Apple Inc

(Part 2)

 

Technological Factors:

 

Fast technology changes with heavy competition mostly affect Apple, in order to further develop and innovate new ideas, Apple would need to spend money on research and development because of the rapid changes that occur in the electronic industry. Major competition involved recently for Apple is Samsung the new S4 which is available to consumers on the 27th April 2013, with amazing features that it currently holds Apple would need to up its game and further develop their product as Samsung is highly competitive in the market. It is announced that the iPhone 5S would be next in line however the features it includes are still not available to the local market, this will potentially be announced in June at a conference by Apple. Another advantage Apple currently holds is the use of its own brand operating

systems in its products however this results in heavy production costs. Also attractive and slick designs that the apple holds could be another major factor of its success, the new iPhone 5 is much slimmer and weighs less, this shows that Apple have used a sum amount of money on its R&D in order to develop such product and attract its customers.

 

Porter’s Five Forces:-

Porter’s five forces analysis is a framework for business strategy development put forth by Michael E. Porter, before developing Apples business level strategy Apple must understand what forces may or may not determine the profits. The model focuses on how five forces in an industry buyers, suppliers, new entrants, substitutes and rivalry impact each other and not how they impact Apple. Threats of substitutes

Inevitably high competition is visible in the industry, especially the Android market which has excelled throughout the years and is neck in neck with the iPhone. Moreover products from RIM (blackberry), Nokia and HTC are trying to tackle the market in order to stay at the top in the competition; however android and apple have maintained its position as the top 2, therefore the only threat that Apple faces is Android. Although Apple have maintained its iPhone market, they need to consider other products such as the computers, Microsoft invests daily on new innovative products, therefore the Apple MacBook may face rigorous competition, therefore making it a substitute of Apple computer products in hindsight making it a tough competition to survive in the market. Apple each year has released different operating system which is the OSX, the system ensures faster response and reliability with immense features. Therefore increasing Apples brand loyalty among its consumers as the software is unique in its own way. This feature further ensures Apple sticks with innovating products consequently allowing the public to look forward to more enhanced products in the near future. Portable music players from Apple also face high competition, as there are various varieties available in the market that offer similar products, companies such as Sony, are known for its portable music player, however Apples products have better storage then the Sony Mp3. Threat of Existing Rivals:

The threats have been relatively high for Apple in the current market especially since Android has made its way in to the market. Apple operates for various market segments, computers, portable music player and of course the famous iPhones. However there are big companies that compete in the market in which some of them are:

* Sony

* Dell

* Samsung

* HTC

* Blackberry

* Microsoft

These rivalries provide different and unique products in order to ensure its market share however some products tend to excel with its consumers such as Samsung in the mobile phone industry and then there is Dell within the computer market. Pricing strategies are used in order to ensure companies continue its products at same rate for a long term, Apple has understood how price has a huge impact in consumer buying power therefore they are developing cheaper iPhones for its next launch so individuals who have little income can afford it. This relatively ensures Apple is in a better market position and can further develop their research and development. Furthermore The Mirror has mentioned how “The iPhone 5 has overtaken the Samsung Galaxy S3 to become Britain’s favourite smartphone” (Mirror). This shows that even with the prices that the current iPhone is being sold at consumers are still willing to buy it, which indicates that because of Apples success on its research and development consumers are more than happy to pay for the new iPhone at immense price. However apples rivalries are currently spending a lot in its research and development of their products which can potentially be a threat to Apple. Threat of New Entrants:

 

Value chain analysis

 

References

Books
Lynch, R (2009). Strategic Management . 5th ed. Essex: Pearson Education

 

 

Apple