Using Apple’s SWOT to Your Advantage
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Introduction
Apple Inc is a company that deals with the manufacture of a number of consumer electronic products. This may deal with a variety of software and Hardwares. The Company exists in a competitive environment; it is in constant competition with IBM, Intel and other Information technology companies. It is therefore necessary to understand the environment in which the company thrives that is; the micro and macro environment suppose one intends to be its rival (Hedggre, 1998). It is also vital to understand its operational functions that have maintained it in the global map and so the reason for this analysis. It is therefore paramount for the competitors to understand theses factors to aid them in designing new strategies to compete it.
Strengths
Apple has had numerous strengths and so the company has dominated the market for a long time. To commence with, the performance of the company has been great as a result of the quality of products they release into the market. This has uplifted the stocks related to information technology companies thus being of benefit to other companies. The company has seen its market share improve over the years as evidenced by reports and other types of data (Hedggre, 1998). Second, since Apple Company exists in an evolving environment, it has to be flexible. The company therefore has to continually change its mode of operations in order to remain competitive. This is done through continually evaluating the micro and macro environment.
The company is very dynamic and always striving to introduce a new product in the market so as replace existing older versions. That is, the company tries to keep abreast with the technology and ensures that its customers enjoy new and quality products. This is very evident from the way a transition occurs in the company’s inventions (Derrich, 1992). The company therefore, I can say relies on the “transition always theory” this ensures that older products pave way for new arrivals. Firstly, when the company developed the Macintosh computer and before it could pick up in the market it had introduced the LaserWriter and a PageMaker, both which were meant to foster desktop publishing packages. With the successive and consistent introduction of new technologies, Apple was seen as a shoot-straight firm, not missing any step as far as technological changes are concerned. Despite the stiff competition emanating from rival companies, Apple has maintained its focus to continue flourishing and possibly escalate its technology to an extent that its competitors could not match (Benner, 2001). This is evident through such technologies as the upgrading of its Operating System so as to offer homogeneous platforms and execution environments. It proved that it wasn’t getting anything wrong. This was such a remarkable advancement.
Thirdly, the company manufactures products that aim three basic industries namely, computer hardware, and Computer software and consumer electronics. The company acts as one stop shop for clients who needed these products. It is noted that Apple also subsidized its prices hence a subsequent increase in the customers’ purchasing power. And so the strengths of the apple company include the huge profits that have arisen from the sales of the ipods, Macintosh computers and its notebooks. This has raised a considerable amount of money to the tune of 320 million dollars (Derrich, 1992). The brand of a company is the most distinguishing factor in its identity. Apple is branded as the most established and healthy IT organizations in the world. This relates to economic and social environment. The strengths of Apple distinguish it from other firms (Hedggre, 1998).
Fourthly, the current market position of Apple Company is highly reliant on Steve jobs return in the CEO position. That is, in the process of the company back to the market introductions of innovations has been unveiled together with the associated marketing campaigns. More so, the company has also gone back to undertaking approval of development guidelines associated with product development which has also considerably contributed the rise in market status for this company (Benner, 2001).
Another strength (fifth) of Apple company is financial vitality where by funds are always stable and strong regardless of whether the market is dormant or not. The apple company defies the market demands to minimize cost by practicing marketing mix and form associations with other companies. Brand loyalty is strength of the apple company whereby the company brings in unique brands to the customer base thus making it extremely difficult for other companies to imitate its brands (Hedggre, 1998).
Weaknesses
Though these strengths, Apple Company has some weaknesses. The weakness that are associated with Apple Company are its faulty screens that crumble under pressure however efforts have been made to correct this anomaly and compensation issued to the affected customers. Early ipods had faulty batteries which could not store power for a long period of time.
The other weaknesses of Apple Company is market share whereby the company experiences external pressures and challenges which in due course forces the company to utilize a lot of cash trying to reach the market demands. This cash go wasted with no advancement of the products (Derrich, 1992).
The third weakness is Steve jobs. Jobs is taken as strength in the apple company because of his innovative strategies hence his absence is a very strong weakness to the company since his aggressiveness to bring in advancement and creativity in the company is no longer there. This is taken as a big blow to the shareholders and the company at large. The forth weakness of Apple is the small memory of its machines. This has left most of the clients unsatisfied with downloads. The higher price of its computers can be regarded as yet another weakness. Few customers have been retained as a result. This has given other companies competitive advantage over it (Benner, 2001).
Opportunities
The opportunities that are available to Apple are numerous. It has the ability to develop its iTunes and music players into a mobile phone format. The high product substitution of electronic products in the market is critical for the technological environment.
The two strongest capabilities (opportunity) of Apple Company is a situation whereby it is in a position to undertake and maintain innovativeness. This has allowed the company to come up with new products most of which are modifications from those already available in the market. In this case, Apple Company is capable of venturing into wider and larger markets through this rate of innovativeness (Benner, 2001). Another of Apple Company’s strongest capability is that of technological advancement whereby the company has been on the front line in familiarizing itself with advanced technology and consequently applying in its production arena.
The other opportunity of Apple Company is technical know-how. This is whereby the customer is aware of the products offered by Apple Company. This is made possible by the company when it displays its skills and enthusiasm to different potential customers. Mostly this can only be archived by applying promotions strategies (Derrich, 1992). By using this strategies which are very rare and which need technical proficiency, other companies find it very difficult to imitate thus giving apple company the monopoly to run it business successfully. New products can hence be manufactured frequently and with respect to by then technologies (Benner, 2001).
The other opportunity of the Apple Company is consumer electronics. The Apple Company engaged its customer electronics market by enlarging its tunes notion to aspects which can be downloaded (Derrich, 1992). This brings in opportunities for expansion of its products by forming coalitions with potential manufacturers. Another opportunity is of the Apple company is PC hardware. The PC hardware was established by Windows PCs but the apple company broke the domination of the Windows PCs by forming an alliance with the original company. More so, the situation whereby Apple Company enjoys achievement of steadiness and loyalty in their business functions is a good opportunity, an effort that the original company fell short of (Benner, 2001).
A promising opportunity for Apple Company to pursue is winning a greater market through price reductions while at the same time ensuring that high quality is maintained. It is necessary for Apple Company to pursue this particular opportunity in order to attract more customers most of whom are willing to purchase its products but put of by the high prices. This opportunity is also in a position to cultivate a rather wide diversity of customers which the company is deficient of (Hedggre, 1998).
Threats
There are two major competitors to Apple: Microsoft and IBM. The two companies proved great menaces for Apple that it had to redefine its strategies as far as market competition is concerned. They offered similar products as Apple thus introducing what is called atomistic competition .This kind of competition had a resultant reduction in the prices of products simply because the customers now had alternatives and that they could not rely on one producer monopolizing the market. Microsoft gained a substantial share of the market with their windows systems while maintaining focus on the delivery of heap products for personal computers (Hedggre, 1998). In contrast, Apple delivered richly engineered and yet expensive software in the essence. This shifted the customers’ attention to fall for cheap products from Microsoft which was now gaining momentum in this industry.
Threats from future technology advancement and emergent of other more advanced companies are currently a threat in Apple.
Legal risks are one of the threats of the apple company. The joining of operating systems and software correspondences makes it easy for other companies to do imitations hence possible lawsuits can not be prevented (Derrich, 1992).
Competition is another threat of the apple company. The apprentices to the business cause challenges and stiff competition to the existing company thus making it difficult for the existing company to run smoothly (Hedggre, 1998). Porter portrays that the customer is an important aspect of the micro environment, the bargaining power of customers puts the Apple firm under a lot of pressure this is due to the fact that customers are more sensitive to changes in the price. The bargaining power of customers brings into focus the buyer concentration ratio (Benner, 2001).
Proposed strategy
Great improvements have to be made to compete with apple Company. The several strengths and opportunities appear as threats to a new business. However, other businesses have to exist and so the following strategy can be used to compete Apple.
First, it would be important to emphasize the qualities that go in line with successful strategic management especially among managers in Apple organization (one of the weaknesses of Apple that made their product rejected). These qualities need constant education and enlightment in line with the changes that are perceived in the environment and technology. This will ensure the customer retention and satisfaction (very vital element in marketing) (Derrich, 1992).
The strategies that are employed by Apple group aren’t flexible. I would go for flexible and easy to change strategies because the world that we are currently living in is bound to changes either in the macro environment or the micro environment. The Vision of New Company therefore has to be broadened to adapt to conditions. There is also need for New Company to form new roles and relationships among suppliers, customers, business partners and allies in order to produce innovative ideas (Hedggre, 1998). Apple Company can completely be outperformed only when New Company determined by their clients and customers that it can preserve, this therefore calls for strategic positioning of the New Company (Benner, 2001). This is based on the customer’s needs, customer accessibility in relation to the products that are offered by the Apple Company.
I would as well sell my product at relatively lower prices. This will ensure that greater market area is covered (Hedggre, 1998). As well, in the manufacture of a new product, I will make sure that the capacity is more than twice what Apple offers (weakness of Apple). The customers with greater need of download will hence prefer the new product.
In conclusion, SWOT analysis is helpful in designing new strategies in a fresh company. The SWOT analysis of apple has revealed much concerning that company. The new strategies have taken advantage of the threats and weaknesses of Apple.
References
Benner, M. (2001). Moving Technologies to greater heights: Analysis of the advancements of the Apple company. New York: Touchstone.
Derrich, K. (1992). A look into the management of Apple Company: The secrets of its success. London: Falmer Publishers.
Hedggre, P. (1998). Technological Changes of the Apple: A New Technological Sunrise. Chicago: Chicago University Press.
