Apple Inc.'s iPhone: Can iPhone Maintain its Initial Momentum?
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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International Marketing/ Pricing/Market Skimming Strategies
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UK; Europe; USA
This case is about Apple Inc.'s (Apple) entry into the mobile
phone market by launching the iPhone. The launch of the much hyped iPhone was
hailed as the most successful launch of a brand ever by some analysts.
The case also discusses the various challenges faced by Apple shortly after its
launch including the pricing controversy in the US and the challenges in
marketing the iPhone in Europe.
Apple raised many eyebrows by reducing the price of its much hyped iPhone by
one-third within 10 weeks of the launch.
While some analysts felt that adoption of
such market skimming strategies and subsequent price cuts by
companies selling technological devices was nothing new, others
felt that Apple's decision to reduce the price so drastically
just a few weeks after the launch was nothing short of a public
In November, 2007, Apple launched the iPhone in three European
markets, Germany, France, and the UK. Analysts opined that
despite Apple being a late entrant in the highly competitive
mobile phone market, it emerged as a successful player. However,
a few analysts were of the view that it remained to be seen
whether iPhone would be able to maintain its initial momentum
considering that the challenges in marketing the iPhone in the
European countries were stiffer. Then there was the challenge of
cracking the Asian market. In August 2008, Apple launched the
iPhone in India. The company planned to launch its iPhone in
other Asian markets like Japan, South Korea, and China by the
end of 2008.
» Understand the rationale behind Apple's entry into the
intensely competitive mobile phone market.
» Understand the challenges faced by Apple while entering a new market with a
new product like the iPhone.
» Understand the issues and challenges faced by Apple while launching the iPhone
in Europe and Asia.
» Analyze Apple's strategy of slashing the price of its iPhone so soon after the
» Understand the issues and challenges in pricing a product or service (pricing
decisions, premium pricing, market skimming, etc).
» Understand how pricing could affect product adoption and diffusion.
International marketing, Pricing, Public relations, Public
relations, Buzz marketing, iPhone, Apple, Samsung, Nokia, Macintosh, Sony