Example of a Case Study: Personal Application

Concrete experience

Towards the end of the year 2012, Apple inclusive experienced a drop in the iPad UK market share (Bryant, 2012). Apple Inc, wanted to ascertain the cause of the drop. I worked in a team that sought to find out the effectiveness of the Apple Financing program that gave loans to customers to buy Apple products. It sold products on credit. By offering products on credit, a certain percentage of customers would choose to buy on credit because it is available instead of cash. Apple earns an interest rate of 14.9% because of allowing the customer to purchase on credit. My responsibility included collecting data about the company since the program started. Some of my colleagues were involved in interviewing customers on the benefits of the program. We used percentages to determine the effectiveness of the program. We drafted questionnaires for customer satisfaction interviews. We also drafted a mini-budget for the evaluation process.
Brief description of the program

Apple, Inc. uses the consumer finance program to increase affordability of its products to U.K. residents. The program is almost similar to hire purchase without the initial deposit. The payment for the products is made through monthly deductions from customers’ salaries. The company’s marketing slogan states, “Pay for your Apple products while you use them” (Apple Financing, 2013). The product that a customer chooses to buy must be worth at least £ 429. Customers can apply for the program through the Apple Online Store or an authorized Apple Reseller.

The loans range up to £2,000. A person who has been given a loan of £2,000 pays £95.95 monthly for 24 months. The interest is fixed at 14.9%. A person with a loan of £500 pays £23.99 monthly for 24 months (Spreading the Cost with Financing, 2013). From these spread costs, affordability has increased. The target groups are students and low-income earners.

A U.K. resident must have a full-time paying job to qualify for the application. One must be aged over 18 years when applying. The resident must have stayed in that location for at least three years. One must own a bank account that accepts direct debits. One must also have a home delivery address (Apple Finance, 2013).

The objective of the program is to ensure that Apple customers are able to afford its products because of spread cost. Royse, Thyer & Padgett (2010) describe such a program as “an organized collection of activities designed to reach certain objectives” (p. 5). The company expects that its sales will go up by about 50% to 100%. It is a market penetration strategy. Consumers who had never owned any of Apple’s products are able to have an experience of their quality.

Apple needed the evaluation to conclude that the program has enhanced profitability. Royse, Thyer & Padgett (2010) discuss that decision-makers consider whether a program has achieved its objectives. They check whether the same goals could have been achieved at a lower cost. The company is involved in continual inventions, it would like to benefit fully on every new piece of technology it launches. It is willing to ensure that its products capture the largest market before new inventions renders them obsolete.

The evaluation process sought to find out if Apple had achieved a larger market share through the program. It may have reached into a new market segment because of the program. The evaluation process also considered customer satisfaction due to the program. Credit involves risk that should be rewarded with a premium. The evaluation measures whether the company earns more to offer the products in credit than to keep them in store.

Aim of the evaluation

The evaluation sought to find out whether the company earns more by selling products on credit than it would receive by relying only on cash sales. The evaluation sought to find out if the program had increased customer satisfaction. The evaluation process was used to “identify strengths and areas that need improvement” (Program Evaluation, n.d. 11). The evaluation process is more effective when carried out for an ongoing program rather than one that is being planned.

The total number of iPod sold since their invention is about 350m, iPhone about 192.6m, 400m IOS devices and iPad about 84m (Sloan, 2012). In 2011, the revenues amounted to $108.249 billion (Apple Computer Company Statistics, n.d).

Logic of the evaluation

By Apple selling its products on credit, it may have reduced a certain percentage of the cash sales. The overall sales may have increased but the sales revenues are delayed. The evaluation examined whether the additional cost that customers who buy on credit give is worth the risk and the delay in payment.

Program evaluation structure

The program evaluation structure began with the description of the aims of the evaluation. The aims of the evaluation process measured whether the objectives of the program had been achieved (Program Evaluation, n.d.). The core concepts of the program included a market penetration strategy. Apple tries to make its high-valued products affordable to a low-income group with constant employment.

The key indicators included customer satisfaction, number of products purchased through the program, products purchased through cash sales, the revenues received from the program against the cost of production, and the rate of default by customers.

Methods & Sources

Customer satisfaction was surveyed through questionnaire where customers were asked to answer questions that give the impression of satisfaction. The customer compares a product from Apple that she/he bought for cash against one on credit. They inquired about out the number of products they had bought on credit from Apple. The evaluation considered whether the customer felt that the product on credit was over-priced. The number of products purchased through the program was collected from a segment of the market. It was aimed at reducing costs rather than conducting the evaluation from the entire country. The data for the other indicators were obtained from the sales and marketing manager…”

 

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