Moroccan or Thai market... apple next step with IWatch

1 Marketing Plan for Apple iWatch

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Notifications. Activity. Siri. Apple Pay. Right on your wrist.

Final Assignment

Strategic Marketing Plan for Apple iWatch

Foreign Market Analysis

Prepared By

Mohamed Ali Salem


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Contents Executive Summary: ..................................................................................................................................... 5

Introduction: ................................................................................................................................................. 7

Analysis Thailand and Morocco ................................................................................................................... 9

Introduction .............................................................................................................................................. 9

Economic Analysis ..................................................................................................................................... 9

Country Reports, Analysis and Data.......................................................................................................... 9

Morocco .................................................................................................................................................. 10

1. About Morocco ........................................................................................................................... 10

2. Quick Facts .................................................................................................................................. 10

3. Morocco Economy ...................................................................................................................... 11

4. The Economic freedoms ............................................................................................................. 12

5. Regulatory Efficiency ................................................................................................................... 12

6. Open Markets ............................................................................................................................. 13

7. Technology in Morocco ............................................................................................................... 13

8. Morocco SWAT analysis .............................................................................................................. 14

Thailand .................................................................................................................................................. 16

1. About Thailand ............................................................................................................................ 16

2. Quick Facts .................................................................................................................................. 16

3. Thailand Economy ....................................................................................................................... 17

4. The Economic freedoms ............................................................................................................. 18

5. Regulatory Efficiency ................................................................................................................... 18

6. Open Markets ............................................................................................................................. 19

7. Technology in Thailand ............................................................................................................... 19

7.1. Technology statistical .............................................................................................................. 21

8. Thailand SWAT analysis............................................................................................................... 22

Morocco vs. Thailand ................................................................................................................................. 25

Evaluation of potential ............................................................................................................................... 28

Smartwatch ................................................................................................................................................ 28

1. Definition .................................................................................................................................... 28

2. The History of Smartwatches ...................................................................................................... 28

a. Foundation .................................................................................................................................. 28

b. Imagination ................................................................................................................................. 29


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c. Electrification .............................................................................................................................. 29

d. Experimentation ......................................................................................................................... 30

e. Commercialization ...................................................................................................................... 30

Apple Watch ............................................................................................................................................... 31

1. Apple Watch vs. Others .............................................................................................................. 31

2. Smart Watches, PROS and CONS ................................................................................................ 33

3. Smart Watches, Tech Specs and Price ........................................................................................ 34

5. Apple Watch SWOT analysis ....................................................................................................... 36

Evaluation of the business potential for new iWatch in Morocco and Thailand. .................................... 39

1. Smart Watches, Worldwide market............................................................................................ 39

2. Smart Watches, Thailand market................................................................................................ 41

a. Thailand Operating Systems (OS) Market Share, Usage Statistics – 2014 .................................. 41

b. Market share Thailand smartphone 2014 .................................................................................. 41

3. Operating Systems, Morocco market. ........................................................................................ 42

4. Market share Morocco smartphone 2014 .................................................................................. 42

Evaluation of the potential demand for the Apple iWatch ...................................................................... 43

Country choice: ........................................................................................................................................... 46

Determining targets ................................................................................................................................... 48

1. Expected sales of iWatch: ........................................................................................................... 48

2. Target: Segmentation of markets and customers: ..................................................................... 49

Strategy of marketing plan ........................................................................................................................ 51

1. Product Positioning: ............................................................................................................................ 51

2. Marketing Mix ..................................................................................................................................... 52

1) Product ................................................................................................................................................ 52

2) Price .................................................................................................................................................... 53

3) Promotion ........................................................................................................................................... 60

4) Place .................................................................................................................................................... 62

Marketing activities to launch the Apple watch in Thailand: ................................................................... 63

1) Objectives............................................................................................................................................ 63

2) Marketing mechanism. ....................................................................................................................... 63

3) Marketing activities. ........................................................................................................................... 64

Conclusion .................................................................................................................................................. 68

References .................................................................................................................................................. 69


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List of figures Figure 1 ( Marketing plan process ) ............................................................................................................. 9

Figure 2 (Morocco - Economic facts) (heritage.org, 2015) ........................................................................ 10

Figure 3 (Morocco’s GDP) (heritage.org, 2015) ......................................................................................... 12

Figure 4 (Thailand-- Economic facts) (heritage.org, 2015) ........................................................................ 16

Figure 5 (Thailand's GDP) (heritage.org, 2015) ......................................................................................... 18

Figure 6 (GDP Growth Rate) (heritage.org,2015) ....................................................................................... 25

Figure 7 (GDP Per Capita) (heritage.org,2015) ........................................................................................... 26

Figure 8 (Unemployment) (heritage.org,2015)........................................................................................... 26

Figure 9 (Inflation) (heritage.org,2015) ..................................................................................................... 27

Figure 10 (Smart Watches Ranking) (werockyourweb.com, 2015) ........................................................... 36

Figure 11 (Top10 smartwatch manufacturers by unit sales in 2014) (statista.com, 2015) ...................... 39

Figure 12 (Smartwatch shipments in Q2 2015) (statista.com, 2015) ........................................................ 40

Figure 13 (Thailand Operating Systems (OS) Market Share) .................................................................... 41

Figure 14 (Market share Thailand smartphone) ........................................................................................ 41

Figure 15 (Operating Systems (OS) Market Share) .................................................................................... 42

Figure 16 (Market share Morocco smartphone) ....................................................................................... 42

Figure 17 (Revenue and profit Q3 2014 VS Q3 2015) (apple.com, 2015).................................................. 43

Figure 18 (Revenue by operating segment Q3 2014 VS Q3 2015) (apple.com, 2015) .............................. 43

Figure 19 (Apple Q3 2015 Revenue) (apple.com, 2015) ............................................................................ 44

Figure 20 (Expected sales of iWatch in Thailand) ...................................................................................... 48

List of tables Table 1 (Morocco vs. Thailand) .................................................................................................................. 27

Table 2 (Smart watches-Prons and cons) (werockyourweb.com, 2015) ................................................... 34

Table 3 (Smart Watches - Tech Specs and Price) (werockyourweb.com, 2015)........................................ 35


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Executive Summary:

The purpose of this plan is to find the right actions to develop a strategy in order to access the Moroccan

or Thailand market, solving cultural differences and other challenges. Collecting information about the

target market is a key ingredient to identifying challenging external factors such as language, culture,

amount of competitors and market environment in general Lack of knowledge or familiarity with the

target market environment, customer needs, business culture and competitors might mislead us in this

process of Moroccan and Thailand entry.

I analyzed the Morocco and Thailand through SWOT analysis, SWOT indicates that each country has its

own strengths and weaknesses and there are plenty of opportunities in the higher risk countries just as

there are numerous threats that Apple Inc. need to be careful of in the lower risk countries.

The results from SWOT analysis are led me to choose Thailand based on Thailand’s statistics and records

which Thailand outperformed Morocco.

I conducted a marketing analysis of Apple new product, which is also a new exploration into its new

category line, Apple Smart Watch which is mostly called as Apple Watch. The concept of smart watches

has recently been introduced in the Thai market already with companies such as LG, Motorola, Samsung


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and many more and now Apple will also sail in the same boat. The slightly late entry of Apple smart watch

into the market can be a great challenge to prove itself in the Thai market.

The consumer analysis with the current competitors in the market gives us an idea of the challenges the

new product may face based on its acceptability within the market segment.

The segment mainly targeting younger to medium age group (16- 40 years) with income groups of above

average to high does limit the product to be the first choice amongst consumers, as consumers may not

be willing to shell out a lot. The marketing mix developed for the product keeping in mind the consumer

segment to target high income consumers and consumers who are willing to try this product such as

achievers and experiencers is well appreciated, however this limits the scope of the product within the

rest 69% of the market who are not currently using apple based phones, as the compatibility of the

product is very limited. The aim here is to analyze the possible factors that lead to the limitation of the

success of the product and make alternative recommendations to penetrate the Thai market.

The product although with it’s in depth personalization features, range of choices with accessories and

product itself and sole determination to bring upon a healthier lifestyle. Recommendations on launch

Apple Watch in Thailand through several of activates for instance (web Ads, Social Media Ads, TV Ads) to

attract more Thai customers.


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Introduction:

Apple looks for new markets, especially emergent markets which offer new opportunities for investing

and marketing their products and service with low costs. Apple found a good opportunity to enter the

Moroccan/Thailand market due to the strategic position, the proximity to their actual location and the

high demand of Tech products and services. The purpose of this plan is to find the right actions to develop

a strategy in order to access the Moroccan/Thailand market, solving cultural differences and other

challenges. Collecting information about the target market is a key ingredient to identifying challenging

external factors such as language, culture, amount of competitors and market environment in general. On

the other hand, Apple must identify its internal factors, strengths and weaknesses, regarding to the

company experience, size and product portfolio in order to develop a successful market entry strategy

which will fit the Moroccan/Thailand market. Lack of knowledge or familiarity with the target market

environment, customer needs, business culture and competitors might mislead the company in this

process of Moroccan/Thailand entry.

Core brand values of Apple.

1) Innovative

Apple is known to be one of the most innovative brands with its Macintosh line of computers,

IPod, IPad, ITunes, IPhone and whatnot. There are many innovations which were brought into the

market before any other company could even think of such innovations.

2) Premium marketer

Apple is known as a premium brand. In fact, it is a cream brand which is always using skimming

price and never enters price competition, showcasing its products to be above competition. Thus,


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with no surprise, Apple customers love their products and tend to show off a bit. They strongly

believe in Apple, and that Apple is a product which is hard to obtain and has features unparalleled

by any other company.

There are several versions of Smart watches which have been launched by both Samsung and LG. In fact,

Samsung used its smart watch quite efficiently with the Samsung note 3. And LG, although not successful

with its smart watch.

Smartphones changed everything, putting multi-touch computers in our pockets. Tablets then created a

new middle-ground product that was more immersive than a phone but more handheld than a laptop.

But what do Apple Watch do? It take all the things we're already doing, and give us slightly easier access

to them.


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Analysis Thailand and Morocco

Introduction

Objective is Launch of the new iWatch (the Apple new watch) in one country, Thailand or Morocco

Marketing plan consists of the following 4 steps: Analysis, Country choice, Target and Strategy.

Figure 1 ( Marketing plan process )

Economic Analysis

The countries’ economic investigation include data and analysis on economic indicators as shown

below. Each country has many supporting figures covering trade, imports & exports, policies,

banks, companies, insurance and so on.

Country Reports, Analysis and Data

Reports on economic activity, trends and developments, together with forecasts on economic

expectations are widely available. Countries’ population figures are derived from various sources

including estimates from national governments, the World Bank, the IMF.


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Morocco

1. About Morocco

Officially known as the Kingdom of Morocco and situated on the northwestern corner of Africa;

Morocco borders Algeria on the east and southeast, Mauritania to the south and to the west by the

Atlantic Ocean.

2. Quick Facts

Figure 2 (Morocco - Economic facts) (heritage.org, 2015)


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Morocco’s economic freedom score is 60.1, making its economy

the 89th freest in the 2015 Index. Its score is 1.8 points better than

last year, with a very large improvement in trade freedom and

smaller gains in freedom from corruption, labor freedom, and

monetary freedom outweighing declines in business freedom and

the management of government spending. Morocco is ranked 9th

out of 15 countries in the Middle East/North Africa region, and its

overall score is just below the world average. (heritage.org, 2015)

Committed to economic reform, Morocco remained largely

immune from significant Arab Spring protests. Over the past five

years, gains in five of the 10 economic freedoms, including labor freedom, monetary freedom, and

investment freedom, have offset declines in the management of public spending and business

freedom. Morocco has regained “moderately free” status in the 2015 Index.

Proximity to Europe and a free trade agreement with the United States have helped to establish a

foundation for dynamic economic growth. Openness to global trade and investment has facilitated

the development of a modern and competitive financial sector. Relatively prudent fiscal policy has

encouraged macroeconomic stability and greater structural reform

3. Morocco Economy

Morocco’s economic growth is far more diversified, with new service and industrial centers such as

Casablanca. In 2015, Morocco’s GDP was US$ 179.2 billion, growing 4 percent and is expected to grow

6.86 percent to US$ 196.326 billion in 2016. Forecasts for 2020 predict Morocco’s GDP to reach US$

225.651 billion, growing about 7 percent per year between 2015 and 2020. (www.heritage.org, 2015)

Population: 32.9 million

Median age: 28.1 years

GDP: $179.2 billion

GDP per capita: $3400

Unemployment: 9.2%

Inflation (CPI): 1.9%

Public Debt: 61.9%of GDP

QUICK FACTS


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Figure 3 (Morocco’s GDP) (heritage.org, 2015)

Morocco’s population as of 2014 was 32.072 million, and is expected to grow to 33.353 million by

2016. Current (2015) unemployment in Morocco is 9.2 percent, down from almost 12 percent in 2005,

and is expected to go down to 9.1 percent in 2016.

4. The Economic freedoms

Widespread corruption undermines investor sentiment and

raises the cost of operating a business. Recent cases have

involved the embezzlement of millions by public servants. In

addition to his public role, the king is the majority stakeholder in a vast array of private and public-

sector firms. The courts are inadequate and cannot be relied upon to rule quickly or fairly.

5. Regulatory Efficiency

Incorporating a business takes five procedures and less than a

week, with no minimum capital required, but completing

licensing requirements still takes about three months on

average. Labor market rigidity continues to discourage dynamic

job growth. In January 2014, the government ended costly gasoline and fuel oil subsidies, but it

maintained some food subsidies.


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6. Open Markets

The average tariff rate is 3.4 percent. Tariffs have fallen, but

regulatory issues may delay trade. Foreign investors cannot buy

agricultural land, and investment in some economic sectors is

regulated. The financial system has undergone modernization

and expansion. Morocco’s banking sector is one of the most liberalized in North Africa. The stock

market does not restrict foreign participation.

7. Technology in Morocco

The information technology sector in Morocco has been witnessing significant expansion. Morocco is

the first country in North Africa to install a 3G network. The number of Internet subscribers in the

country jumped 85.4% in 2014 over the year-ago period. Further, a new offshore site at Casablanca,

with state-of-the-art technologies and other incentives, has grabbed the attention of many global

multinationals. Setting up offshore service centers in the nation has become tempting. Such is the

rate of growth, that off-shoring and IT activities are estimated to contribute $500 million to the

country’s GDP and employ 30,000 people by end of 2015. The communications sector already

accounts for half of all foreign direct investments Morocco received over the past five years.

The mobile telephony segment comprises three operators:

Maroc Telecom, Méditel and Wana the mobile telephony

market is growing rapidly, the number of subscribers reached

43.2 million in September 2015. In 2015, over 73.5 percent of

the population had more than one mobile phone in their households.

In the fixed-line telephony segment, 3G telecommunications licenses have been granted to two

operators, Méditel and Wana. The data on fixed-line telephony published by the national

telecommunications regulator ANRT in March 2008 indicate a fixed-line penetration rate of about

13.3 per cent, with the number of subscribers rising from 1.62 million in March 2007 to over 2.71

million in March 2008. (wikipedia.org, 2015)

Morocco’s mobile market approached 135% penetration in early 2016, among the highest

penetration rates in the region. All three mobile network operators also provide fixed-line or fixed-


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wireless services, and the boundaries between fixed and mobile services are disappearing as

technologies and services provided by these players converge.

The mobile operators have also become the main providers of internet services through their 3G

networks. The auction of spectrum for LTE use in March 2015 is expected to be followed by the

commercial launch of LTE services by the end of the year. License conditions will ensure that LTE

covers at least 65% of the population by 2020. This infrastructure, and anticipated subscriber take-

up, will further consolidate the dominance in these mobile players in the broadband sector.

(wikipedia.org, 2015)

8. Morocco SWAT analysis

Investing and exporting products and services to new foreign markets is

becoming more and more popular.

Companies look for new markets, especially emergent markets which offer

new opportunities for investing and marketing their products and services

with low costs.

SWOT analysis can be used effectively to analyze the country’s position and capability in order to

determine the feasibility of the business opportunities.


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Str

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Stable political situation and economy Positive business environment for foreign market and product. Europe strong as a trade partner. Only 14km south of Europe, Morocco is a competitive platform for trading. Low Wages: The average wage is 327$/month, i.e. almost ten times lower than in

Spain. Low Tax rates : Taxes paid by companies represent only 49% of their profit A continuously growing economy with an average growth rate of 4.7% over the

period 2001-2013. The Moroccan economy has proved its resilience, with an annual GDP growth of

4.4% between 2008 and 2013. Inflation is maintained below 2% The Free Trade Agreement with the United States (Morocco’s 6th largest trade

partner) is part of the overall strategy of the Moroccan economy. Morocco is the first country in the southern side of the Mediterranean to benefit

from the advanced status in its relations with the European Union Telecommunications infrastructure meeting international standards. Three global

operators (Fixed phone, mobile, Internet and data), the telecommunications sector in Morocco achieves every year an intense and sustained activity: 129% mobile penetration and 16 million Internet users (2013)

A young and active population.

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Corruption. Low living standards High unemployment rate. Low level of education Infrastructures Labor productivity

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Geographical location Tourism No barriers of market entry Growing economy

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Increasing costs Financial capacity Growing competition and lower profitability Tax changes Increase in labor costs


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Thailand

1. About Thailand Officially the Kingdom of Thailand, formerly known as Siam, is a country at the center of the

Indochinese peninsula in Mainland Southeast Asia. It is bordered to the north by Myanmar and Laos,

to the east by Laos and Cambodia, to the south by the Gulf of Thailand and Malaysia, and to the west

by the Andaman Sea and the southern extremity of Myanmar. Its maritime boundaries include

Vietnam in the Gulf of Thailand to the southeast, and Indonesia and India on the Andaman Sea to the

southwest. Thailand is located in the heart of Southeast Asia. With a surface area of approximately

513,000 sq. km, Thailand is the 50th largest country in the world in terms of total area. Thailand was

also the 21st most populous country, with approximately 68 million people.

2. Quick Facts

Figure 4 (Thailand-- Economic facts) (heritage.org, 2015)


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Thailand’s economic freedom score is 62.4, making its economy

the 75th freest in the 2015 Index. Its score has decreased by 0.9

point since last year, with deteriorations in financial freedom,

property rights, and the control of government spending

outweighing small improvements in six of the 10 economic

freedoms, including labor freedom, fiscal freedom, and freedom

from corruption. Thailand is ranked 12th out of 42 countries in

the Asia–Pacific region, and its overall score is higher than the

world and regional averages. Thailand’s economic freedom score

has declined for three years in a row. Since 2011, economic

freedom in Thailand has fallen by 2.3 points. Score declines in a majority of the 10 economic freedoms

have been led by double-digit declines in investment freedom and labor freedom and a nearly double

digit drop in the control of government spending. Political unrest and conflict between rural and urban

voters have led to increased perceptions of corruption and an unsteady investment climate. A growing

foreign automobile manufacturing industry provides evidence of the benefits of increasing economic

openness, but the business environment for small entrepreneurs remains difficult due to inefficient

business and labor regulations. (heritage.org, 2015)

3. Thailand Economy

Thailand experienced the world's highest growth rate from 1985 to 1995, following which it saw a

contraction in economy by 1.9% in 1997. The year uncovered weaknesses in the financial sector and

forced the then Prime Minister, Chavalit Yongchaiyudh, to float the currency. The country is

considered a newly industrialized country, with tourism and exports contributing significantly to the

Thai economy. (heritage.org, 2015)

Population: 68.2 million

Median age: 28.1 years

GDP: $673.3 billion

GDP per capita: $3400

Unemployment: 0.8%

Inflation (CPI): 2.2%

Public Debt: 45.3%of GDP

QUICK FACTS


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Figure 5 (Thailand's GDP) (heritage.org, 2015)

Thailand's economy started to recover, expanding by 4.2% in 1999 and 4.4% in 2000, primarily as a

result of exports. Although the growth weakened to 2.2% in 2001, due to a slowdown in the global

economy, strong growth in Asia, a relatively weak baht and increasing domestic spending put the

nation back on the path to recovery in the subsequent years.

4. The Economic freedoms

Corruption and graft are widespread at all levels of

government and society amid unprecedented levels of

political instability. Before a May 2014 military coup

replaced the democratically elected government, the independent judiciary had been generally

effective in enforcing property and contractual rights but remained vulnerable to political

interference. Private property has generally been protected, but the legal process is slow.

5. Regulatory Efficiency

Forming a business takes almost a month, but no minimum

capital is required. Licensing requirements remain onerous.

Reform of the relatively rigid labor market has lagged. The

new military government imposed price controls and

expanded its power over state-owned enterprises (e.g., in the utility, energy, telecommunications,

banking, agriculture, and transport sectors) that account for more than 40 percent of GDP


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6. Open Markets

Thailand’s average tariff rate is 4.9 percent. Tariffs on

agricultural imports are especially high. The government

restricts foreign investment in many sectors of the

economy. The financial system is under strain caused by

political instability. Revisions in the Foreign Business Act, intended to open capital markets further to

foreign investors, have been largely cosmetic. The banking sector remains relatively stable.

7. Technology in Thailand

Thailand Number 26 in the Doing Business rankings, the country attracts not only tourists, but

investors from all over the globe, particularly in the area of information technology and

communications.

The IT and communications sector is expanding in Thailand and with the expertise of a highly qualified

workforce and an exceptional geographical position in the heart of Southeast Asia, Thailand is primed

for success.

Labor costs and the highly qualified workforce are the country’s strengths. The engineers develop

applications, computer software and smartphones for neighboring emerging countries where

demand is enormous.

Today, the electronic and computer sector in Thailand has the highest export value. It represents 20

percent of Thailand’s global exports, and provides jobs for almost 200,000 people in the country.

Another advantage for Thailand is its strategic position at the heart of the Association of Southeast

Asian Nations whose 10 members will next year forge an economic community, based on the same

principals as the EU. This free trade area will bring together 700 million people, making it an attractive

hub for global investors.

http://www.euronews.com/tag/thailand/

http://www.euronews.com/tag/business/


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(yozzo.com, 2015)

Global investors in information technology and communications continue to flow into Thailand.

Assisted by government incentives, the single business port, simplifies selling and administration

procedures. Help is also available to locate production sites or business partners. Add to that a wide

range of tax breaks and duty exemptions and everything is in place to keep investors happy.

In Thailand 97.6 million mobile subscribers in Thailand, which is a

penetration rate of 146%. The Thai market is predominantly prepaid

with 84,8 million prepaid subscribers. More than 99% of the market

share belong to three large operators (including their subsidiaries):

Advanced Info Service (AIS) who has a 46.52% market share, DTAC

with 28.50% market share, and True move with a market share of

24.26%. Other operators include the state enterprises TOT Public Company Limited (TOT) with 0.57%

market share, and CAT Telecom with 0.15% market share and Mobile Virtual Network Operators

(MVNOs). (wikipedia.org, 2015)


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7.1. Technology statistical

Thailand Mobile Subscribers 98.9 Million

Mobile Penetration Rate 146%

Smartphone penetration in Thailand is 52%

The sales of smartphones will grow by 29% to reach 20 million units

by the end of 2015

Internet Users in Thailand 23.86 million, penetration 35.8%

Internet Broadband 4.55 million users, 22.7% penetration per

household

Total 3G subscribers 82.3 million.

Total 4G subscribers 2.5 million.

Mobile data users 14.9 million (52%).

By 2017, mobile app download is expected to exceed 200 billion per year, and revenues will

reach $63.5 billion.

51% of Thai people ever purchase goods via smartphones.

Smartphone sales in Thailand are tipped to 12.5 million unit of the total 22 million in 2014.

(yozzo.com, 2015)

Thailand has the 3rd largest Facebook population in the world with 35 million users.

Bangkok has more Facebook users than any other city in the world with 20 million.

93% of Thai Internet users access Facebook every week, compared to 47% globally.

19 million, access Facebook through their mobile device

(yozzo.com, 2015)


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8. Thailand SWAT analysis

Investing and exporting products and services to new foreign markets is

becoming more and more popular.

Companies look for new markets, especially emergent markets which offer

new opportunities for investing and marketing their products and services

with low costs.

SWOT analysis can be used effectively to analyze the country’s position and capability in order to

determine the feasibility of the business opportunities.

Thailand , A fast growing domestic market, the high quality of the content industry including related

industries and human resources, a variety of film locations and facilities services, progressive overseas

development by domestic business entrepreneurs, some cases of ripple effect on tourism and other

fields are advantages. The relatively limited governmental resources available to assist private

companies, however, weak human resources development programs within the

Industry, many different regulatory government departments related to the content industries,

absence of established conditions of agreement for international cooperation are problems.

In the external environment, with an affluent population, high economic growth in a variety of fields

is expected. Growing spending power along with a growing middle class, the launch of terrestrial

digital broadcasting, economic integration in ASEAN scheduled in 2016 are positive factors for the

content industry. Low average GDP per capita, however, undeveloped broadband networks, unstable

power supply, the shortage of funding and staff in governmental support for the content industry,

insufficient measures in terms of tax incentives and other privileges offered to business

entrepreneurs, lack of legal enforcement to suppress copyright violation are problems.


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Str

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Fast growing domestic market.

The Thai economy is resilient and has weathered years of political turmoil much

better than most economists were anticipating. Overall GDP growth, exports, foreign

direct investment inflow and tourism have all outperformed most forecasters in the

public and private sectors.

Thailand is far ahead of other ASEAN countries in attracting foreign direct investment

into the automotive sector and supporting industries. It also has a good reputation

for attracting foreign investment in other export-oriented manufacturing industries,

from consumer electronics to sporting goods to processed foods.

There is a large supply of operator-level labor at a relatively low price. It is also easier

and less expensive to hire expatriate managers in Thailand than it is in most emerging

markets of Asia

High quality of digital content production, service equipment, post production and

manpower.

Good facilities services.

Cost of living consider not high.

Some major cases of ripple effect on tourism.

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Relatively limited resources to assist private companies from the government

including financing & academic support

Weak human resources development program

Political risks are likely to stay high until the new government demonstrates it can

withstand challenges from special interest groups, including the military.

Uncertainties will also stay high until the country demonstrates it can manage a

succession in the monarchy without experiencing political turmoil or social unrest

One of the casualties of the political turmoil and increase in the military’s role in

politics is that Thailand has changed from having one of the freest media’s in Asia to

having one of the most censored.

The crackdown on on-line political discussion over the Internet has been especially

severe. The reputations of other institutions like the judiciary have also be damaged.

Energy costs in Thailand are relatively high, and the country is lagging behind others

in Asia in putting in the latest telecommunications technology.

The supply of skilled technical labor is less than in other countries covered here with

the exception of Indonesia and the standards of spoken English are the worst of any

country covered here. It can be difficult to recruit and retain experienced, skilled

Thai labor.

One of the biggest drawbacks to Thailand is its bureaucracy. It can also be difficult

getting cooperation between different government departments.


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Following chronic shortages in recent years and an import-driven power economy,

Thailand has huge potential for solar power and other “green” power technologies,

which can be used to address rising power demand.

The recent increase in labor unrest and rising wages in China will give Thailand a

chance to market itself more as an alternative investment site for foreign companies.

Most of the policies reforms the new government has announced should put more

money in the hands of average Thais and help stimulate consumer spending, which

has depressed in recent years by social turmoil and political uncertainty. The new

government’s policies could create new local market opportunities at a time when

export prospects have been damped by adverse global developments.

Recently announced measures to improve agricultural productivity should, if

implemented, will bring new skills, investment and other resources into neglected

areas raising local incomes and business activities.

Under China-ASEAN free trade agreements, China is required to open up wide areas

of the services sector to Thailand and other ASEAN members. That will provide fresh

opportunities to Thai firms in several sectors such as legal services, finance and

accounting, telecommunications, education, tourism and logistics

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Political risk is the dark spot in Thailand’s otherwise stable business environment.

With it comes a string of other issues, such as the reliability of policy continuity,

especially concerning infrastructure investments, and excessive military spending

that is diverting financial resources away from what should be higher priorities.

The size of the public debt could become a bigger problem if the new government is

as aggressive in in spending policies as it has indicated it wants to be.

Terrorism threats are increasing in the south of the country.

Problems in the US, Japan and the EU could hurt the growth of Thai exports and

cause some foreign investors to have second thoughts about going ahead with

planned disbursements in Thai projects.


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Morocco vs. Thailand

The below comparison will summarize all previous figures and numbers,

throughout the comparison items we can shape a solid vision of the

business opportunities in Morocco and Thailand.

Facts

Continent Africa Asia

Capital City Rabat Bangkok

Government Type Constitutional Monarchy Constitutional Monarchy

Member of the United Nations GDP $104BILLION $387BILLION

GDP Growth Rate 4.38% 1.77%

Figure 6 (GDP Growth Rate)

(heritage.org,2015)

GDP Per Capita $3,092 $5,778

GDP Per Capita Growth 2.81% 1.42%


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Figure 7 (GDP Per Capita)

(heritage.org,2015)

Unemployment Rate 9.2% 0.7%

Figure 8 (Unemployment)

(heritage.org,2015)

Inflation Rate 0.4% 1.9%

Inflation GDP Deflator 1.0% 2.8%


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Figure 9 (Inflation) (heritage.org,2015)

Gini index 40.88 39.37

Total Population 33MILLION 67MILLION

Median Age 27.7 years old 35.1 years old

Average Sex Ratio 0.97 male(s) per female 0.98 male(s) per female

Population Below Poverty Line 15% 7.8%

Literacy Rate 67.08% 96.43%

Internet Users 56.00% 28.94% Table 1 (Morocco vs. Thailand)


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Evaluation of potential

Smartwatch

1. Definition

A smartwatch is defined by three characteristics:

Worn on the wrist

Able to indicate time

Able to wirelessly connect to the Internet

(wikipedia.org, 2015)

2. The History of Smartwatches

First wristwatches evolved at the end of the 19th century, becoming hugely popular. In the

1940ies, people started to imagine that watches could do much more than indicating time.

Based on the electrification of watches in the 1970ies, various companies started to build

smartwatches in the 1990ies. But it took another two decades to make them a commercial

success. (smartwatchgroup.com, 2015)

a. Foundation

Stationary watches appeared in the 15th, pocket watches in the 16th century.

However, minimizing and adapting the components to produce wrist watches took

another few centuries: The first such watch was produced by Patek Philippe in 1868

(some argue that it was Breguet in 1812). Another Swiss watch manufacturer – Girard

Perregaux – commercialized wrist watches with an order by the Germans to equip

their solders with wrist watches in the First World War.

The technology improved dramatically over time. Rolex introduced the first

waterproof watch called Oyster in 1926 and shortly thereafter self-winding

watches, Breitling launched first stop watches in 1930. New materials, better

production methods, improved designs, and new complications were responsible for

a steady stream of innovation. However, the indication of time is at the core of

mechanical watches until this day. (smartwatchgroup.com, 2015)

http://www.patek.com/

http://www.breguet.com/

http://www.girard-perregaux.com/

http://www.girard-perregaux.com/

http://www.rolex.com/

http://www.breitling.com/


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b. Imagination

As wrist watches became more and more popular, people started to imagine that a

watch could potentially do much more than indicating time. Intelligent watches were

an important element in various films and series such as Dick Tracy (1940ies), Star

Trek (1970ies), Knight Rider, and Inspector Gadget (in the 1980ies).

Even more famous may be the various smart watches James Bond used in his films. A

Samsung commercial made in 2013 provides a nice impression of the imagination

phase. (smartwatchgroup.com, 2015)

c. Electrification

After projects by Japanese, US, and Swiss companies starting in the 1950ies, the first

digital watch called Pulsar was introduced by Hamilton in 1970. Smiled at first, the

new technology almost put conventional watch companies out of business. Quartz

watches were not only cheaper, they were also more precise than mechanical

watches.

In the 80ies, Intel produced first LCD watches, and companies like Casio and Seiko

produced watches with built-in databases, dictionaries, blood pressure sensors,

touch screens and even gesture control. While most of these functions did not have

big markets, the quartz watch was there to stay. After some reluctance, even the

Swiss jumped on the bandwagon: Swatch now belongs to the world’s most successful

watch manufacturers.

Within the same period, Internet and mobile phone technologies started to emerge.

Both are critical technologies for the periods to follow.

(smartwatchgroup.com, 2015)


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d. Experimentation

With the advent of mobile phones, various companies started to think about new

form factors for the technology. AT&T patented a wrist phone in 1993, and various

companies started R&D activities in the 1990ies. Samsung launched its first product

in 1999. IBM developed a watch with built-in Linux, Bluetooth, fingerprint reader, and

accelerometer. But as the Swatch Group – which built a phone-watch in the late 90ies

they never brought the technology to the market.

Initial euphoria quickly lost ground to the insight that the technology was too clumsy

for a successful consumer device. Several product launches in the years thereafter –

incl. Fossil’s first Wrist PDA in 2001, Microsoft’s SPOT smartwatch in 2004, Sony

Ericsson’s NBW Series in 2008, and the LG Watch Phone GD910 / Samsung GT-

S9110 in 2009 – remained unsuccessful.

However, due to the incredible advances in the mobile phone industry, needed

hardware components became smaller and smaller. Plus, due to the introduction of

smartphones, a fast mobile data network was built up globally.


e. Commercialization

The Kickstarter-Campaign by Pebble was the starting point for the commercialization

of smartwatches. In a crowdfunding campaign in 2012, the unknown startup company

raised more than 10 million USD by selling 70,000 smartwatches within little more

than a month. Thousands of media articles brought the almost forgotten technology

suddenly back into the spotlight. Samsung reactivated the R&D programs followed in

the decade before, and dozens of other companies started the quest to secure parts

of what seems to become a large industry over the years to come.



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Apple Watch

With the increase of brands in the market of smart watches the intensity of the competitors is

very high in this market. As all the brands are trying to introduce the better product in order to

compete in the market therefore, the competition is increasing.

Similarly, iWatch is also facing competition from different leading

brands in the market offering unique features. Though Apple has a

high brand image, but it is also facing huge competition regarding

the smart watch market. The different brands are competing over

the offers they are providing such as the innovation, user

friendliness, unique options and many more features, other than that, the prices of the smart

watches play a vital role in the competition. The brand which provides the best features win the

competition and hence, have an edge in the market. Many leading brands in the market which

provide the smart watches are focusing on the integration of the smart watches with the

smartphones and tablets, GPS navigation system, attractive designs, strong battery and also third

and fourth generation. The prices of the smart watches vary from $189 to $400.

1. Apple Watch vs. Others

The key competitors of Apple iWatch are following:

Moto 360

Moto360 by Motorola is one of the smartwatch which can compete with

the Apple iWatch. Almost all the smartwatches currently offer the square

and rectangular shape and does not offer other shapes. Moto 360 took the

advantage of that and is offering a circular shaped smartwatch that is

having the Android Wear’s support. It possesses the high-tech features

other than the traditional wrist watch that gives it a competitive advantage

in the market. The price is expected is to be in $249, Moto 360 can be a hot seller and also the

real competition for Apple’s iWatch.


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Samsung Gear Live

Samsung Gear live is third major smartwatch which was released last year such

as the Galaxy Gear which was followed by Gear 2. Samsung is releasing different

design smartwatches to stay in the competition. The Gear Live is featured with

Android Wear and due to this it is gaining valuable exposure in the market. Gear

Live can be integrated with the Samsung’s smartphones like Galaxy S5, and also

it is best suited for the large consumer base of Android. The price of Gear Live is

as minimum as $199.9, giving it competitive advantage over the expensive smartwatches in the

market.

LG G Watch

G Watch is one of the first two watches that was supported by Android Wear

and it is better looking of the two. LG G Watch is one of the first watch which

basically targeted women via its advertisements and this gives it a

competitive edge. Moreover, the price of G Watch i s $229; it comes in a

traditional Black Titan case and offers all the functionality of the Android

Wear. LG is offering the slim design and also focuses on being the

fashionable accessory. It is available in attractive colors and it is compatible with the standard

watch straps. Other manufacturers of the smartwatches are focusing on technology aspects and

innovation, but LG is mainly focusing on fashionable design and wants to compete with Apple

iWatch via its fashion strategy.

Pebble Steel

Pebble realized the increasing competition of the smartwatches therefore, it

introduced its smartwatch in 2014, having price of $249 named as Pebble Steel.

It might not look as a threat for Apple iWatch, but it offers a mature look and also

it has many apps, long battery life, easily readable display in the sunlight and also

its compatibility with the Android Wear and iOS. Thus, it can be a competition for

Apple iWatch.


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2. Smart Watches, PROS and CONS

Facts PROS CONS

apple Watch

Lift your wrist and the face will light up. When you aren’t using it the screen will be black (most likely in a type of “power save” mode)

Lots of bells and whistles such as a sketch feature and displaying your heart rate

Watch face and bands available in 2 different sizes

Customizable watch faces Tracks your fitness via the Activity

app and includes an accelerometer and hear rate sensor

Use the watch as a remote for your smartphone camera

Highly wanted, on backorder iOS (Apple) only

Moto 360 Microphone equipped for voice commands

Charger doubles as a clock for nightstand

Activity tracker capabilities to track your heart rate, steps, distance and calories burned

Get directions to a location Weather, flight and traffic

notifications Moto Maker lets you customize your

watch

Android only Battery lasts only 1 day No camera capabilities

Samsung Gear Can play music without phone Capability to act as TV remote Fitness tracker Heart rate monitor Find My Phone feature Draw emojis WiFi

Short battery life (1-2 days) Only compatible with Android

Galaxy


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LG Watch Customizable Accelerometer Compass Barometer Heart rate monitor GPS Draw emojis WiFi

Can’t be used with iOS

Pebble Inexpensive compared to others on the market

7 day battery life Pebble app store allows a

customizable watch face Easy to read watch face in both

bright and dim environments Fitness tracker capabilities Supports Android wear Pebble Time has an e-paper look

Inexpensive compared to others on the market

7 day battery life Pebble app store allows a

customizable watch face Easy to read watch face in both

bright and dim environments Fitness tracker capabilities Supports Android wear Pebble Time has an e-paper look

Table 2 (Smart watches-Prons and cons)

(werockyourweb.com, 2015)

3. Smart Watches, Tech Specs and Price

Facts Tech Specs Price

apple Watch

Use the watch as a remote for your smartphone camera

Retina display iOS only

6 different straps in various colors

3 different styles: Apple Watch, Apple Watch Sport and Apple Watch Edition

Price is not available yet but rumors suggest the following:

Sport model: $550 Stainless steel and sapphire

crystal model: $1,100 Gold version will be in the

thousands of dollars range

Moto 360

Call, text and email notifications Compass Camera capabilities for an extra

charge iOS and Android compatible

$249.99*


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Samsung Gear

Make and answer calls Camera Android only

Gear Live – $199.99* Gear 2 – $299.99* Gear S – $384.00*

LG Watch

Android only

$349

Pebble

Call, text and email notifications Compass Camera capabilities for an extra

charge iOS and Android compatible

Pebble – $89* Pebble Steel – $199* Pebble Time – $199* Pebble Steel bands (stainless

steel or matte black) – $20* PebbleCam – $2.99*

Table 3 (Smart Watches - Tech Specs and Price) (werockyourweb.com, 2015)


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4. Smart Watches Ranking

The top performers in review are the Apple Watch.

Figure 10 (Smart Watches Ranking) (werockyourweb.com, 2015)

5. Apple Watch SWOT analysis

Apple iWatch has several strengths which can take it to the peak of success such as the brand

awareness of the product is great strength for the company. Apple iWatch can cope up with the

weaknesses as it has the opportunity of creating whole new product category, whereas, the threat

for Apple iWatch is the new smartwatch introduced by Samsung.


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Str

en

gth

s

A beautiful smartwatch If you use other Apple devices, the Apple Watch will seamlessly tie them all

together into one easy-to-use gadget. Never miss a phone call, email or text message again with phone notifications

sent straight to your wrist. Core feature, this smartwatch takes a complete portrait of your biometric

variables. Varity size and style to match any one. Two sizes (38mm and 42mm) are available

in three model options (standard, sport and gold) with various wristbands. Communication is over Bluetooth and Wi-Fi, regardless of where your other

devices are in the house. Health tracking, communications and device control form the complete Apple

Watch experience, giving you access to all things digital from your wrist. Now at your beck and call from your wrist. No more taking out your phone to

chat with your virtual personal assistant. Brand equity – Apple is one of the top most companies of the world for its brand

equity. From the days of McIntosh computers, Apple is known to be a brand with promise.

Amazing software and OS – The IOS which is the operating system of Apple Watch is a respected platform because of its flexibility and speed. The user interface is fantastic, and one you use an Apple Watch, you get addicted to its ease of use.

We

akn

ess

es

less immediately user-friendly than most Apple products Apple Watch will require daily trips to the power adapter to recharge. High price, the price ranges from expensive ($550) to prohibitively expensive for

the Apple Watch Edition (starting at $14,000). All of your iPhone notifications are visible for all and sundry to see on your wrist. You will need to pair this watch with an iPhone to access location tracking and

internet services, like email. Hold onto that waterproof sports watch you bought to track your swim sessions:

the Apple Watch is only splash resistant. You can’t wear the watch while it charges at night, so forget sleep tracking.


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Op

po

rtu

nit

ies

Smart Watches are the rage nowadays and the market is not going to get smaller.

Thus the large market of potential customers is there for the taking for a brand like Apple.

People are becoming more and more addicted to internet and apps. So much so that future hardly anyone is seen without a Smart Watch. As people become more digitalized, and as spending power increases amongst consumers, Smart Watch like Apple Watch Will see a boom in the industry.

Till date Apple Watch is selling only in urban areas. But there is bound to come a time when Apple Watch will look towards geographic expansion. At that time, the opportunities will grow even further for Apple Watch because there is a lot of market pending to be covered by Apple Watch.

The accessories market is never ending, and the more company accessories that Apple manufactures, the better profits they will get from return customers. Because accessories in general give very good margins.

Th

reat

s

The single biggest threat to Apple Watch is the Android operating system. Google

has taken the world by storm due its operating system and android is poised to grow even further because it is free for all.

Another threat to Apple Watch is Samsung with its large arsenal of smart watches coming in all shapes and sizes. Samsung had really shown the world the power of android and has brought android OS in cameras as well. Thus Samsung us the biggest competitor for Apple Watch.

Lack of innovation – In past few years, Apple has not brought any new product in the market and people expect Apple to come out with innovative products. This lack of new products might become a threat to the followers of Apple Watch.

Threat of brand Apple losing its shine – With no innovation in last few years, and no Steve Jobs, there is a slight threat that the brand Apple might lose its current brand equity over a period of time. If Apple launches a single innovative product in the coming years, then again the brand value will go up. However to maintain the brand equity, Apple has to keep shining, else it will fade.


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Evaluation of the business potential for new iWatch in Morocco and

Thailand.

1. Smart Watches, Worldwide market.

In its first quarter on the market, the Apple Watch already dominated global smartwatch sales.

While Apple did not break out Apple Watch sales in its latest earning report, analysts are

estimating that the company sold between 2.5 and 4 million watches between its release in April

and the end of June.

According to Strategy Analytics, which pegs Apple Watch sales at the high end of that range, Apple

accounted for more than 75 percent of global smartwatch sales in the past quarter.

Figure 11 (Top10 smartwatch manufacturers by unit sales in 2014) (statista.com, 2015)


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Apple’s rise from non-competitor to market leader speaks volumes of the company’s marketing

power. Despite many other smartwatches being available long before the Apple Watch, it took

the appeal of the Apple brand to take smartwatch sales to another level.

Figure 12 (Smartwatch shipments in Q2 2015) (statista.com, 2015)

The latest update to IDC’s worldwide quarterly wearable device tracker puts Apple ahead of the

pack with 4m Watches sold in the second quarter of this year. The next biggest smartwatch vendor

was Samsung, with 400,000 of its Gear smartwatches sold, which makes Apple’s sales six times

greater than its closest rival.

Apple’s success in the smartwatch space will be measured in how many people buy the second

and third generation devices over the next few years, after the novelty has warn off and the early

adopters have already bought their devices. Only then will Apple Watch’s impact outside the tech-

geek niche be clear.


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2. Smart Watches, Thailand market.

a. Thailand Operating Systems (OS) Market Share, Usage Statistics – 2014

Figure 13 (Thailand Operating Systems (OS) Market Share)

b. Market share Thailand smartphone 2014

Figure 14 (Market share Thailand smartphone)

Windows83%

OS8%

Android3%

Linux1%

Other5%


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3. Operating Systems, Morocco market.

Figure 15 (Operating Systems (OS) Market Share)

4. Market share Morocco smartphone 2014

Figure 16 (Market share Morocco smartphone)

Windows91%

OS3%

Android2%

Linux1%

Other3%


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Evaluation of the potential demand for the Apple iWatch

Apple broke quarterly records with $10.7 billion in profit and $49.6 billion in revenue, compared to

$7.7 billion in profit and $37.4 billion in revenue in Q3 of 2014. Its gross margin was 39.7 percent.

These results easily beat Apple's guidance for the quarter, which predicted revenue between $46

billion and $48 billion and profit margins between 38.5 and 39.5 percent. (macworld.com, 2015)

Figure 17 (Revenue and profit Q3 2014 VS Q3 2015) (apple.com, 2015)

Figure 18 (Revenue by operating segment Q3 2014 VS Q3 2015) (apple.com, 2015)


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About two of every three smart wearables shipped this quarter was an Apple Watch, The demand for

smartwatches is relatively tiny, but it's growing. Global smartwatch shipments grew by 457% annually to

hit a record 5 million units in the second quarter of 2015, according to (StrategyAnalytics.com, 2015). Of

those 5 million watches shipped, Apple accounted for 4 million of them, giving the company 75% market

share, the research firm reported.

Figure 19 (Apple Q3 2015 Revenue) (apple.com, 2015)

The rate of growth reflects not only Apple entering the market but an increase in market awareness.

The increase in shipments in the quarter was the fastest growth the industry has ever experienced

with the volume exceeding the 4.6 million smartwatches shipped in all of 2014.

Apple is setting the tone and crushing competitors including Samsung, which Strategy Analytics

estimated shipped 0.4 million smartwatches in the quarter despite having its watches on the market

longer.


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Apple predicted to sell 'iWatch' to at least 10% of

existing iPhone users in 2015 , market watchers

have begun to speculate exactly how many wrist-

worn devices the company could sell, with one

new projection pegging the device with at least 10

percent penetration among iPhone users in the

first full year.

With an estimated active iPhone installed base of 335

million users by the end of 2014, analyst Keith Bachman of

BMO Capital Markets believes Apple could sell at least 33.5

million of a so-called "iWatch" in calendar year 2015.


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Country choice:

Based on market analysis of Morocco and Thailand, I chose Thailand to launch Apple iWatch

successfully.

I chose Thailand to launch Apple iWatch

Mohamed Ali Salem

17/9/2015


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Choosing the Right (and Most Profitable) Market for Apple Watch, if spend too much time focused on

Apple watch and not enough time on finding the right market opportunity we will lose a lot of

investment. Without the right customers, we won't have revenues, profits or much chance of success.

It's important to determine if we are going after the right market or we need for more analysis to

determine it.

On a way to determine the right market for apple watch we have to find out a solid answer of the

following question.

How many customers are in the market?

Determine the targeted customers depends on the product’s value, As per Keach (2014), the

watch would likely to be compatible with just the recent additions of iPhone 5 & 6, hence this

itself has led to narrowing down of apple market share of the new product. However it can

be treated as treat for the more loyal customers of the brand. As per Solomon et.al (2012),

segmentation can be broadly categorized on demographic, psychographic and behavioral

attributes.

Deep diving into the demographic variables, we can see that age and income social groups

can be considered as one of segment variables. The features provided with the iWatch has

more emphasis on healthy lifestyle and reminder of health routines, it also acts as an on the

clock heart monitoring device (Apple, 2015). The features embodied within the product will

tend to attract the younger to medium age range (16-40 years). The price indicated would be

expected to be 300 pounds and above (Suleman et.al, 2015). As indicated by macrumors.com

(2015), the price of the product will only increase to more than triple its start rate with taking

a more expensive variant. Indicating a medium to higher income social groups.

Also owing to the new category intrusion within the Apple Company, the customers willing to

have an inclination would mostly reside towards the Innovators category with likely hood of

achievers and experiencer’s willing to make purchases and have impact by media

(strategicbusinessinsights.com, 2015).

Regarding to the above points and below comparison we can note that Thailand has a greater

chance than Morocco.

Facts

Total Population 33MILLION 67MILLION

Median Age 27.7 years old 35.1 years old

Internet Users 18,480,000 19,389,800

Apple iPhone Users 6,864,000 12,060,000


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Total number of iPhones in use in Thailand is 12,060,000, as Apple predict that the selling of

iWatch will be at least 10% of iPhone users. It means that Apple will sell 1,206,000 of Apple

iWatch.

Can these customers pay for your products or services?

The purchasing power of consumers is directly proportional to the economic conditions in the

country. (Jeynes, 2013). The aspects needed to be considered here are the interest rates,

inflation employment level and future Gross Domestic Product (GDP) per capita (Friesner,

2014).

Facts

GDP Growth Rate 4.38% 1.77%

GDP $104BILLION $387BILLION

Gini index 40.88 39.37

Population Below Poverty Line 15% 7.8%

Unemployment Rate 9.2% 0.7%

Of previous figures, we find Thailand is superior to Morocco in all rates so the Thai market in more

promising than Moroccan market.

Determining targets

1. Expected sales of iWatch: Apple predicted that they can sell 12,060,000 piece of iWatch in Thailand in 2015.

Figure 20 (Expected sales of iWatch in Thailand)


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2. Target: Segmentation of markets and customers:

Based on the potential market segments as discussed above, we will need to evaluate the market

segment, develop their profiles and finally choose marketing strategy (Solomon et.al, 2012)

The Thai market potential is growing with current share

being 18% of apple iPhones, however the market share

of Android users remains high at 45.4 %. With strong

competitor base already established in the market for

smart wearable watches with Samsung, Motorola, LG

and Microsoft, the demand of apple watch will boom in

the market (Griffiths, 2014). As per Keach (2014), the

estimated sale of Apple watch can be approximated to

40 million units on first year.

Having established the potential of the market segment

for Thai consumers as per the evidence, it is safe to say that the demand will be more towards

the existing apple users where loyalty of brand can be expected.

The typical segment profile that is developed from the evidence must be a young to average age

individual between 16 to 40 years, falling in a medium to slighter higher income social group who

is willing to take chances with choices provided. This will also lead us to select the differentiated

targeting strategy to have a grasp over different consumers that can lead to diversify the product

profile in market (Solomon et.al , 2012).

These are the potential market segments that Apple Inc. is likely to make profits.

Segmentation Variables

Geographic Country: Thailand , from the north to the South Big cities: Bangkok. Chiang Mai. Hat Yai. Khon Kaen. Nakhon Ratchasima. Nakhon Si Thammarat. Nonthaburi. Pak Kret.

Demographic Age: 16 - 40 Gender: Unisex Income: Affluent Education: High school, college graduate, professionals

Psychographic Social class: White-collar worker Lifestyle: Busy Personality: Adore luxurious products


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Target segment in points:

Average age between 16-40 years old.

Higher income social group

People are obsessed With Apple Products

Use technology to feel empowered.

Fashion conscious.

Proud to be an apple user.


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Strategy of marketing plan

1. Product Positioning:

Positioning Apple iWatch in the market is basically analyzing the competitors in the particular

market segment with respect to its competitors. Developing a market strategy with the right mix

in order to attract these customers must be of the essence (Solomon et.al, 2012)

Analyzing the main competitors “Samsung “.

The category of smart watches is fairly new with electronic

companies launching devices in 2014 and many devices catering to

work with Android software. (Martin, 2015). The market share of

Android users remains high at 58.2 %. With strong competitor base

already established in the market for smart wearable watches with

Samsung

The highest advantage of Apple watch is its personalized setting experience that bring customer

closer to the product, however the significant difference in price range (Martin, 2015) between

Apple watch and the others may not compel customers towards them.

The competitive strategy for Apple watch with respect to placing itself in market is to provide a

more personalized experience to the market segment and since Apple is already considered as a

status symbol, the main focus is to market the product to brand loyal customers.

Since the product itself is a new category for Apple as an organization and its potential consumers,

the launch of it can pose many challenges to its approval in the market. Although we have

segmented this product within the consumers of medium to high income consumers, the sheer

high price of the product may not attract the choice to be within the medium income group with

many other consumers like LG and Motorola offering similar category product at competitive

price. Also the choice for this product is further minimized within its consumers to those already

using apple phones or consumers who plan to purchase the newest generation iPhones.


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2. Marketing Mix

In terms of providing the product or service to the customer, we

must to plan out the best set of characteristics to attract

customer and as noted by Solomon et.al (2012), a single

marketing activity does not work to attain the organizations

objective. Hence the independent attributes of product, price,

promotion and place sets the target to gain that objective

(Solomon et.al, 2012)

1) Product

Product classification

Apple Watch is a Consumer Product and is classified as Specialty Product. To illustrate,

Apple’s products have been seen as unique and desirable. Furthermore, the customers

are truly willing to purchase Apple Watch due to high-end electronic device and

fashionable smart watch.

Three levels of product

The Apple Company has designed the watch by keeping in mind the vast extend of

consumers and their options. With 3 variants of main choices customer can choose from

a casual, sporty and elegant look, the 2 different size options provided has been given the

customer the flexibility to wear his/her favorite shape, The vast variety of straps provided

makes this appeal to a whole lot of consumers seeking a much more fashionable

approach, with the option of interchanging straps.

Core benefits:

Apple Watch definitely has the basic functions as same as all other smart watch such as

timing, calling, texting and so on. Furthermore, Apple Watch also can capture images,

record videos in High Definition and other useful Applications.


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Actual product:

The Brand Name of Apple is really famous in the world. Furthermore, Apple Watch has

reached the standard of quality in US. Besides that, several high technological functions

have been applied in Apple Watch. Moreover, the great design of Apple Watch makes

customer more professional and fashionable.

Augmented product:

Apple Watch, like many other Apple’s products, has a Complimentary Support, which

provide technical support within the first 90 days after purchasing the product. The

customer who purchases the Apple Watch also receives Apple’s One Year Limited

Warranty. Finally, the service center is available in the world.

2) Price

Prices

The current prices of Apple Watch are high compared to the normal Thai living standard.

Pricing strategies

Market Skimming pricing strategy may not be effective in Vietnam because the number

of people who are willing to pay for the Apple Watch with a high price is not high. These

people are usually upper class only.

Product-mix pricing strategies

The Product line pricing strategies (based on different capacity) that Apple is using could

be useful. As a result, the customers have more options to buy depend on their financial

situation.

Price-adjustment strategies

Apple uses psychological pricing for Apple Watch. Thai people tend to think that the more

amount of price they paid, the more quality they gain.


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Type of market

Apple Watch is in Monopolistic competition market. To illustrate, besides Apple Watch

there are several smart watches in the world such as Samsung Gear, Moto 360 and LG

watch.

Price elasticity of demand

Apple Watch has inelastic demand. This means that even if the price for an Apple Watch

increased steadily, the demand will not change much. The reason is that Apple Watch is

a specialty product that has high quality and attracts a large number of Apple’s loyal

customers.

Current price

Although the exact pricing of the Apple watch is not yet been disclosed as on Jan 1st week

2015, it is estimated to be 550 $ with the basic edition and spring up to 3500 $ with its

high end collection that is gold plated according to Allsopp (2015). This being said, the

Apple watch will be the most expensive smart watch compared to any of its competitors.


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New-product pricing strategies

Apple used Market Skimming Pricing for Apple Watch. In other words, Apple initially sold

Apple Watch with high prices. This strategy could have been done because of the high

quality of the products. Moreover, the large number of Apple’s customers who wanted

to quickly obtain the new smart watch version. Furthermore, the brand name value is

high.

Product-mix pricing strategies

Apple applies Product line pricing strategy for Apple Watch. This means that Apple set

different prices for different models of Apple Watch.

Price-adjustment strategies

Apple uses psychological pricing for Apple Watch. In other words, customers will pay

more price for Apple Watch if its quality and usability is pretty good to compare with its

competitors (Kolter et.al., 2009)

Competitors’ prices and pricing strategies

Apple Watch has a few competitors from different companies in the smart watched

market such as Samsung Gear, Moto 360 and LG watch. The competitors’ prices are

around the same as Apple Watch due to them also applies an almost similar pricing

strategy.

3) Promotion

Promotion is about letting the potential consumers make aware of the product in order

to motivate them to purchase the product or service (Solomon et.al, 2012)

Promotion of any apple product is a big task and the Apple watch unveiling done at an

international scale by Tim cook CEO of Apple Company in USA earlier in September

2014(Times, 2014). Apple uses social media to gain attention of consumers and their

much detailed video available on YouTube shows every minute specification of the watch.


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The key takeaways from their promotion strategy are that the company shows the value

added by product to the lives of individuals by making the product accessible, relevant

and personal choice of consumers. It also focuses in embracing individuality and that main

focus of the watch is to inculcate a much healthier lifestyle with features such as fitness

tracker.

Advertising

Apple’s advertising objectives for Apple Watch are both informative and persuasive. The

advertisements inform customers of Apple Watch new features and persuade them that

it is the most amazing smart Watch.

Apple’s advertising message for Apple Watch is that the Apple Watch can perform much

better than competitors with more advanced technology. The creative concept for Apple

Watch advertising involves the demonstration of its features. Apple also uses different

types of message execution, which are slice of life, lifestyle, mood and image, technical

expertise. Finally, Apple chooses many different media to deliver its advertising campaign

for Apple Watch. The most notable media are the Internet and television.

Sales promotion

Apple does not really focus much on sales promotion. The only sales promotion tool that

Apple uses is point-of-purchase promotion, which includes demonstration of the products

in the reseller stores.

Personal Selling

Apple does not use personal selling.

Public relations

Apple has been using Public Relations to promote the Apple Watch. Apple mostly uses

press relations.

Direct/ online marketing

Apple does online marketing


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4) Place

This part of marketing mix focuses on making the product available to customer at desired

location at the right time. It mainly focuses on the supply chain of the product. (Solomon

et.al, 2012)

Apart from Apple store and general retailers selling the product, attention must be given

to easy and quick availability of the product with its accessories in the online market for

Thai consumers.

Marketing Channels

Apple uses indirect marketing channel to sell Apple Watch. The intermediaries are many

resellers worldwide.

Channel organization

Apple implements Vertical Marketing System in a form of Contractual Marketing System.

Different smaller companies sign contracts with Apple to establish Apple Reseller shops

to sell Apple’s products.

Marketing Intermediaries

Apple hires industrial distributors to establish Apple Premium Reseller stores and

manufacturer’s agencies for other Apple products’ selling locations. The Apple Watch is

sold via both industrial distributors and manufacturer’s agencies.

Apple uses Selective Distribution strategy to choose the number of its intermediaries.

Only a selective number of distributors can sell Apple’s products include the Apple Watch.


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Marketing activities to launch the Apple watch in Thailand:

1) Objectives

Corporate Objectives

To achieve the largest market share in the smart swatches industry of Thailand.

To build long-term business relationship with the local distributors.

To provide the consumers the best offer with high quality and reasonable prices.

Financial Objectives

To increase earnings per share by 25%.

To increase the operating cash flows by 37.5%.

To increase the company’s profitability levels.

To provide a Return on Investment of 15% by the end of 2015.

Marketing Objectives

To enlarge the market segment for Apple Watch after 4 months.

To overthrow Samsung Gear and establish Apple Watch as the market leader

after 4 months.

To gain 15% market share from smart swatches business by the end of 2015.

To increase the customer’s awareness by 30% by the end of this year.

2) Marketing mechanism.

Advertising:

There should be a local version of Apple Watch advertisement appearing usually on Thai

television channel such as Channel 3, Modernine TV and Thai Public Broadcasting Service.

This should take the Thai lifestyles and values into consideration. The advertisement should

also be on local daily newspapers (Bangkok Post, Chiang Rai Times, and Thai Rath etc.) to

widen the effect.


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Sales Promotion

Apple could use some consumer promotion tools to increase the Apple Watch sales.

Apple Inc. should apply Advertising specialties. To illustrate, when customers

purchase Apple Watch, the stores should give them some gifts (helmets, umbrellas,

etc), which contain the logo of Apple Inc. to spread out the fame.

Apple Watch also can apply coupons (decrease 10%) for other products of Apple

Inc. such as iPod, iPad and iMac to increase to purchasing power of customers.

These methods also have positive influence in terms of Thai customer’s attitude

toward the Apple Watch brand.

Public Relations

Apple could continue using its current Public Relations strategy for Apple Watch in Thailand.

Furthermore, social networks such as Facebook and Twitter are also effective to advertise

Apple Watch for customers.

3) Marketing activities.

1) Launch event

"Sometimes an event can provide an environment that is unique to the product use,"

Dickinson says. "It can be quite powerful."

Developing a new product in a new category is a formidable task, but actually launching

the product when it's ready for the market can also be one of the most stressful times for

a business owner. New products can earn about half their sales and profits far earlier in

the product life cycle than many business owners realize.


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To launch Apple Watch and take the proper attention we can conduct a launch event to

introduce Apple Watch to the Thai society, with the introduction of the Apple Watch, I

expect wearables to grow exponentially as an electronics category in Thailand.

2) Web Ads

Web ads or banner ads can be one of the most famous

and cheaper in order to target the large populations,

these ads can be refined to give some added results if

done correctly. Look for localized sites, such as minor

league sports teams, local news sites, or any other site

whose traffic would generally be limited to local

guests.

3) Television Ads

Television advertising has long been one of the most powerful yet

most expensive advertising mediums available. There are still

a lot of opportunities out there to gain customers. Because

of these recent changes, television stations and cable

companies have done a lot to continue to provide their

advertisers with responses. Many local news stations push

Tim Cook introduce the Apple Watch


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their own websites that can work in conjunction with a television commercial. This

provides us with branding opportunities through traditional commercials and an online

presence on a local station–backed website. Cable companies offer numerous

sponsorship spots and demographic-specific channels at astoundingly low rates.

I prefer to hire one of celebrity to be the main actor of the television campaign like Dome

Pakorn.

(Dome Pakorn Thai Actor)

4) Radio Ads

Like television, radio has taken some hits as far as its effectiveness

due to recent technological advances. MP3s, satellite radio, and

Internet stations have taken some of local radio’s listeners, but

it is still a good way to generate results. Radio operates in a very

similar way to television. Spots are priced based on ratings, and

frequency is key.


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5) Social Media Ads

Social media advertising has come a long way in a

relatively short period of time. When Facebook

launched its first advertising option in May 2005,

no one could have predicted that social media

advertising revenue would be estimated to reach

$8.4 billion in 2015, just ten years later.

Social media advertising helps businesses find new potential clients by using users’ own

shared information to identify interest. Rather than reactively targeting users who search

a certain term, social media advertising proactively targets relevant users before they

even begin their search.

Social networks are a good option for advertisers because of the advanced targeting

options, reliable conversion tracking, and prevalence on mobile devices.


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Conclusion

The marketing analysis of the product, starting from the external environment analysis, its consumer

analysis, the competitor’s analysis, customer’s perception of the product in comparison and having

identified the marketing mix of the product, I have suggested some measures that can be made within

the product that will help us enhance our market share and help diversify the product.

Some of the challenges mentioned in the report with the product related to late entry in market, high

price of product, proportion of market that can be expected to use the new product and challenges

related to compatibility, however the product might be able to overcome these challenges with its

superior functional characteristic and applications, but effort must be made to make the product to

be used by the masses that can lead people to gain confidence in Apple products and become loyal

customers in the future.


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