Beats By Dr. Dre Marketing Strategies

Marketing Strategies for “Beats by Dr. Dre”
Name
Institutional Affiliation
Marketing Strategies for “Beats by Dr. Dre”
Introduction
Market analysts continue to question the decision by Apple to purchase the “Beats by Dre” franchise at the cost of more than $3 billion despite its questionable financial performance in the United States market. The acquisition is undoubtedly Apple Inc.’s largest reported buyout although the tech company rarely announces its financial dealings. According to market observers, the total amount of the headphone business amounted to approximately $2.5 billion in addition to the $500 million paid to own Dre’s music rights. One of the considerations that led to Apple’s purchase of Beats was the presumed profitability of the company in the previous financial years. Carr (2013) points out that financial forecasts suggested that the headphone company made about $1.5 billion in revenue between 2013 and 2014, and such profit margins indicated that Dr. Dre’s company was a dominant player in the headphone market. The company sold more than 20 million speakers and headphone units before Apple Inc. bought it in addition to buying back its shares held by HTC and Monster Cable. However, reviews on the financial performance of “Beats” by companies such as PrivCo suggest that the headphone company’s financial condition was worse than indicated in various media. As Rogowsky (2014) reports, market observers pointed out that the headphone company was on the verge of bankruptcy in 2013 due to poor sales and the transition into manufacturing hardware products such as the pill speakers and headphones.
Category of “Beats by Dre”
“Beats by Dre” can be categorized as an improvement to an existing line of products based on the “How New is New” subject. The headphone company, currently one of Apple Inc.’s portfolios, specializes in selling music was well as selling wireless earphones, pill speakers, and headphones to its target market. Many companies dominated the music industry before the establishment of the “Beats by Dre” company. However, the company reinvented the music and video industry by enhancing the synchronization of music playlists through various platforms of portable devices such as mobile phones, tablets, and laptops among others. According to Bodea, Purnus, Huemann, & Hajdu (2016), the improvement of existing products includes radical and incremental innovations based on the level of change implemented on various products to enhance their functionality or aesthetic values. Beats by Dre sought to implement radical and incremental improvements on audio devices such as speakers and headphones by manufacturing products that could play music wirelessly to enhance the user experience. Initially, the audio devices were wired, and this led to numerous inconveniences to the consumers. The radical innovation adopted in the company’s products was the introduction of wireless technologies in the audio devices while the increme...