The Product Life Cycle of the iPhone Minimal

iPhone minimal: A Proposed Product for the Southern Asia and Indian Market

iPhone minimal is a proposed product specifically targeting the Southern Asia and Indian market; to meet needs of the consumer base in the said areas, that is, low income and low-tech literacy. The product has a life cycle constituting five main stages; product proposal, project start-up, development and market expansion, maturity, and exit (Holzbaur et al., 2016)..<\/p>

Product Proposal

Apple Company has had several years of success owing to the product quality produced by the firm, especially the iPhone smartphone series. The smartphones have recorded millions of sales across the globe, with a huge percentage of sales resulting from middle and high-income earners. For instance, according to Basheer and Aqeel (2015), the iPhone 6 smartphone made approximately 200 million sales in the first few weeks of its launching and has since seen tremendous purchases from customers throughout its life cycle. Apple’s products are highly priced and specifically manufactured to meet elegance and top class individuals in terms of income level businesspersons, celebrities, and other high earners. Due to the merchandise high prices, other companies such as Samsung, Nokia, HTC, Lenovo, and Huawei have threatened Apple Inc. market share by offering affordable prices for a wide range of products. Apple cannot compromise quality and brand name by producing low-quality products at premium prices. Therefore, to meet needs of the middle and low-income earners while maintaining product quality, Apple Inc. has introduced iPhone minimal for such markets.<\/p>

Start-up Phase<\/h2>

The start-up phase of the iPhone minimal entails product manufacture and launch of the same to the market. The iPhone minimal is not a smartphone but contains some features found in the iPhone smartphone series: FaceTime, iTunes, Bluetooth, and the internet. The phone will require three primary raw materials for its development: lithium, glass, and aluminum. Lithium ions will be utilized for the development of the battery while glass and aluminum will be used for the manufacture of the screen and the casing respectively. The phone quality will be maintained to match that of the iPhone smartphone series: 0.3 inches thick of the casing and 100 grams of weight for the phone (Singh, 2015). The manufacturing process and production of the final product should take approximately 7 months. The product launching will involve approximately 50 million iPhone minimal copies produced and released to the market in the first phase and additional ones produced depending on the market reception.<\/p>

Market Development and Expansion<\/h2>

Notably, this life cycle phase is dependent on product’s marketing strategy and market response towards the phone production. If the market receives the phone positively, an attribute that will be measured using sales volume made after the launch of the phone. The first production phase will deliver 50 million copies of the iPhone minimal. If Apple Inc. makes sales that are equivalent to 85% or more of the total production, the company will increase production in the second phase by 30%. Subsequent productions will also be based on sales volume made in previous stages. The company will also invest in marketing the product to increase sales volume and increase production, market penetration, and product growth. The market strategy involves advertisements and product promotion strategies such as price discounts for the first customers to purchase iPhone minimal after its launch. Such strategies are projected to increase sale volume made every year at an annual rate of 20%. iPhone minimal is expected to register more than 200 million sales in both India and Southern Asia during the first three years after its launch. Therefore, this phase of the phone’s life cycle will take a maximum of three years.<\/p>

Maturity and Exit<\/h2>

Armstrong et al. (2015) explained that the product maturity phase reaches when sales volume is at the peak, and there is no significant change in sales made every year. During maturity, Apple Inc. is expected to make maximum sales from iPhone minimal. Stagnation of sales at approximately 300 million and frequent fluctuations below the mark will indicate that iPhone minimal has reached its maturity in the market. The maturity stage not only showcases that more people have been reached by the product but also that denotes the need for a better product taste due to changes in technology and customer needs. The result is always a decline in purchases registered due to obsoleteness factor. At this stage, Apple Inc. should consider exiting by redesigning the iPhone minimal to produce an upgraded product. The exit marks the end of the iPhone minimal life cycle and the beginning of the life cycle of an upgraded product, for instance, iPhone minimal plus.<\/p>

Profit Generation and Cost-saving Opportunities<\/h2>

Profit maximization is achieved through cost minimization and maximization of sales made on the market. Profit generation will be determined by activities aimed at maximizing sales made on the iPhone minimal product. At the same time, production costs will be minimized through activities that will cut down the cost of raw materials and operational costs.<\/p>

Cost-saving Opportunities<\/h2>

Use of recycled materials in the production of the iPhone minimal for subsequent supplies after its launch will minimize costs of production compared to ordering for mined raw materials from suppliers. Andreola et al. (2016) affirmed that use of recycled glass will save approximately 30% of the energy costs used in the production of new glass. While the cost of energy in glass production is saved, the phone price remains unchanged; hence, Apple Inc. will benefit from the large profit margin created.<\/p>

There is an opportunity for Apple Inc. to develop a return policy whereby consumers in the Southern Asian and Indian markets return undesired phones to Apple Inc. in exchange for waivers on prices of the iPhone minimal. The faulty phones contain various materials, which can be used by the company to manufacture some parts of the iPhone minimal. For example, lithium batteries in the returned phones can be redesigned to pass the iPhone minimal quality assurance and later resold with the new phones on the market. Apple Inc. will not only be saving on costs for an order of lithium ions but also on transportation expenses of the lithium ions from suppliers since customers will personally deliver undesired phones to the company’s distribution points.<\/p>

Recycling of aluminum for the iPhone minimal casing will serve as a cost-saving opportunity. Creation of aluminum cans from bauxite ore consume massive energy and human resources, which translate to increased production cost. Therefore, if costs on energy and human resources are minimized, the company will ultimately save on costs. Apple Inc. has an opportunity to recycle aluminum instead of purchasing manufactured aluminum from bauxite ore. The company will use 5% less energy consumed during aluminum manufacture. Reduction of such costs will help the company maximize returns on iPhone minimal product.<\/p>

Profit Generation Opportunities<\/h2>

Apple Inc. has several opportunities to create huge profit margins from sale and manufacture of the iPhone minimal product in the Asian market. Such opportunities are contingent on company able to develop an outstanding and effective marketing plan, which will enable it an edge on the competition and maximize sales. Apple Inc. has the opportunity of creating a brand name for the iPhone minimal product by building it with features that are available in the competing smartphones in the Asian market but unique to Apple and its customers at an affordable price. Other profit generation opportunities emanate from the performance of other brands made by competing companies in the market; whereby Apple can maximize gaps to capture a large market share through marketing strategies.<\/p>

The iPhone minimal product will operate on a software created by Apple Inc., which will be an imitation of the iOS software but uniquely developed to suit the low-tech literate market. In the modern society, smartphones are in high demand due to the social network features on smartphones such as WhatsApp, Facebook, internet, and FaceTime. The features are mostly used for communication, and therefore, the low-tech literate market in Asia will need them too. The iPhone minimal product will be created with the following features having a simpler framework, which will enable customers to communicate effectively. Since Apple Inc. will not invest massive resources in the creation of such applications compared to the investment that the company makes in the creation of the iPhone smartphones, the iPhone minimal price will be lower than what most competitors offer. Consumers will achieve satisfaction while at the same time enjoy affordable prices. Apple Inc. will make large sales volumes owing to this factor and generate more profits.<\/p>

There exists an opportunity for diversification and widening of the iPhone minimal supply chain to increase the company’s profit margin from the sale of iPhone minimal in Asia (Ganesh et al., 2014). The company has an opportunity of widening its supply chain through signing contracts with tech companies in Southern Asia and India. An example of such a company includes the TTI Inc., which can help Apple Inc. distribute the iPhone minimal products. Other companies can also be sought to help Apple Inc. supply the new product in the market. The result will be a rise in sales volume and increase in profit margin on the new product. Hu and Huang (2015) explained that Apple Inc. can generate profits from the benefit of market-wide access.<\/p>

Phase-out Plan<\/h2>

Apple Inc.’s iPhone minimal is projected to have a four years life cycle after which the product will exit the market while ushering an upgrade of the iPhone minimal based on the new market needs and demands. Additionally, since technology changes with time, the product exit strategy will consider the factor of alignment with the latest technological trends. The iPhone minimal product phase-out plan has three major stages, which include phase-out strategy and planning, withdrawal phase, and follow-up phase (Stark, 2015).<\/p>

Phase-out Strategy and Planning<\/h2>

The phase-out strategy is the first step of the phase-out plan whereby relevant departments and the manager in charge of the iPhone minimal project design a strategy that will ensure that the market is not extremely affected by the phase-out. The exit of iPhone minimal from the market will be followed by a launch of a new product which will be an upgrade to the iPhone minimal product. Customers will need support to migrate from the old version of iPhone minimal to the latest model at that time. Therefore, there will be drafting of customer support manual for the new phone. All sales agreements and supply chain obligations under iPhone minimal held by the company will be reviewed at this stage to determine the number of days needed for clearance allocation of the agreements and bindings to initiate a withdrawal. Integration of systems needed for the new phone will also be undertaken during this stage to ensure proper transition of technology.<\/p>

Withdrawal<\/h2>

After reviewing sales agreements and supply chain commitments, the exact time to initiate withdrawal will be approximated. An additional year is added to the life cycle of the iPhone minimal product to allow for communication on the end of phone life to various project stakeholders. Different departments in the company have to be informed on the market exit decision to avoid wastage of resources on the existing product. The total time estimated for the product lifecycle is four years. The withdrawal process should begin within the fourth year and the fifth year. Apple Inc. will establish a schedule that will guide the exact times for communication with every department within the firm. Different departments have divergent levels of impact on the business operation of a product in the market; hence, some will require more time to exit while others can exit in a short span of time without significant effect to the market. For instance, distributors and sales department of the iPhone minimal product will require more time than the marketing department to exit the market.<\/p>

The marketing department will be informed to withdraw marketing materials and the iPhone minimal catalogs from the company’s websites. Replacement of this information should be an advertisement of the upcoming product; an upgrade of the iPhone minimal on the website. The advertisement can contain a video and the projected launch date of the new phone to ensure that the company maintains the iPhone minimal customers. The product information absence on the website will duly inform the market of the exit. The research and development department will withdraw all efforts on maintenance of various software and applications in the iPhone minimal product. The sales department, in collaboration with the marketing department, will ensure that information concerning replacement of the iPhone minimal by the new product is well spread to sustain the market. The controlling department will keep costs incurred on check for outdated software and applications while the support team will ensure that migration to the new phone is initiated.<\/p>

Follow-up<\/h2>

Follow-up is the last stage of the phase-out plan of the iPhone minimal product by Apple Inc. The follow-up phase is meant to ensure that the company has handled all remaining inventory, and that information regarding the product on the website concerning its sale by the firm is no longer available. Instead, new information regarding the new product, which is a replacement, will be posted in the follow-up phase to lay a foundation for a new product life cycle. The iPhone minimal product upgrade will probably contain a new software, be more portable, and have better sound systems.<\/p>

References

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