Introduction-Apple
Apple Inc. is a company that deals with technology devices and software. It designs, manufactures, and markets computers, mobile communication devices and media devices. The company is known for selling a variety of related services, software, network solutions, accessories as well as third-party digital contents and applications. The products that are manufactured by Apple Inc. include iPhone, iPod, iPad, iWatch, ITV and Mac (Apple, 2018). The software and applications that are designed by the company include iOS, OS X and watchOS operating systems, iCloud as well as Apple Pay (Apple, 2018). It also sells Apple T.V. app stores. Through selling these products, Apple Inc. has emerged as one of the most dominant companies in the industry all over the globe. This article will address the business-level strategies of the organization as well as the corporate-level strategies. It will also discuss Apple Inc. competition and assess the impacts of slow cycle and fast cycle markets to Apple Inc. competition.
Business-Level Strategies of Apple
Apple Inc. business-level strategies are based on innovation. To Apple Inc., innovation does not imply that it dwells only on the creation of new products as a business-level strategy (Bartleby, 2018). Therefore, innovation to Apple Inc. involves the improvement and enhancement of the existing portfolio of products. Additionally, the institution does not dwell on the income drawn from new products but rather through consolidation as well as improvement of the current line of products in the market that they manufacture. For instance, the introduced iPad models, which are building on innovation, process as well as enhancing resolution and capacity (Bartleby, 2018). It also decreases the product size simultaneously. This is also witnessed in the iPhone brands. Their innovation on the new products is just similar to what is done to the iPads (Gov, 2018). It improves and innovates the existing models to come up with a slightly different smartphone.
Innovation is also profoundly witnessed, in Apple Inc. expansion of its software and applications. The company innovated an app store. They utilize their app store and the existing applications on the products they design and market to drive innovation such that the consumer can best benefit from the product as well as its use (Bartleby, 2018).
Similarly, Apple Inc. business-level strategy stresses diversification, which dwells on price and quality (Bartleby, 2018). This factor has painted the image of Apple Inc. to that of an exclusive product due to the two dimensions of price and quality. It is witnessed by the perception they have created in the market. The products that they sell are of the best quality, that is why they come at very high prices than the existing products in the market. As a result, their market strategy is committed to supporting diversification approach that involves bringing out superior quality products. The products grant the users better experience out of them (Gov, 2018).
Apple Inc. also utilizes its innovative strategy to create product designs that are significantly different from the ones existing in the market. They are not only presentable but also more acceptable for the users. For instance, Apple Inc. strategies in innovating laptop designs that are simultaneously sleeker and lighter with technological capacities that are either similar or superior to the current ones in the market (Bartleby, 2018).
Apple Inc. has also focused on digital music environment innovations as a business-level strategy. It has innovated products such as iMovie and iTunes that are supportive instruments behind the hardware that uses the music they commercialize. Apple Inc. created an entire mechanism that allows its hardware users to utilize applications such as iTunes to directly feed the music they liked into their Apple machines (Apple, 2018).
Apple Inc. business strategies involving innovation, diversification as well as design are primary reasons for the success of the company in the market. This long-term strategy will help Apple Inc. to thrive in the industry as long as possible. Therefore, the business-level policy is a right decision for the institution, as it will enable it to succeed in the technology industry and bypass their competitors.
Corporate-Level Strategies for Apple Inc.
From the corporate history of Apple Inc., the company has made several alliances with other companies including their rivals such as IBM and Intel. Out of these corporate strategies, two of them are the most prominent in the history of the organization. Its alliance with IBM and Motorola in 1992 which is also known as AIM (Apple-IBM-Motorola) alliance as well as its corporative alliance with Intel in 2006 (Matic, 2013).
The primary objective of the AIM alliance was to grant Wintel a competitive response. Wintel was a collaboration of Windows and Intel to create Personal Computers that are running Microsoft Windows and similarly equipped with Intel x86 processors. As a result, AIM was aiming at coming up with a next-generation operating system alongside an innovative design (Matic, 2013). It resulted in the Formation of Performance Optimization with Enhanced RISC-Performance Computing (PPC or Power PC) Central Processing Unit. The processors utilized these CPUs with high performance. Apple Inc. later innovatively used this product in its Macintosh System as well (Apple, 2018).
The company revealed the 2006 Apple-Intel alliance during the launching of Macintosh computers that were equipped with Intel microprocessors. Apple is prominent for its industrial innovation while Intel is the most substantial chipmaker in the universe (Bartleby, 2018). Therefore, the alliance was substantially a significant strategic one. Even though it benefited IBM through increasing its customer base, it was also vital to Apple Inc. It critically enabled the company to compete with its rivals like Hewlett-Packard and Dell because of the high performing Intel chips incorporated into Apple products (Matic, 2013). Consequently, the corporate-level strategy is critical to the success of Apple Inc.
Additionally, Apple Inc. uses vertically forward integrated strategy through its distribution channels, which are highly criticized for being expensive such as retail stores (Matic, 2013). Therefore, to stay vertically forward integrated; the organization has to commence controlling its costs. For instance, it needs to enter into lease contracts for its stores, which are less expensive. Similarly, to have reduced cost, the company has to proceed with its corporate-level strategy of outsourcing primary parts of its products as well as engage more suppliers to provide them with these critical components to be independent of a particular supplier. They should be suppliers that efficiently produce these components cheaply hence helping in cost reduction. As a result, Apple will continue benefiting massively from outsourcing as well as concentrating on its core competencies design and innovation.
Analysis of Apple Inc. Competitors
Business competition is found in every industry as well as every product category and every geographic market in the world. It is good news to the consumers and similarly the reason for innovations by firms. Apple Inc. competition is broad because the company designs and manufactures products categories that are significantly competitive in the market (Jurevicius, 2018). The products include smartphones, tablets, mobile payments, laptops, smartwatches enterprise software, as well as application software. There is a fierce rivalry between each product and Apple Inc. acknowledges that competition is the main threat to its profit margins and growth (Jurevicius, 2018).
Many companies produce smartphones just as if iPhones for Apple. They include Samsung Electronics Company, Huawei Technologies, LG Electronics Inc., Google Inc., OPPO Electronics Corporation, Lenovo, Vivo, Xiaomi Inc., Blackberry, Motorola, Sony, and many others (Jurevicius, 2018). Apple’s chief competitor in this category is Samsung with its Galaxy S generation Smartphones (Jurevicius, 2018). Other direct competitors of iPhone are Huawei, HTC, Google, and LG. The remaining rivals are either too small or target different consumer groups hence do not pose significant threats to Apple’s iPhones.
The tablet market is flocked by Samsung Electronics Company, Amazon.com Inc., Lenovo group ltd, Huawei Technologies, Barnes and Noble Inc., Asus Tek, Acer, Xiaomi as well as Sony Corporation and many others (Jurevicius, 2018). Despite the tablet industry indications of declining of the sector, Apple is recurrently its ultimate leader with more than 20% market share. Just like the smartphone world, Samsung’s Galaxy Tablets are the primary direct competitor to the iPads. In this category, Samsung has a market share of over 15% with Amazon the only among the top five to be able to grow its market significantly (Jurevicius, 2018).
Consequently, Samsung Electronics Company is the most prominent rival to Apple Inc. (Jurevicius, 2018). This is because the company is the main Apple’s competitor in Apple Inc. major selling products such as iPhones, iPads, and iWatch. The strategies employed by Samsung Electronics are closely related to the strategy used by Apple Inc. Samsung utilizes the Vertical Integration corporation-level strategy. While Apple Inc. is still purchasing components worth billions of sums of money from its rivals annually, Samsung Electronics does not behold on any other industries (Jurevicius, 2018).
What puts Apple ahead of Samsung in the industry is its ability to design, integrate, and outsource. Additionally, Apple is a more profitable company. This is because Apple Inc. recurrently succeeds in integration and design and has no small degree of risk in its products. This is because all of the Apple products contain programs that work efficiently and effectively with each other. Contrary, such programs do not integrate well with any of competitors’ products (Apple, 2018). This makes it easy for the consumers to keep buying Apple products and difficult for them to switch to other companies’ products.
The choice of Samsung Electronic being the most significant competitor to Apple Inc. when examined using the slow cycle and fast cycle does not change the leading competitor. This is because of calibrating the performance of Samsung industries with the other competitors in the market; Samsung remains the fiercest competitor of Apple Inc. When factors such as response time, cost, quality, and rate of innovation for the Apple competitors are examined through the fast cycle and slow cycle maintains Samsung Electronics Company as the toughest Apple Competitor. This is because Samsung industry can achieve all these factors efficiently and efficiently through its strategies, that slightly resembles Apple Inc. Approaches (Jurevicius, 2018).
Conclusion
Apple Inc. biggest strength is its focus on innovation, design, and diversification in the products they produce. They employ strategies that aim at providing quality products that meet the demands of the consumers. Their product’s quality is defined by the high prices they are sold. Apple Inc. biggest competitor is Samsung Electronics Co, Limited.
References
Apple. (2018, May 10). Apple . Retrieved from Welcome to Apple Support: https://support.apple.com/
Bartleby. (2018, May 10). Bartleby.Com. Retrieved from Business Level Strategies of Apple: https://www.bartleby.com/essay/Business-Level-Strategies-of-Apple-FKVJU6FBZ6PS
Gov. (2018, May 10). Apple Inc. Retrieved from United States Securities and Exchange Commission: https://www.sec.gov/Archives/edgar/data/320193/000119312515356351/d17062d10k.htm
Jurevicius, O. (2018, May 10). Full Analysis of Apple Inc. Competitors. Retrieved from Apple Knowledge: http://appleknowledge.xyz/apple-competitors.html
Matic, R. (2013). Apple Company- Corporate Level Strategy. Research Matic, 24-31.
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