Interactive Marketing and CRM Strategy at Apple Inc.

Introduction to Interactive Marketing

Interactive marketing represents a broad set of strategies implemented to increase the depth of information a company holds about its customers, and to use that information to better satisfy customer needs while improving the company's profitability. One of the most common practical applications of interactive marketing is Customer Relationship Management (CRM) — a tool used to gather and exchange information between a company and its clients.

The IT industry has been among the most responsive sectors to the development and adoption of interactive marketing and CRM. International corporations such as Dell, Hewlett-Packard, and Sony stand as proof of this trend. Apple Inc. has also implemented certain features of customer relationship management, but the company continues to encounter difficulties in communicating with customers properly and consistently. Further implementation of interactive marketing could help resolve these challenges.

Interactive marketing is a relatively new concept within the marketing discipline. It implies consistent, high-quality communication with customers. The general perception is that interactive marketing refers solely to web-based marketing strategies aimed at the online consumer — but online marketing is only one component of a broader interactive marketing approach.

The fundamental application of interactive marketing lies in its unique orientation toward customers, who are continuously consulted to provide and receive feedback about a company's products and services. This does not necessarily mean that an organization will develop and implement numerous customer management strategies all at once. Instead, the goal is to adopt a business philosophy centered on learning more about customers — their behaviors and needs — in order to develop stronger relationships with them. This philosophy is formalized through Customer Relationship Management (CRM).

This approach to marketing is highly effective because it draws customers into the company's operations directly. As one researcher observed: "There is general agreement among researchers that people have short-term attention spans of about 20% of what they hear, 40% of what they see and hear, and 75% of what they see, hear, and do… By stimulating multiple senses, and getting people more involved, it allows them to enhance their retention of information. Interactive programs fall into the 75% category because prospects hear music, sound effects, and verbal directions; they see text, graphics, and animations; and most importantly, they press buttons, calculate data, and type in information" (Lyons, 1993).

General Issues in Implementing Interactive Marketing

The first major challenge in implementing interactive marketing is identifying the need for it. What are the features or deficiencies of a company's current marketing system that create the need for interactive marketing and CRM? Companies must also identify the internal and external forces that could influence implementation. Will they be able to implement it independently, or will they require the services of a specialized firm — as Dell did by partnering with WPP? And how will success be measured?

Another key consideration is the organization's capacity to integrate interactive marketing into its existing operations. Specifically, can new strategies be aligned with the company's overall goals and established corporate culture?

Finally, the precise manner in which interactive marketing procedures will be implemented must be determined. Campaigns must be developed in a unique way that captures audience attention. Sony's approach — discussed below — offers a compelling example of such innovation.

Interactive Marketing in the IT Industry

The information technology industry was among the first to embrace interactive marketing and CRM. Companies producing both hardware and software quickly adopted these strategies, in part because the nature of their work made them more adaptable and better positioned to implement CRM than businesses in many other sectors.

Dell Inc.

Dell was one of the first major companies to pursue interactive marketing, and in doing so, the company reaffirmed the central importance of customers and marketing strategy. To ensure that its programs were well-developed and effectively implemented, Dell formed a strategic partnership with WPP, creating a joint venture specifically aimed at serving Dell's interactive marketing needs.

The impetus for this shift was the inefficiency of Dell's more than 800 marketing agencies — spanning communications, marketing, vendor relations, and sales support. Despite working with the same data, these agencies frequently produced contradictory findings. Given the data-intensive nature of Dell's business, the company engages in approximately five million customer conversations per day — over one billion per year — and claims to possess more information about its customers' needs and wants than any other company in the world (Interactive Marketing Trends, 2007).

Dell's open-minded, flexible, and customer-attentive culture contributed significantly to the success of its interactive marketing strategy. Although the company relied on an external partner to manage implementation, it succeeded in integrating that work fully within its established corporate goals and culture. The large numbers of satisfied customers who are continuously contacted and kept informed by Dell's marketing services stand as evidence of this success.

Hewlett-Packard Company

Hewlett-Packard's need for interactive marketing arose from the company's desire to improve the efficiency of its marketing operations and enhance corporate creativity. To achieve this, HP enlisted the help of San Francisco-based Goodby, Silverstein and Partners. The collaboration produced a powerful advertising campaign that was recognized by the Interactive Advertising Bureau, which awarded Goodby, Silverstein and Partners the MIXX Award for best campaign. Titled The Computer is Personal Again, the campaign successfully fulfilled its goals of increased creativity and marketing efficiency (Interactive Advertising Bureau, 2007).

The interactive marketing procedures and CRM strategies were seamlessly integrated into HP's existing marketing framework, expanding and complementing — rather than replacing — what was already in place. Goodby, Silverstein and Partners collaborated directly with HP's Imaging and Printing Group (IPG), with a mandate to "provide leadership, drive integration, and establish standards across IPG globally in traditional advertising and interactive marketing. Areas of focus include Search Marketing (SEM and SEO), Social Media, and cross-media effectiveness for IPG" (Personal Life Media, 2007–2008).

Sony Corporation

Sony is another company that successfully implemented interactive marketing and CRM. What was particularly notable about Sony's approach was that it did not partner with a traditional marketing agency — instead, it worked with Google. "Sony Pictures partnered with Google last year for the theatrical release of The Da Vinci Code to develop this promotion. Google created over 12,000 separate puzzles, and players used Google Maps and search functions to find clues. Over one million unique users signed up to crack the code — well exceeding Sony's goal of 100,000 — and they played nine million puzzles" (Donna's Promo Talk, 2007).

The campaign offered numerous prizes, including Sony products and international travel experiences. Its success was also attributable to the creative skill of its producers, who sustained audience interest by maintaining an air of mystery throughout the campaign. As a result of this unique and highly effective approach, Sony received the Best Interactive Marketing Campaign Award from the Interactive Promotion Summit.

In each of these three cases, the implementation of interactive marketing supported the companies in developing and strengthening their customer relationships. After launching their respective campaigns, Dell, HP, and Sony each improved the quality of their CRM practices and became better equipped to identify and address the needs and expectations of their customers.

CRM at Apple Inc.

Apple Inc. is among the world's most recognized corporations, with decades of history and a strong international reputation supported by a powerful brand. The company operates within the IT industry, and its most successful products include the original Macintosh, as well as more recent innovations such as the iPod and iPhone. Apple's operations are fundamentally built on processing data and developing new technologies that can be incorporated into products designed to meet as many customer needs as possible. To achieve this, however, the company must be able to communicate effectively with its customers in order to identify what those needs actually are.

The totality of procedures implemented to improve the quality of these communications and interactions is organized under CRM, or Customer Relationship Management. The core purpose of CRM is to identify and serve client needs in such a way that customers are motivated to remain loyal to the organization. As one source describes it: "The basic idea was to find out what a client wants and needs, give it to them, and get them to be your client for life" (IntelliNova). However, in a rapidly changing market filled with intense competition and constantly evolving customer expectations, achieving genuine customer loyalty is increasingly difficult — and this is precisely why Apple needs to develop and implement stronger CRM policies.

Current Features of Apple's CRM

Given the technical nature of Apple's products and the fact that many customers require additional support after purchase, Apple encourages all current and prospective customers to direct their questions and complaints to an Apple representative. The company's website provides detailed information on how customers can contact a service support department in both Canada and the United States.

For a specified fee, Apple customers can also subscribe to AppleCare, a service offering extended support for Apple products. Many customers report high satisfaction with the quality of this support. As one customer noted: "I have never had a bad experience with Apple customer support. When my iMac wouldn't start up, the phone service guided me through reinstalling the OS from a disk, and all my files were preserved" (Macbook Random Shutdown, 2008).

One characteristic of Apple's support system that could be viewed as a limitation — though it is understandable and does not constitute a major structural problem — is that Apple does not actively monitor discussions and comments posted on its corporate forum. If a customer encounters a problem, they must contact an Apple consultant directly rather than simply posting a message on the forum and waiting for a response. Online support is nonetheless available, and customers can submit questions through Apple's website and expect a response from a trained representative in a timely manner.

Apple has also demonstrated an effective use of interactive marketing in its promotional campaign for the iPhone. Through a combination of television and online video presentations, media appearances, and the careful cultivation of anticipation and mystery around the product launch, Steve Jobs successfully generated significant consumer interest and engagement ahead of the product's release.

Conclusion

The problems presented within Apple's CRM, deriving from dissatisfied customers and revealing a rather inconsistent quality of service support, could be resolved through the deliberate implementation of interactive marketing. These procedures would help the organization communicate more effectively with its customers, identify their needs and wants more accurately, and address them in ways that benefit both parties. The experiences of Dell, Hewlett-Packard, and Sony demonstrate that when interactive marketing is thoughtfully integrated within a company's existing culture and goals, it has the power to transform customer relationships and drive long-term loyalty. Apple, with its scale, brand strength, and technological capabilities, is well-positioned to achieve the same outcome — provided it commits to a structured, customer-centered approach to CRM reform.

References

Hafner, K. (August 23, 2007). AT&T overstuffed iPhone bills annoy customers. The New York Times.

Lyons, C. (1993). Disk-based, interactive marketing yields greater response rates. Business Perspectives, Volume 6.

Payne, A. (2006). Handbook of CRM: Achieving Excellence Through Customer Management. Elsevier Science and Technology Books. ISBN: 9780750664370.

CRM = Customers Don't Really Matter. IntelliNova.

April 30, 2007. Live from the Interactive Promotion Summit: Sony Pictures Da Vinci Code Quest takes Best Interactive Marketing Campaign Award. Donna's Promo Talk. http://www.donnaspromotalk.com/donnas_promo_talk/2007/04/promos_2007_int.html

February 17, 2008. Customer service complaints? Apple's forum for discussions. http://discussions.apple.com/thread.jspa?messageID=6635560

January 25, 2008. Unexpected dead battery. Macbook Random Shutdown. http://www.macbookrandomshutdown.com/category/customer-relations/

May 5, 2005. iBook: Apple customer service sucks. Mac Rumors: Forums. http://forums.macrumors.com/showthread.php?t=127835

September 28, 2007. Hewlett-Packard and Goodby Silverstein take top honors at the MIXX Awards. Interactive Advertising Bureau. http://www.iab.net/insights_research/iab_news_article/20229

2007. Can Dell save marketing? Interactive Marketing Trends. http://interactivemarketingtrends.blogspot.com/2007/12/can-dell-save-marketing.html

2007–2008. Diana Middleton: HP Marketing Director. Personal Life Media. http://personallifemedia.com/guests/863-daina-middleton

2008. QCi Assessment. http://qci.co.uk/public_face/

2008. Official website of Apple Inc. http://www.apple.com/