Apple Business Environment

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Table of Contents

Executive Summary
Introduction
Competitive advantage
Data, information, business intelligence, and knowledge
Porter’s market forces
Generic strategies
Conclusion
References

Executive Summary

This treatise reviews the Apple’s business environment with reference to generic strategies, Porter’s five forces, and competitive advantages. The iPad and iPhone products are geared towards market dominance. Through this approach, the Apple Company will automatically have the discretion to reap maximum benefits ahead of its closest competitors.

The company has adopted trend creation strategy, technological innovation, and different marketing strategies to ensure that it remain the market leader in the PC industry. Given its numerous stores, reliable customer base, and a stable market niche, Apple has the capacity to offer affordable and reliable products to its customers.

Its main competitors are the Blackberry, Samsung and the Nokia companies. Apple is the leading company in the PC industry in terms of design and innovation due to applied business intelligence.

Introduction

Reviewing the business environment of a company is critical towards ensuring sustainability, competitiveness and profitability. This analytical treatise will attempt to explicitly review the Apple’s business environment from the micro and macro perspectives.

Among the vital elements that will be reviewed include product development, market segmentation approach, and product cueing in the competitive global PC industry. In addition, the treatise reviews Apple’s main competitors and how the Porter’s five forces influence its market position.

Competitive advantage

The Apple’s iTunes, iPhone apps, and iPad apps give the company a competitive advantage over its competitions since the company is in a position to create a barrier for its competitors by proliferation the products. For instance, this strategy was beneficial for the Apple Inc Company when it became the first company in the world to provide online music services through its creative iPod and iTunes products. As the first in the online music service, the company reaped from the first mover advantage and expanded to countries such as China, UK and South Africa (Kluger 2011).

Data, information, business intelligence, and knowledge

Reflectively, data, information, business intelligence, and knowledge are very important to Apple Company in relation to the iPad product. Since product development entails the innovation process aimed at modeling the existing product or improving on it to balance with the changing preferences of the customers, data on customer preference and behavior was vital in the development of the smart iPad product.

As a matter of fact, Apple is the leading company in the PC industry in terms of design and innovation due to applied business intelligence. For instance, the company is associated with new innovations and attractive design in the iPad product that appeal to their customers across the world (Kluger 2011).

The Apple Inc Company has benefited from this strategy in terms of market expansion, especially among its early adopter customers. Specifically, through product development as a result of knowledge, the Apple Inc Company has been in a position to optimally exploit opportunities available in the innovation market segment and has gained a significant share in the mobile PCs market with its iPad product (Kluger 2011).

Porter’s market forces

Threat to market entry

It is difficult for any aspiring PC company to enter into the industry in the US market and manage to break even easily. In the US, the Apple’s business magnitude together with that of its main competitors such as the Blackberry, Samsung and the Nokia are well established and would easily enjoy economies of scale to the disadvantage of a new entrant (Baltzan 2014). The Apple Company is well position to survive in the competitive PC market through gaining form economies of scale, competitive price tags, and strong customer base in the entire globe.

Threat of substitutes

Samsung poses the greatest threat to Apple’s existence and business performance. Samsung has been in the industry for longer period and is well established than the Apple Company. Samsung has the same PC products and sometimes offer bigger discounts to customers than Apple. In the global PC industry, loyalty to a brand plays an important role in customer behavior (Baltzan 2014). Therefore, Samsung has the ability to offer an alternative perfect substitute to customers who may be unsatisfied with the prices offered by Apple.

Power of suppliers

Suppliers in the global PC industry have more power owing to the existence of many PC companies. As a matter of fact, suppliers may instigate market demand and supply variances due to difference in price tags for different PC products. This leaves the suppliers with the power to dictate on proceedings in the PC industry such as the price tags and distribution channel development (Baltzan 2014). However, the Apple Company has endeavored to use its deep reservoirs as a strategy for balancing the supply forces in the fragile global PC market.

Power of buyers

Reflectively, the amount of output in terms of turn over sales depends on the buyers’ purchasing power. The higher the purchasing power, the better the turnover in total sales realized over a definite period of time. Apple’s performance in the US and global PC industry depends highly on the power of the PC users.

In fact, the purchasing power determines profitability and probability of survival of a business in short and long term (Baltzan 2014). Fortunately, Apple has developed a unique market niche from the technology gauchos and early adopter of latest personal computer technologies across the globe. Currently, the iPad, iPhone, and iTune products have a cult like following among the young adult global market segment.

Rivalry

There are several PC companies operating in the same industry with virtually all of them dealing in a variety of PC products and services. For instance, Samsung provides the biggest competition to Apple due to its big market share, affordable prices for its products and expanded network.

With many customers looking for good value for their money, quality in service delivery has remained the main basis upon which customers are making their final decision to purchase PC products in the expansive PC industry of the globe (Baltzan 2014). In line with this, the Apple Company has heavily in invested in technological development in its smart PC products line.

Generic strategies

Apple’s strategy in marketing its products relied on the assertion that “products don’t just perform, they actually exhibit behavior” (Kluger, 2011, p.34). This exhibits the nature of niche marketing by focusing on utmost premium quality that customers demand or may not know that they require at that time. The company emphasized on creating trends. Apple’s iPad and iPhone series have become a symbol of status and culture across the global PC industry.

The Apple Company addressed the threat of substitutes through its introduction of the iPhone since Samsung had the same smart technology which it used in mass production of the cheap smart phones.

The Apple Company addressed the power of buyers through its customer-developed applications. With many customers looking for good value for their money, quality in service delivery remains the main basis upon which customers make their final decision to purchase PC products in the expansive PC industry of the globe. Thus, Apple had to develop customer based applications to use the power of buyers to its advantage.

Conclusion

Conclusively, the Apple Company has strong presence in the global PC industry. The company has successfully used the Porter’s five forces and generic strategies ensure completive advantage over its rivals such as Samsung, Nokia and Blackberry among others.

References

Baltzan, P. (2014). Management information systems: Business driven MIS in Business Driven Information Systems. Web.

Kluger, J. (2011). Beauty and the Bytes. Time: Special Commemorative Issue, 16(2), 30-35.

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