
Apple can no longer depend only on word-of-mouth advertising for their new Iphone in
China. Instead of that, they should try advertising. The advantage of the advertising is that
advertising messages could also emphasize the new innovations that these products possess
or the superiority of these products over their rivals in order to draw more customers. Hence,
they should in the future think about having commercials using pictures taken with the
iPhone and advertising the phone’s feature of taking photographs. This approach has the
ability to suprise a client and makes a client is likely to have a curios for trying a new things.
7. Conclusion
The Chinese market has an inherent preference for Apple’s iPhone from a variety of diverse
viewpoints, such as the brand’s prestige in terms of creativity and quality as well as its fan
base, however, there are other Chinese companies who are giving tough competition to
Apple, such as Huawei. Apple iPhone’s price strategy is challenging for the wider group of
people. These factors are further worsened by Socioeconomic trends that make the market
understand that their offering needs to be cost-effective and cutting edge. Further for Apple to
be able to hold its position in the market, they has to adopt a more dynamic pricing strategy,
develop more advanced technologies and enhance local advertisement policies targeting
Chinese consumers.
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