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Apple Inc. (Apple), incorporated on January 3, 1977, is responsible for designing, manufacturing, as well as marketing personal computers, mobile communication devices, portable digital video and music players as well as providing networking, peripheral or software solutions. The Company has a comprehensive marketing channel comprising of own retail stores, the use of sales force, online stores in addition to third-party value added resellers. In addition, the Company sells a variety of third-party Macintosh (Mac), iPhone and iPod compatible products, including application software, printers, storage devices, speakers, headphones, and various other accessories and peripherals through its online and retail stores, and digital content and applications through the iTunes Store. The Company sells to consumers of all walks of life such as small and mid-sized businesses, education institutions, governments as well as creative customers (Whitney, 2010).
According to the history of the company, the corporation has come a long way. From the beginning Apple Inc. set on fire the revolution of personal computers. Following the invention of the Apple II in the early 1970s, Apple was also able to restructure the world of personal computers after unleashing the Mac in1980s. Over the years, it has been found that Apple is devoted to ensuring that it provides the most excellent personal computing experience all its customers around the globe. Apple has been able to achieve this following the Internet, Software and hardware offerings. At present, Apple persists to direct the business in novelty with its high-quality computers and other professional applications. In addition, Apple may be viewed as the spear header of digital media revolution after being the first to market its iPod - a portable music and video player. Apple also owns a large store of online iTunes, which is enough evidence that Apple has been able to penetrate and permeate the mobile phone market after unveiling its new iPhone (AppleInsider, 2010).
Apple’s entire market is segmented into different categories; small and medium-sized business, home users, inventive individuals and younger generation users also referred to as “Mac users” and the education segment. The concept of the apple retail store has assisted customers to have a glimpse at the stunning products as well as experience and directly use Apple’s software. Apple Inc. has a successful line of products consisting of iphone series, iMac, iPod, Macintosh and iPad brands. However, some two remarkable products produced by apple namely Apple TV and Mac Mini failed to meet the company’s expectation, which was a big failure for apple.
One of the greatest strengths of Apple is being a great design pacesetter, always being ahead of trends as well as developing ergonomic electronics that always performs well in the market. Purposely, Apple has significantly invested over $80 million in research and development on new products during the 2011 financial quarter. Apple has for years now enjoyed a strong global brand name, a situation that has been propagated by developing high-tech quality and innovative products line iPad, iPod and iMac. In order to maintain its large base of customers who believe in the “apple culture." Apple ought to carry on with its innovative products globally. Since there is a fast growth of mobile technology in various asian countries such as China and India, it would be a smart move if Apple focused on mobile devices in such asian markets (Reuters, 2010).
Apple admits that its profitability is highly reliant on the global economy. Instances of economic meltdowns may cause considerable negative outcomes on the company, and variations in foreign currency results in uncertainties as far as predictions in foreign markets are concerned. Notable to Apple’s weaknesses was the failure of two major products namely the Apple TV and the Mac Mini. Furthermore, despite having a lower market share as compared to its major competitors such as Microsoft, Apple’s prices for its software and hardware has always been high. In order to maintain its competitiveness in the market, there is a need for Apple to shift its attention and focus on the international market’s buying power. The company should embrace medium pricing strategies, especially for the price perceptive asian market as well maintaining medium-high prices for a similar European market (Lewis, 2007).
According to Etherington (2010), Apple, Inc. has been able to maintain a strong presence in the United States as well as some other parts of Europe. The company has been unable to break the international barrier by introducing its product in the Asian market. However, most recently, Apple is anticipated to launch a new mobile promotion platform for the iPad, iPod touch and iPhone. The preamble of this advertising proposal characterizes an opportunity for fresh sources of revenue. There has been an increase in global demands for online music as well as other applications-like cloud-based services. Such demands coupled with the growing market for energy-efficient and green products have presented various opportunities for Apple to launch new products in future (Etherington, 2010).
In the recent years, Apple has been actively involved in numerous legal actions, as well as lawsuits claiming antitrust violations and infringement of patents. Most of the suits involve smaller companies as well as remarkable plaintiffs such as Nokia. The presence of such lawsuits has always been a threat due to the possibility of inauspicious judgments as well as the substantial costs in terms of legal fees. The presence of high effect of product substitution has had a drastic effect on Apple’s products, especially in the current competitive and innovative technology market. Apple has and continues to face challenge and competition in technology from major PC players such as Lenovo, HP, Dell, and other mobile technology giants such as Nokia and Samsung. To neutralize such threats, Apple should consider strengthening the connection with other major industry PC players such as Microsoft and Intel along with entering into joint undertakings with others like Motorola and Samsung, to introduce fresh “Hits” (Latest Gadgets, 2010).
Although Apple has been known for its unique technology, high-quality revolutionary products, the price premium cannot be always commanded by Apple. Introductions by competitors' forces have forced the company to rationalize its pricing for its super seller products like iPhone. Even though Apple can command a premium initially for its revolutionary introductions, it has to bring down its pricing in light of the competitive offerings that are sold at lower prices. Price war is inevitable in consumer electronics and computing industry and even technology and innovation leaders like Apple have to succumb to pricing pressure for maintaining revenue growth and market share (Kim, 2010).
In the precedent, it may have been harder to establish an Apple dealer in dissimilarity to a PC dealer. Lately, Apple has adopted Dell Computers’ method of using the Internet to trade their product. This may be considered advantageous since it reaches an extremely wider market as well as reducing on inventory costs. An additional tactic Apple has used to get to a new market is by submitting some of their goods to locally recognized retailers. This process exposes people who were not recognizable with Apple before to seize a “hands-on” look. In addition, Apple is analyzing the possibility of opening new more outlets. The quick progression in expertise is a current and burly tendency in the international marketplace therefore, generating fresh opportunities for Apple (Whitney, 2010).