69% Of long-haul passengers watch an on-board movie when they are flying

20% Rather watch news

On average, long-haul passengers on the main European airlines watch on-board TV during 80 minutes

This research figures included taking into the account all of the airlines that are currently available on the world market, involving surveying all of the long-haul flight passengers on these airlines, which means this data is relatively accurate. And if there’s a 69% probability that long-haul passengers watch an on-board movie when they’re flying, and on average they watch on-board TV during 80 minutes, this suggests that it is very likely, that the passengers will want to try the new Apple noise-cancelling headphone, which increases the chances of my method of promotion being successful.

• In terms of fitness for purpose, this advert directly relates to the product being advertised, and clearly outlines all of its characteristics. It is also fit for purpose, because the advert targets those people, who are most likely to benefit from using such product as noise-cancelling headphones due to excessive noise caused on the airplane, and it is also those people who are most likely to buy new Apple headphones, because they are prior able to buy this product, because those people who fly, and especially on the airlines picked by me such as British Airways, Air France and Lufthansa, are likely to be in the medium and high income brackets due to high prices of the tickets.

• In terms of how clear the message and how well it is delivered to the audience, it is on a relatively high level, because the message is made clear, the headphones are given out to the passengers on the airplane, they are able to try the product, and then they are asked whether they would like to buy it. The aim of my message was to make people want to buy these new noise-cancelling headphones, and recognize that it’s made by Apple, and therefore also increase Apple appearance of the company that not only produces music players such as iPods, computers and accessories, but good, high quality, niche market noise-cancelling headphones that are no worse than any other made by their competitors such as: Bose, Sony, Senheiser, Bang and Olufsen and others.

The main weaknesses of this method of promotion are:

• Only those people who have long haul flights are targeted in my promotion, whereas many of those people who listen to the music, but don’t fly due to immobility to travel by an airplane may not find out about new Apple noise-cancelling headphones, and will not benefit from it, which means there will be only a limited number of people who fly who will be able to experience new Apple headphones.

• The extent to which this method of promotion will be effective is also limited, because the new Apple noise-cancelling headphones cannot be advertised on all airlines due to a high cost. In theory they can be, but it will not be cost-effective, because in terms of costs of advertising it’s better to target few most popular airlines with the highest number of passengers that travel, who can therefore be targeted during my promotion, rather than advertising on all airlines which might not have as many passengers traveling, which will lead to high costs of promotion per unit of headphones produced. However, due to this constraint, and the fact that some e.g. some Asian airlines will not be affected, most of which have long-haul flights, decreases my audience and the number of potential customers that can be targeted during my promotion, who may well have a high demand for the new Apple noise-cancelling headphones.

• There’s also a risk involved, that e.g. someone might break the headphones on the flight, which increases the chance that next time some other person on the airplane might get a pair of broken headphones, which will ultimately make this person dissatisfied with the quality of the product and create a bad image and reputation for Apple, because it will be very difficult to monitor the quality of those headphones that are given out to the passengers to rent or to try on during the flight. However, alternatively this problem or weakness of my promotional method can be solved by checking all sets of headphones and replacing the broken ones if necessary every 6 months, which will obviously lead to slightly higher costs, but it will only be a marketing cost, and it would be probably be better for the Apple’s reputation to replace the broken sets of headphones to increase people’s awareness of the high quality products produced by Apple, and improve its reputation, rather than doing the opposite.

• It will also be very difficult to control the price for the new Apple noise-cancelling headphones, if they are sold on the airplane, as well as whether passengers will be offered a free trial, or asked to pay a rent. However, there might be some special agreement between Apple and certain airlines about what price they will be allowed to charge under the contract, and terms of use of the promotion, because Apple will be in this case mainly selling the noise-cancelling headphones to the airlines rather than customers directly, which means airlines can charge slightly higher prices. This, therefore, makes the price control difficult.

• It might also be difficult to monitor whether the passenger has already used his trial, and he might be asked for his boarding ticket details, which means there will be more work for the cabin crew, which will make the whole process slightly more complicated.

• People on short-haul flights will not be affected to such a great extent, because they will not have as much time to experience the new Apple noise-cancelling headphones, or the airplane used for the short-haul flights might not be fitted with the screens and appropriate equipment such as music players, that noise-cancelling headphones can be used with.

Secondly, I’m going to discuss all strengths and weaknesses of my second method of promotion which involves putting an advert about new Apple noise-cancelling headphones into an in-flight magazine, that can often be found in the back pockets of the seats in the airplane. The strengths and weaknesses associated with this method of promotion are actually quite similar to the ones associated with the first method of promotion, because both methods involve advertising in the airplane. However, there are also some differences, because visual and physical promotions of the product are two completely different methods.

The main strengths of using this method of promotion are:

• It is relatively original which should make my advert memorable and increase the chance of people buying these headphones, because I’ve used an analysis of the adverts used by Apple competitors as well as some other firms, and took the main strengths of those adverts and tried to avoid the main weaknesses, because it involves use of people in the advert, there’s a set theme which is funny, because it shows that whatever the noise distraction might be on the airplane, even if another person is using a loudspeaker in-front of a person listening to new Apple headphones, he will not be distracted from enjoying listening to the music, due to Apple’s noise-cancelling technology. This makes this advert both memorable and outlines the main feature of these headphones.

• Communication is also highly effective not only due to how clearly the advert is made, so that the person can understand it by both looking at the picture and reading information about the characteristics of the headphones, but there are also captive audiences with this type of promotion, because people will be sitting on the plane for a certain number of hours, depending on the type of flight.

• In addition to this, communication is likely to be effective, because according to my primary research 68% out of all my respondents said, that they could possibly buy something from an in-flight magazine and 88% said that read in-flight magazines. The extent to which this method of promotion is effective depends on where in the magazine the advert is located. However, if it is located in the right place, then there’s a high chance that the person will read it, which increases its effectiveness.

• The layout of this advert is simple and clear, as well as colourful, which leads to effective, high level aesthetics. It doesn’t have too many pictures or colours neither it has too much text written or information provided about the Apple noise-cancelling headphones.

• In terms of fitness for purpose, this advert clearly outlines what the product is, its main features, characteristics, price and availability. It is clear and it’s printed, which avoids any possible confusion, which makes this advert standout amongst the others, and makes it effective. It is fit for purpose due to its design, use of people and the actual headphones, as well as showing how it looks if the person was wearing them. This advert emphasises what the flight for any person on that airplane should be like, and this also targets the audience and encourages them to try this product and enjoy it, just like the man on the picture.

• In terms of the brand loyalty, this advert effectively promotes Apple brand, because it has the Apple logo, as well as the fact that this advert was made to be memorable, and the extent to which it’s memorable will affect how well the Apple brand will be remembered or promoted in this particular advert. It also promotes the brand loyalty, because this advert is simple and clear, and all Apple adverts are like that. They never contain too little or too much information, which should also help people to associate this advert with Apple.

• In terms of the message and getting this message to the customer. Although there are certain limitations, if found and read, this advert clearly transfers the message, encouraging people to try the product and recognise that it’s Apple, which it clearly does. However, not all passengers on the airplane are guaranteed to see this advert or pay attention to it and read it, which leads to a certain degree of risk, especially if there are some other similar adverts published by competitors or about similar products.

The main weaknesses of this advert are:

• Similarly to the previous method of promotion, only those people who fly will be affected, and particularly those who fly frequently or those people who usually have long-haul flights.

• There’s a risk that this advert might not be found or read in the magazine, due to its misallocation in the magazine, or people not being interested in the noise-cancelling headphones.

• Some people on the flight may not have enough time to buy the new Apple noise-cancelling headphones or try them on due to a short flight; therefore, although they’ve seen or read an advert and it might have had some impression on them, they will not buy the product due to a lack of time.

• It might seem ridiculous, but some people on the flight might fall asleep, and not read the magazine due to their tiredness.

• Some people on the flight might not understand English, because they are foreign, which might not get the message of the advert across to them, which will decrease the extent to which this method of promotion is effective. This problem can be solved by making sure that an advert provided in the in-flight magazine on a particular airline is translated into the language that most passengers on that airplane are likely to speak. And although there might still be some people on the airplane who don’t understand the advert, it should be made sure, that the visual impact is so great and the picture of the advert is so clear, that the message can be transferred to the passenger easily without having to translate it into another language.

Market Research

For my market research, which played the biggest role in my decision making process on what method and type of promotion strategy to introduce, as well as its design and the way I did it. I have firstly carried out both secondary and primary types of market research.

For my secondary research I was looking at different promotional methods and strategies used by various businesses as well as the ones used by Apple, which I initially chose to design my promotional strategy for. I have also conducted secondary research to find out whether those promotional methods, that I’m going to introduce, are likely to be effective. I’ve looked at the demand for different flights, tried to find out whether people watch TV and movies in the airplane, and what percentage of them read in-flight magazines, as well as the number of the potential audience that my promotional methods would be targeting. For my secondary research I have also looked at the adverts used by other companies including some of the Apple competitors’, and their layouts.

For my primary research, I have conducted 25 questionnaires to find out how often people fly, whether or not they use headphones on the airplane, read and buy from in-flight magazines, the type and length of flights, what brands they recognise most, the types of promotions they like and whether they would be prepared to rent the new Apple headphones. In addition to this, I have carried out closed Focus Group discussions with 6 people, where I have given them out various examples of adverts and asked them some detailed targeted questions about the various types of promotion, what they liked about them, and what they liked about the adverts that I’ve given them out in terms of its design, use of colour, objects and people, layout, context, use of language, aesthetics, message, fitness for purpose, communication, strengths and weaknesses associated with each particular type of promotion. I believe that this information has helped to analyse and identify current trends in promotion, and particularly what people currently like and want to see from an advert. I also believe, that this information has effectively helped me to decide whether or not to introduce a particular method or type of promotion for Apple and whether it would be appropriate for its new noise-cancelling headphones.

However, although my secondary and primary types of research were relatively good and useful for my decision making process in what type of promotional method to choose, there are still a number of limitations and inaccuracies, which could have affected my overall decision. Firstly, there were only 25 people involved in my questionnaire and it was non-random, (a sampling method I used was Quota) which means the audience wasn’t targeted specifically in accordance to their age, gender, interests and income bracket. The data that has been obtained, was to a certain degree bias, because it mainly involved asking students and didn’t involve asking the elderly age groups of the population. The questionnaire has been carried out in the Bromsgrove area in the UK only, which means that if e.g. this questionnaire was divided and carried out in all of the UK cities, taking, dividing into people into equal groups according to their gender and income bracket, as well as taking into the account those people who don’t fly or in any way use air transport. In addition to this, it would also make my data more accurate, if I have had divided those people who use air transport into several equal groups, according to the airlines that they use. However, the extent to which I was able to carry out such research was very limited, because I’m a boarder-pupil at school, which doesn’t give me enough time and doesn’t allow me to go to the other cities and towns in the UK to carry out a more accurate and sophisticated market research. So, in terms of time that would have to be sacrificed for such research, I do not believe, that it would be very cost-effective.

Also, there could have been additional research carried out about the promotional strategies used by other Apple’ competitors, as this would also help to consider whether an option of advertising on the airplane was the best one to choose, and whether there were any other better alternative promotional strategies or methods that could have been used. Furthermore, I could have ordered a special report on the current trends in the headphones and noise-cancelling headphones markets in 2008/2009, for which I would have to pay a relatively high price, because these sources of information are available for free access. However, although it would lead to the certain costs, it could be beneficial for me in the long-term, because this data would be more accurate, carried out by specialists in different countries, using complex sampling and research techniques.

When recording my data, I have used excel tables, specially designed to record my results, as well as mathematical formulas to workout the mean and average for certain results, in order to obtain the most realistic figures. The quantitative data has been used to make accurate decisions on the particular type of promotion, estimate all potential costs and benefits associated with a particular form of promotion, and compare to the other alternative methods.

The message to be communicated and the targeted audience

My marketing message was to make people want to buy the new Apple noise-cancelling headphones, realise how useful the noise-cancelling technology is, and encourage people to recognise Apple brand not only in terms of the musical players and PC producer, but also in terms of a new company coming onto the noise-cancelling headphones market with the new high quality product. From both of my promotions, it is evident that the message is clear, because it clearly shows the product and brand logo, outlines its main characteristics, as well as allows to understand that Apple is confident that it is a high quality product, by giving it out to people on the airplane to try on, compare to the other similar products, and enjoy the usefulness and high quality of the product at the place where it is most needed and appropriate. However, the extent to which my marketing communication reaches the target market is limited, because by promoting the new Apple noise-cancelling headphones on the plane, I’m not targeting those people who don’t fly, neither I target people who use other airlines that were not chosen by me due to the relatively high costs of advertising and difficulties with monitoring the promotion on a wider choice of airlines. Although, I decided to use only three airlines to make my method of promotion cost-effective, in the long run it might actually make sense to introduce new Apple noise-cancelling headphones on the other airlines, if it works out well on the first three. This should, in theory, help me to minimise the risk of loosing too much money, if my promotional method doesn’t work out as well as it is expected. There might also be some people who can afford to buy the new Apple headphones, but they might not necessarily have enough money to fly, which again implies that my marketing communication is bias, cannot reach all of the target market and is not perfect. However, if we consider the costs of advertising on the airplane and the number of target audience that can be potentially reached, in comparison to alternative sources of advertising and promotion such as Radio, TV, Posters and Internet, we should be able to see that advertising on the airplane is more cost-effective, even though it doesn’t reach all of the target market unlike TV and Radio, which are likely to get the message across a larger number of people, a certain percentage of whose might be my target market, but it will be very expensive in terms of the cost per person.

Moving onto the promotional budget section, I have conducted some further research to find out the cost of my proposed promotional campaign and it’s effectiveness in terms of cost per person, in comparison to TV, Radio, Internet, Cinema, and Posters, taking into the account current marketing budgets of Apple Inc.

Country	Airline	Name of the magazine	Passengers in 2006	Circulation	Audience	Periodicity	Cost
France	Air France	Air France Magazine	50,464,873	386,019	1,128,000	Monthly	£19,838.46
Germany	Lufthansa	Lufthansa Magazin	54,164,071	604,990	1,385,000	Monthly	£25,808.37
UK	British Airways	Business Life	33,588,960	93,087	628,000	Monthly	£8,536.00
Total:			138,217,904	1,084,096	3,141,000		£54,182.83

Above are the costs of advertising in the in-flight magazines. If we take the total cost and divide it by the audience, we will obtain the cost per person, which will be 

£54,182.83/3,141,000= £0.02 per person

I assume, that I will be advertising for 1 year, therefore, the costs will be (£54,182.83x12)= £650,194

• Therefore, the cost of the proposed campaign will be: £650,194

However, there are several options with this, because the cost of my proposed promotional campaign may actually be nothing, if I pay for advertising the new Apple noise-cancelling headphones in the in-flight magazine, but sell these headphones an airline for money, which should cover the costs of advertising, because according to my research on average there are 219 seats in the airplane, which means that, for instance- three of my airlines altogether have about 100 airplanes and with the given price of e.g. £30 and an average of 219 seats in each airplane, there’s a possibility to generate £657,000 of revenue, which will fully cover the costs of advertising in the in-flight magazines, and in addition to this, I will be able to collect £2.00 per person for renting the headphones, provided there’s has been a successful negotiation with an airline.

(Revenue= 100 airplanes x 219 Seats on planes, and then times £30 price= £657,000)

• It will reach approximately about 37,692,000 people over the year

• Cost per person will be £650,194/37,692,000= £0.017= £0.02 (approx.)

• The data provided above clearly suggests that the costs of advertising on the airplane in terms of how many people it can actually reach are not that high at all, and it turns out to be 2p per person. Even, if the annual cost is £650,194 the number of people that it can approximately reach is above 37 million, which although it is fairly inaccurate, is still a very impressive figure. However, although I assume that according to the information provided by the IPSIS international, there are 37 million passengers a year, this figure in some cases might be bigger, if we take into the account those passengers to travel more than once or frequent flyers.

• According to “Macblogz” Apple’s marketing budget for 2008 was $486M, which is £353 million (http://www.macblogz.com/2008/11/22/apples-entire-ad-budget-486m-compared-to-vistas-300m/), which suggest that my proposed promotional strategy would only be either nothing, if the option of selling the headphones to an airline is chosen, or a very small percentage- 0.18% of the Apple’s total Marketing budget based on the figures provided in 2008, which may actually increase in the end of 2010, and the percentage the proportion % of my proposed promotional strategy out of the total Apple marketing budget might be even smaller.

Times scale and External Influences

Timescale involved and Economic influence

This is the second major factor for me and Apple. For this part I have provided some economic data in ‘Source A’ which is enclosed with this evaluation. It explains my further decision about the timescale involved in my promotion, and also when I’m going to launch my promotion and why.

Firstly, due to some external influences such as given economic recession in the UK, I would postpone the launch of the new Apple noise-cancelling headphones promotional campaign until the end of 2010, when the economy will partially recover from the effects of the current recession. Considering all current factors, it would be too risky to launch this promotional campaign this year, because there have been significant increases in the rate of unemployment in the UK, which according to the source A was 2 million people in 2008, and is predicted to rise up to 3 million in 2010. This, therefore, means there’s very likely to be a decrease in people’s disposable income and they will be less likely to spend their money on such luxury goods as new technology. There might also be less people who will be able to afford to buy the new Apple noise-cancelling headphones, because there will simply be less people employed. Therefore, with the given risk, it would be better for Apple to carry on with promoting or slightly cut promoting of already established products, rather than launching a new promotional campaign to introduce new Apple noise-cancelling headphones, because it will lead to high costs, and will take a long time to payback in terms of the time scale involved given the current economic recession. Therefore, it is more likely that extra market research might be need to be undertaken in the future if I was to create awareness and introduce the new promotional strategy in 2010, because the demand for this product as well as the cost and effectiveness of using air transport to promote Apple noise-cancelling headphones is likely to change over such a long period of time.

In addition to this, from the Source A it is evident that interest rates have recently decreased from 5.25% in January 2007 down to 0.5% in February 2009. Those people who will be on the airplanes and who will be involved in my promotional activity, are most likely to have a mortgage for house or a bank account. Generally, as the interest rate decreases, mortgage rate will also decrease, so the mortgages will be cheaper and people will have more disposable income, which should increase their propensity to consume and demand for goods and services including luxuries such as new Apple noise-cancelling headphones. In addition to this, people will be also encouraged to buy more goods and services, because due to a lower interest rate in the banks, so that they will be able to save less money in the bank and be more encouraged to spend it due to an inflation rate higher than the interest rate, because otherwise they would be keeping money in the bank and loosing it at the same time. Therefore, the demand for the new Apple noise-cancelling headphones might actually increase, and my promotion, in this case, will be useful and effective. Also, the fact that those people who use air transport would prior be able to afford to buy tickets which are relatively expensive, which suggests that if they were able to buy the tickets, even if there’s an economic recession and lower demand for luxury products, there’s still a chance that they might buy Apple noise-cancelling headphones, as it will be a much smaller percentage of the price of the ticket, in which case the effectiveness of my promotional strategy will not be affected to such a great extent. However, it can be arguably said, that people might not necessarily spend their disposable income on such products and the extent to which their demand for goods and services and luxuries such as new Apple headphones, will also depend upon consumers’ confidence, which might actually decrease due to an economic recession and instability. In this case, there will be a lower demand for such products as new Apple headphones due to a relatively high price charged for such products, and the effectiveness of my promotional strategy will also be very limited, because although the demand for air transport is a derived demand because some people simply have to travel a certain distance by an airplane to get to work or meetings, the demand can still decrease, which means there might be less passengers on the airplane, less airplanes used, which will overall decrease the demand for the new Apple noise-cancelling headphones and the effectiveness of both methods of my promotion.

From the information provided above, it can therefore be evaluated, that it would actually make it less risky, if I would postpone introducing my promotional strategy until the end of 2010, when the economic situation might be less vulnerable, and my promotional method will have more chances to succeed and effectively encourage more people to buy Apple noise-cancelling headphones, and create more awareness of the Apple brand and their new products. In addition to this, it is important to mention, that introducing my actual promotional strategy isn’t going to take a long time, as it has already been set up and it will only take from 1 to three months to negotiate the terms and conditions of my promotion and the way it’s carried out with the airlines.

However, if we are talking about the year 2010, if I was to introduce my promotional strategy then, I would introduce it from November just before the Christmas period, and also use my promotional method heavily during the Christmas period in December, because many people would be looking to buy some presents for their friends, children or relatives, and it my promotion could actually provide a good idea for some people about what to buy. If I was to introduce it in November, it means I would also start negotiating with the airlines earlier in August or September, to make sure the promotion will be definitely ready for November and Christmas period. Some people, for instance, could buy the new Apple noise-cancelling headphones for their friends who may be frequent flyers and might find this product quite useful, or buy it for themselves, or even use their air miles, to buy it as a Christmas present for someone. Taken into consideration various factors and provided that I have undertaken some research on the demand for summer holidays and found out the peak times, I would also use my promotional method more widely or on a larger scale, because there would be many people going for a holiday, and most of them could be traveling a relatively long distance to get there, and as they spend longer sitting in the airplane, they would be more encouraged to read an in-flight magazine, watch a movie or listen to the music, and, therefore be more likely to use or buy noise-cancelling headphones by Apple during their flight. This also suggests, that in this case it would be a good idea to introduce my promotional strategy on a wider range of airlines, and particularly the ones that are popular for long-haul flights and holidays, such as ‘Air One’, ‘Emirates’ or ‘Singapore Airlines’ for instance, who normally use big airplanes with a larger passenger capacity.

Social and Cultural influences

These external influences are more likely to have a positive effect upon my business rather than negative, because according to my own knowledge and experience, there has recently been an increasing trend in the popularity of the Apple brand as well, and just to show how social and cultural factors may influence the success of Apple as a business, as well as potential success of my promotional strategy, I decided to summarise some of the main facts, which identify increasing Apple popularity and provide some data and figures about the Apple’ growing shares on various markets, and their increasing sales, obtained from the secondary research: