Opportunity For This Marketing Plan

Marketing Essay
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In New Zealand, the original Apple Store is located in New Market. The Apple Store is
planning in open Apple stores in more key locations. This marketing plan aims to
present the objectives, strategies, tactics & marketing action plan for Apple Inc. for
promoting the new Mini iPhone product in New Zealand.

3. Area of interest
The area of interest for this assignment is a product - Smartphone/iPhone

4. Details of Area of Interest

There is a substantial increase in iPhone sales in the global market. The iPhone package
often comes with the phone, earphone with remote and microphone, dock connector to
USB cable, and USB power adapter and documentation. iPhone comes with different
memory size, including 16 GB, 32 GB and 64 GB, which are sold at different prices.
iPhone also have a number of overseas manufacturing plants in order to ensure low
manufacturing costs.
iPhone is first mobile phone that is touch screen without keyboard. It just uses our
finger to control the mobile phone that is substantially different with the traditional
mobile phone. iPhone can support many languages such as English, Chinese, French,
German, Arabic and Japanese and so on. The company Apple has established strong
global brand name and has grown into one of the largest mobile and tablet producers in
the world.

5. Opportunity for this marketing plan

There is an opportunity to develop a mini iPhone with more features and lower prices
for young people, such as more colours, stronger music functions and internet functions.
The reason for this opportunity is firstly that the sales of iPhone 5 are expected to drop
significantly in 2013, as can be seen from the figure below, due to changes in customer
needs and increasing competition from competitors such as Samsung.
Secondly, the newly announced iPhone 5 does not have significant improvement as
compared with the previous iPhones. Customers are complaining with the lack of
innovation of Apple and have started to seek different brand. The style and look of
iPhone 5 did not change much from the previous versions and the content, such as
software and functions, of iPhone 5 did not improve from iPhone 4 or IPone 4S
substantially.
Also, iPhone is priced in the higher range due to its popularity and unique design. The
following tables summarise the prices for iPhone5 and prices of competing products
from other brands. The prices are collected from Vodafone as of 30 October 2012. The
high price of iPhone 5 is not affordable for some customer groups, such as young people
and students. The price of iPhone 5 is almost as expensive as an average laptop in the
market. Those customer groups, however, are more likely to regularly change their
mobile and to try out new technology and products. Based on these reasons, there are
market opportunities for Mini iPhone, which are cheaper and designed to satisfy the
needs of young people.

Brands
Prices
iPhone5 32 GB
$1199

Sony Xperia U
$299

Nokia Lumia

$399

HTC One X 32GB

$999

Sumsung Galaxy S III 32 GB

$1049

6. Objectives
6.1 Marketing objectives
The overall objective of the marketing programs aims to successfully design and
promote the new Mini iPhone to young people who purchases phones more frequently
and have less disposable income to purchase expensive iPhones.

6.1.1 Product objective

The product objective is to design new packages and features of Mini iPhone product for
young people from 1 January 2013 to 31 December 2013.

6.1.2 Price objective

Price objective is to provide competitive pricing, which covers the costs and attracts
young people by 31 May 2013.

6.1.3 Distribution objective

Distribution objective is to expand traditional Apple distribution channels, such as
Apple store and electronic shops into more channels, such as supermarket, department
stores, and fashion stores by 31 May 2013.

6.1.4 Promotion objective

Promotion objective is effectively increase brand awareness and promote the sales of
Mini iPhone through establishing an IMC (integrated marketing communication)
campaign called "mini but mighty" from 1 January 2013 to 31 December 2013.

6.1.5 Other marketing objectives

Another marketing objective is to increase market share of Mini iPhone by 20% by the
end of 2013. Market share is an important issue to evaluate the effectiveness of this
marketing plan because it reflects the number of customers who have switched to or
maintained to be a customer of Apple after the launch of Mini iPhone.

6.2 Financial objectives

The financial objective is to achieve a sale of $40 million from 1 January 2013 to 31
December 2013 in the New Zealand market. Sales are sometimes argued to be a rather
weak measure for marketing effectiveness because there are a large number of external
and internal factors that can affect the level of sales (Aaker, 2009). It is difficult to
pinpoint to causes for changes in sales to marketing efforts. However, the level of sales is
still one of the post important measures to capture the financial performance of the
company.
In addition to sales, Return on Investment (ROI) can also be used as a financial measure
for Apple. ROI can be worked out using the following formula.
Source: BUSINESS CASE ANALYSIS (2012)
In particular, the financial objective for Apple should be to achieve more than 20% ROI
from 1 January 2013 to 31 December 2013. It is important for Apple to ensure the gains
from developing and promoting Mini iPhone covers the costs of doing so.

7. Strategy
7.1 The product strategy
The product strategy is to reduce complicated functions for businesses and design more
colours, different material packaging, and features for young people, such as stronger
music system and internet connection programs. The product strategy is product

differentiation. Kotler and Keller (2012) claim that products can be differentiated in
different forms, including the size, shape, or physical structure of a product. The aim of
the product differentiation strategy is to be different from the products offered by the
competitors and be more attractive to customers. Currently, Apple needs to address
customers' concern that iPhone has got too many features with too high a price. Mini
iPhone is expected to get rid of the redundant features through the compact design.
Another reason for adding more colours and phone accessories is to be more appealing
to the young consumers. As discussed before, young people are an important group of
high-tech chaser who change cell phones very frequently and are easy to be attracted by
fashionable elements in cell phones. Therefore, the product strategy is expected to
resolve the current concern over complicated functions and attract more young
customers than before.

7.2 Pricing strategies

The pricing strategy that Mini iPhone will pursue is the price skimming strategy (Kotler
& Keller, 2012). Many high-tech products adopt the market-skimming pricing because
technology sets up the environment for this price strategy. A cell phone manufacturer
comes out with a new cell phone model every 8 to 10 months (Bovay, 2012). This means
the older model is soon replaced by new ones, and they have to cut prices to attract
buyers. In contrast, the new model is equipped with the best technology and is able to be
sold at a better price. For Mini iPhone, the starting price would not be as high as a
standard iPhone 4S or iPhone 5 because it has got less features. It is also the objective to
design and market a more affordable model of iPhone. Mini iPhone is designed for
young customers with less income but is interested in changing their phones more
frequently. Apple can attract young people with the competitive pricing and can make
more profits in the future by producing more Mini iPhone accessories. However, it will
be more expensive than competitors' products with similar features because the Apple
platform is irreplaceable. As time goes by, Apple can consider price reduction to target
the majority audience.

7.3 Distribution strategies

Apple should continue to use the selective distribution strategy that it currently
implements in New Zealand. Selective distribution strategy means that Apple will rely
on a number of intermediaries to carry and sell a particular product (Kotler & Keller,
2012). These intermediaries include Apple stores, electronic shops, and
telecommunication stores. The internet should also be considered as it is a relatively
cheap distribution channel to reach a large number of potential customers. Compared
with exclusive distribution, selective distribution is more flexible for Apple. It allows
Mini iPhone to gain adequate market coverage with more control and less cost than
intensive distribution (Kotler & Keller, 2012). If the initial market response for Mini
iPhone is good, Apple could also consider widening the distribution channel by selling
Mini IPhone in major shopping malls or department stores.

7.4 Promotion strategies

The promotion strategy for Apple will be changed to develop an IMC (integrated
marketing communication) campaign to market Mini iPhone. In particular, IMC allows
a brand to market its products and services through multi-media and channels in order
to effectively reach target customers(Kerin, Hartley, Berkowitz, & Rudelius, 2009).
Traditional mass marketing channels, such as television advertising, are not "mass"
anymore because the fast development of technology and globalisation have changed
people's lifestyles, such as where to get information. A lot of people today do not watch
TV regularly but prefer to search information online. It is not possible to reach all target
customers through a single marketing media or channel. In the case of Apple, the target
customers for Mini iPhone include young people aged between 20 and 30 years old. The
main message for the IMC for Mini iPhone is "mini but mighty", which indicates that
Mini iPhone can have so much features and functions than it looks. The detailed tactics
for each of the channel will be discussed in greater details in the tactic section. In
addition, Apple needs to adopt a pull strategy, which directs the promotional mix at
consumers directly to encourage them to ask the retailer for a product (Kerin et al.,
2009). This is customer demand for the product is the most important driving force for
the success of Apple.

8. Tactics
8.1 Product tactics

The product tactics for Mini iPhoneinclude the following:

1. The package design will be changed to use less expensive materials and are easily
changeable to multicolour cases and other cases. An example of colourful Mini iPhone is
shown below. Main colours to be used should include the rainbow colours - red, orange,
yellow, green, blue, indigo, and violet. The purpose is to give consumers more choice of
colour to customise their life. In order to be innovative and focus on particular interest
of young people, there can be frequently updated special edition cases for Mini iPhone,
such as cases designed for Rugby World Cup or cases designed using themes from
popular movies.
2. The phone will remove complex business functions and add more functions for young
people. These include stronger music player and more games. For example, Mini iPhone
can have built in game pad to allow young people to have better gaming experiences. An
example of the design is shown on the right.

3. Instead of giving traditional iPhone earphone in the package, Mini iPhone can give
customers wireless earphones that are colourful and unique. These wireless earphones
are estimated to cost less than $20 to manufacture.
4. The product size for Mini iPhone should be slightly smaller than iPhone 5. The
following picture shows the size of current iPhone5, which is 123.8 mm x 58.6 mm. The
designed size for Mini iPhone should be about 100mm x 58.6mm.

8.2 Price tactics:

As stated in 7.2, the general pricing strategy is price skimming strategy that starts with a
relatively high price and gradually lowers the price down. However, it is important to
determine what the starting price should be. Since Mini iPhone is a compact version of
iPhone, the reduced function and production costs should be reflected in the pricing. At
the moment, the standard prices for different model specifications of iPhone 4S and
iPhone 5 are listed below. These prices are official prices offered through Apple New
Zealand online store (Apple Store, 2012).

Different Prices between Iphone 5,4 and Mini

Iphone
16 GB
32 GB
64GB
iPhone 5
$1029
$1,199
$1,349

iPhone 4S
$788
$945
$998

Mini iPhone
$498
$598
$698
Since Mini iPhone keep two thirds of the functions of standard iPhone and it is made of
cheaper materials, the starting price for Mini iPhone should be lower than the current
prices for iPhone 5 and iPhone 4S. This will attract the customer because they would
value the trade-off between features and prices. Kotler and Keller (2012) point out that
many products are offered with different features that supplement their basic function.

It is important to consider how many people want the extra feature and how much it
would take to introduce additional features in the market. The features taken off are
reflected in the reduced price shown in the table. This price is very competitive as Apple
has never offered mobile phones at this affordable price. It is now more affordable for
the vast majority of consumers to own their apple product without too much financial
burden.
This price range is very attractive considering the brand equity offered by Apple and the
supplementary services (e.g. AppStore) that mobile phone users cannot get from
anywhere else. The table below is a summary of the current prices of the popular mobile
phone models offered by Apple's competitors as listed on PriceSpy (2012).

Comaparision prices of phones between

companies
HTC
Samsung
Nokia
Sony
HTC One 32 GB
$595
GT -i9300 Galaxy SIII 16 GB
$665
Lumia 800
$339
Sony Xperia U
$247

HTC One S
$535
GT -i9100 Galaxy S II
$475
Lumia 900
$525
Sony Xperia S
$465
HTC One 16 GB
$595
GT-N7100 Galaxy Note II 16 GB
$579
Lumia 610
$232.98
Sony Xperia P
$386
HTC One XL
814.95
GT-i9300 Galaxy S III 32GB
$797.99

N9 16 GB
$359
Sony Xperia Acro S
$649
HTC Desire HD
$439
GT-S5570 Galaxy Mini
$97
808 PureView
$799
Sony Xperia SL
$563
HTC Evo 3D
$529
GT-i8160 Galaxy Ace II
$361
Nokia N8
$485
Sony Xperia Go
$349

HTC Evo Design

$499
GT-i9070 Galaxy S Advance
$413
Nokia E7
$519
Sony Xperia TX
$769
Compared with competitors' prices for different mobile phone models, Mini iPhone is at
the average level of the mobile phone prices. This price is expected to remain for a while
to attract Apple fans and early adopters. After 5 months of the introduction of Mini
iPhone, Apple should lower the price of Mini iPhone according to the price skimming
strategy. The first price reduction can be $60 to $100 where the largest reduction should
take place for the highest level model of the 64 GB model. The reason is to encourage
customers to purchase more of the best models in the Mini iPhone range as the profit
margin should be higher for the highest model. The second price reduction can be a
further $100 decrease to make it even more appealing to the average consumers in New
Zealand with average purchasing power. Also, the second price reduction is likely to
coincide with Apple's new mobile phone model release. As many high-tech products do,
the Mini iPhone product should have been an older model by then and price should be
reduced to stimulate demand.
This process of price changes for Mini iPhone is summarised in the table below.

Time
Mini iPhone (16GB)
Mini iPhone (32GB)

Mini iPhone (64GB)

Initial introduction
$498
$598
$698
5 months after the introduction
$438
$518
$598
The second price reduction (about 12-18 months after the initial introduction)
$338
$418
$498

8.3 Distribution tactics:

As mention before, the mixed distribution strategy has been using by apple in New
Zealand for some time.Telecom and Vodafone have play a role such as intermediaries
who are specialised in providing telecommunication services. It also authorises a
number of department stores and specialty stores to sell the iPhone products such as
Dick Smith, Noel Leeming, the Warehouse, and Harvey Norman. These established
distribution channels are readily to be used by Mini iPhone. New information about
iPhone products should always been given to those distrubutors in advance. It is
important to continue the relationship with these existing distributors because they
have been the selected distributors for Apple for many years. They have accumulated
valuable experience in introducing and selling the iPhone products to the customers.

They are always in the best position to sell Mini iPhone as long as Apple provides those
informations to them in advance so that they have time to get prepared during the
launch day of iPhone Mini.
In addition, Apple should make better use of other distribution channels to sell Mini
iPhone as well. Consumers are more willing to shop online for Mini iPhone if it is
available in their countries and regions. Apple could consider offering Mini iPhone
through its online store in New Zealand. It could also include free delivery services to
better encourage online purchase of Mini iPhone. However, this plan is subject to the
condition that Apple can negotiate good delivery terms with logistic companies or with
Post NZ. Given the influence of Apple, this should not be too difficult. What Apply
should consider is whether the cost of delivery is matched by the increase in demand
and sales for the new product, Mini iPhone.

8.4 Promotion tactics:

8.4.1 Advertising tactics for brochures
Newspaper is not selected to promote Mini iPhone because few young people read
newspapers today. Brochures will be used to promote Mini iPhone because brochures
sent out at the point of purchase not only sent information about Mini iPhone to
customers but also stimulate purchase decisions.
The brochure design should be creative, distinctive and informational. This means that
the brochure needs to have distinctive Apple logo, have creative design, and contains
sufficient information about Mini iPhone. The following pictures show a sample
brochure for Mini iPhone. The brochure takes a form of a Mini iPhone and shows
information about key features and characteristics of Mini iPhone, such as the multiple
colour choices and the cheaper prices.
The brochure should be about 166mm high x 65mm wide or slightly smaller in order to
have sufficient spaces for the information and be close to the size of Mini iPhone. It
should also be printed 2 sides because the brochure if likely to be folded. Colour print
should be used in order to promote the fashionable, young, and colourful design of Mini
iPhone.

Vistaprint can be a potential supplier to print the brochures. The cost of printing
brochures at Vistaprint is shown in the table below. The more orders to placed the more
cheaper price they got, therefore, Apple should print 100,000 brochures first, which cost
NZ$30,000.
Source: Vistaprint (2012)
The brochures will be distributed to partners, such as electronic shops (E.g. JB Hifi,
Dick Smith), Apple stores, telecommunication stores (E.g. Vodafone, Telecom), and
other retailing stores for Apple. These brochures are given freely to customers who are
interested in Mini iPhone. These customers are more likely to be potential customers
because they are interested in taking the brochure and they are customers of related
shops, such as electronic shops and telecommunication shops.

8.4.2 Advertising tactics for radio

Radio advertising for Mini iPhone should be on popular radio programs such as Mai FM
88.6 music channel. The station of the channel is located in Ponsonby Auckland. The
channel broadcast popular music, has a number of popular shows or programs, and
holds special events with super stars or in local community. Mai FM is selected because
it reaches a large proportion of young people, who often listen to the channel when they
are travelling. In particular, Mai FM reaches 289,642 people, aged below 35, every
month(Mediaworks, 2012). Good coverage among New Zealand also became one of the
main key why this channel had been selcted.
The advertisement of Mini iPhone should be presented every weekday (Monday to
Friday) during the morning programs, including Mai Morning (6am - 10am) and K-Lee
(10am - midday). Such time is the best time to dvertised the products as most people
will be listening to the ratio while driving or while taking public transportations. The
advertisement will firstly to broadcasted for 1 months (four weeks) before the evaluation
of the effectiveness be carried out. The message in Radio is not visual and customers are
not able to see the colourful cases. The advertisement needs to include statement of key
features and use sense of humour to make the advertisement more memorable.
The creative development of the radio advertisement can cost about $1,750 and the
media cost at Mai FM can cost from $3,000 to $6,000 a week (Mediaworks, 2012).

Therefore, the total cost for Apple to advertise Mini iPhone on Mai FM can be from
$13,750 to $25,750 (Mediaworks, 2012).

8.4.3 Advertising tactics for TV

Television advertising for Mini iPhone should focus on advertising during and after TV
shows that are popular among young people, such as American's Next Top Model and
Music TVs. Therefore, Apple should advertise on TV Four, which is a newly launched
channel that provides young people with interesting shows, such as American's Next
Top Model, Beauty and the Geek, Survivor, and American Horror Story. This TV station
is chosen also because it has a good coverage of all major cities in New Zealand. TV Four
reaches more than 700,000 audiences mainly aged between 18 and 49 years old every
month(Mediaworks, 2012). These are the target customers for Apple who are interested
in new and fun stuff and have a taste for fashion. Therefore, the advertisement should
have the message as "fashionable, new, and innovative" and highlight the interesting
features of Mini iPhone.
The advertisement should be broadcast after and in between shows, such as American's
next top model and Beauty and the Geek. This ensures the advertisement reaches target
audiences. The approximate time for such programs and shows are at 7:30pm to 9pm.
The advertisement should also be presented on weekdays because it is likely that young
people will not be watching TV on weekends but are busy with other social events.
The commercial production costs can be at least $2,500 and the cost of advertising on
New Zealand TV channels on weekdays at the time selected above is more than $10,000
per day(TVNZ, 2012). It is planned for Apple to advertise on TV for about four weeks,
which generates a total TV advertising cost of at least $202,500.

8.4.4 Advertising tactics for the internet

Internet and social networks are popular and welcomed by young people. This is an
opportunity for Apple to win over these customers. For example, Mini iPhone can
advertise through the internet and social network websites such as Facebook and
Twitter. There are more than 835 million Facebook users in the world in 2012 (Internet
World Stats, 2012). It does not cost much to set up social network pages and answer
customer enquiries. But it does create a good communication channel between the
company and its customers.

Apple Facebook has 1.63 million fans, as can be seen from the picture above, which is a
great source for Apple to market its new Mini iPhone product(facebook, 2012).
However, the current facebook page of Apple only presents pictures of iPhone products
and allows customers to download Apple wallpapers for their computer. There are no
updates of information on company and products and little interactions are made
between customers and the company. Apple should utilise the communication
opportunity created by facebook and collect valuable feedback from customers and
promote the new product to them effectively.

8.4.5 Sales promotion tactics

In order to design an interesting and unique promotion for Mini iPhone and combine
different channels together, Apple can give a prize (a brand new Mini iPhone with a
limited edition case) for a competition, which involves customers sharing the best
photos with their Apple products on their facebook page. The competition aims to
stimulate the interests of young people and potential customers and promote Mini
iPhone to loyal Apple customers through the Internet world. The winner's photos can
also be shown on TV advertisement or Apple website with their permission. Examples of
such photos are shown below. Apple should provide 50 prizes, which costs about $1,000
each. There can also be administration costs for this promotion. The total cost of sales
promotion for Apple is about $51,000.

8.4.6 Public relations tactics

Apple can sponsor a program that provides discounted price Mini iPhone to University
students. University students can purchase new Mini iPhone at a slightly lower price
with their proven of enrolment. This sponsorship is to provide specific supports for
university students, who are target customers of Apple but do not have high income. The
cost of this sponsorship is planned to be $150 per unit (one Mini iPhone). The total cost
of this sponsorship can vary depend on the number of university students who wish to
purchase Mini iPhone.

8.4.7 Personal selling tactics

Apple should allocate a direct personal selling assistant to retail stores, such as Apple
store, JB Hifi, and Bond Bond, and at University campuses. This is to allow the personal

selling assistant to answer any questions by potential customers and to encourage

potential customers, such as university students, to try Mini iPhone. The personal
selling activities are planned to hold for 1 month for 30 personal selling assistant in
Auckland. The cost of sales person per year is approximately $40,000. Therefore, the
total cost for labour costs for this promotional activity will be $100,000. There will also
be material costs, which cover travel costs, sample Mini iPhone costs, and brochures.
Material costs are expected to be about $86,000. The total personal selling cost is
therefore $186,000.

9. Marketing action plan

9.1 Activity (Tactics)
9.2 Responsibility/Accountabilities
9.3 Interdepartmental support
9.4 Timelines: Dates -S = start & E = End.
Months/Year
Activity 1 Design and develop Mini iPhone with new features
Design Department
Finance, Purchase
1 January 2013 - 1 April 2013
Step 1: look for cheap materials for producing multi-colour case
Purchase Department
Finance, Purchase
1 January 2013 - 30 January 2012
Step 2: Design strong music and game features and drop non-essential features

Design Department
Finance
1 January 2013 - 29 March 2013
Step 3: Add wireless earphone features
Design Department
Finance, Purchase
1 February 2013 -31 March 2013
Step 4: Reduce the size of the phone
Design Department
Finance, Marketing
1 March 2013 - 1 April 2013
Activity 2: Set prices for Mini iPhone
Marketing Manager
Finance
1 April 2013 - 1 November 2013
Step 1: Announce the starting price of Mini iPhone
Marketing Manager
Finance
1 September 2013
Step 2: First downside adjustment to price as planned

Marketing Manager
Finance
1 October 2013
Step 3: Second downside adjustment to price as planned
Marketing Manager
Finance
1 November 2013
Activity 3: Distribution arrangement
Production Manager
Marketing
1 February 2013 - 1 May 2012
Step 1: Contact major existing distributors (especially Telecom and Vodafone)
Production Manager
Marketing
1 January 2013 - 20 February 2013
Step 2: Provide product information to nationwide retailer
Production Manager
Marketing
1 March 2013 - 1 April 2013
Step 3: Construct Mini iPhone official website and add the product to online store

Production Manager
Design
20 March 2013 - 1 May 2013
Activity 4: Launch IMC marketing campaign
Marketing Manager
Finance
1 August 2013 - 1 December 2013
Step 1: Advertise using 10,000 brochure
Marketing Manager
Advertising
1 Aug 2013 - 1 Sep 2013
Step 2: Advertising via MyFM 886
Marketing Manager
Advertising
1 Sep 2013 - 1 Oct 2013
Step 3: Advertising on TV4
Marketing Manager
Advertising
20 Aug 2013 - 20 Sep 2013
Step 4: Advertising on Facebook

Marketing Manager
Advertising
1 Aug 2013 - 1 Dec 2013
Step 5: Sales promotion competition
Marketing Manager
Sales promotions
1 Oct 2013 -1 Dec 2013
Step 6: University student sponsorship
Marketing Manager
Public relations
1 Oct 2013 -1 Dec 2013
Step 7: Personal selling activities
Marketing Manager
Personal sales
1 Sep 2013 - 1 Oct 2013

10. Budget
A brief budget for Apple to design and promote Mini iPhone is presented in the table
below:

Marketing budget
1 January 2013 to 31 December 2013

Sales
$40,000,000
Less cost of goods sold (50% of sales)
$20,000,000

Gross Margin
$20,000,000

Direct expenses
8.1 product expense
$7,000,000
8.2 pricing expense
$150,000
8.3 distribution expense
$290,000
8.4.1 advertising brochure expense
$30,000
8.4.2 advertising tactics for radio
$193,750
8.4.3 advertising tactics for TV
$492,500
8.4.4 advertising tactics for the internet

$66,000
8.4.5 sales promotion tactics
$78,000 (3 employees)
8.4.6 public relations tactics
$100,000
8.4.7 personal selling tactics
$186,000
Other expenses (administration costs)
$120,000

Total direct expenses

$8,706,250

Contribution Margin
$11,293,750

11. Barriers to implementation

Barrier 1 is the financial costs involved in developing and executing the Mini iPhone
product. Apple is one of the most influential companies in the world with strong
financial and human resources. However, it is still desirable to undertake the Mini
iPhone project if the costs of the implementation process do not exceed the plan and the
budget. The issue is that it can be difficult to execute new designs for Mini IPhone and
control cost low at the same time.
Barrier 2 is the ethical issue involved in coordinating the production and distribution of
Mini iPhone products. As a convention, the iPhone series is designed by Apple but is
produced in China by the company named Foxconn. It is important for Apple to

establish strong supply chain relationship and seek overseas manufacturing

opportunities with lower costs. However, ethical issues can arise for production plants
and manufacturing partners in developing countries. For example, the suicides of
workers at Foxcoon, which manufactures IPhone for Apple in Shenzhen China and the
nets to prevent suicides have attracted a lot of attention from the media (Johnson,
2011). Therefore, there can be pressure from the media and public and maybe the
government for Apple to handle.
Barrier 3 is the technical barrier involved in developing a Mini iPhone product that
satisfies all needs of young customers using current technology. Technical improvement
and innovation can be expensive especially considering the low prices objective for Mini
IPhone. This requires Apple to continue research and development in technology. The
lack of innovation in iPhone 5 should be studied and avoided in the future when
developing new models, such as Mini IPhone.
Barrier 4 is the employee commitment to the Mini iPhone project. It is documented that
employees in large and successful companies lack the sense of crisis or urgency
(Campling, Poole, Wiesner, & Schermerhorn, 2006). Apple has been highly successful in
the past decade with star products such as iPod, iPhone, iPad, and MacBook. The
employees, the technology department, the marketing department, and even the top
management level, may lack the motivation to commit to the development of a new
product. Low employee morale since the death of Steve Jobs also contributes to the
barrier and the project may be slowed down or significantly impeded due to this barrier.