Apple Inc.
Most of us remember the days in which Apple Computers was one of the companies who appeared to be standing on the shadow of giants like Microsoft and Dell. Today, Apple is considered one of the major players in the computer and consumer electronics industry. While some may argue that Apple´s success is based primarily on their high-quality and innovative products, their approach to their marketing channels was, and still is, one of the company´s key advantages. Before Steve Jobs returned to Apple in 1997, the company had relied heavily on a four-level channel structure where Apple products had to go from the manufacturer (Apple), to a wholesaler (E.g. Ingram Micro), to a retailer (E.g. CompUSA), and finally to the end consumer. After restructuring their distribution strategy, Apple started offering its product through a multi-channel strategy. While the company decided to keep its four-level channel structure, it added three-level and two-level channel structures using Apple Stores and the Online Apple Store (Schmidt, 2008). This reduction of intermediaries reduced costs associated with distribution and gave the company more control over its marketing efforts. The result was an increase in Apple’s profits and, consequently, and an increase in Apple’s power in the consumer electronics industry. Nonetheless, even when Apple used narrower channel structures on its multi-channel strategy, it still uses many members in its ancillary structure such as shipping companies, insurance agencies, and others organization that have a level of specialization and contractual efficiency that is beyond Apple’s reach. In conclusion, a redesign in Apple’s marketing channels, among other variables, transformed the company into the gigantic organization it is today.
Works Cited Schmidt, E. (2008, May 4). Apple's Success = Design + Distribution. Luxury Bauble.