Apple’s Winning Marketing Strategy (SWOT)

Apple’s Winning Marketing Strategy

Apple is one of the leading and most innovative electronic and software companies in the world today. The company name is behind great products like Macs, iPods, iPads, iPhones, and a plethora of software. Steve Wozniak and Steve Jobs established Apple in 1976; the company was later incorporated one year later in 1977. In 1997, Steve Jobs was able to successfully restore the corporation from the threat of bankruptcy. Jobs accomplished this task with simple but innovative philosophy behind each product they manufactured. Apple Inc. is currently worth over $150 billion, with valuable stocks being sold every day. Great leadership and superior technological advance is attributed to the success of Apple.

Strengths Apple has numerous attributes that have strengthened the company year after year. First, under the leadership of Steve Jobs, Apple was able to establish and reach new heights in their niche. According to Ferrell and Hartline, “Apple has excelled in both leadership and operations. One of the company’s most important resources is its employees, and the company has effectively recruited, trained, and compensated employees to create loyalty” (Pg. 327). Organizational structure and leadership can make or break any company, they are essential to the proper management of companies. Apple recognized this principle early on and capitalized on it as strength. In addition, the strength of this corporation also lies in research and cleverness in the development of their products. Apple is able to utilize the result of intricate research development to successfully create masterpieces that consumers desire and are prepared to purchase at high retail price. Consequently, Apple products are now known to headline trends in the industry and have established brand loyalty. In order to fulfill the needs of customers, Apple seeks out the best resources to manufacture devices; “Apple has created a highly efficient and effective supply chain with most of its production in China (Ferrell and Hartline, 2012). To further improve and better equip their supply chain workers, Apple invests in their employees by providing development courses and educational resources at no cost. “In addition, our suppliers trained more than 1.5 million workers on their rights, bringing the total number trained since 2007 to 3.8 million” (Apple.com, 2014). Weakness

Apple products carry a premium price tag, so the sale of their products is dependent upon our global economy and competition. “Apple Inc. on Tuesday suffered its worst single-day market performance in a year, as the company’s share price fell 8% following a one-two punch combination of disappointing iPhone sales and a weaker-thanexpected revenue forecast” (Crum, 2014). A noticeable decline in sales is due to competitors offering similar products like Apple, but at a more affordable price. For instance, the iPad is sold at approximately $500, but Google and Samsung retail other comparable devices for less than $250. Secondly, major weaknesses plaguing Apple are lawsuits filed against the corporation. In 2009, Nokia sued Apple for an undisclosed amount of money, stating that the company refused to compensate them for the authority to utilize Nokia’s technology. “Back in February, China-based company Proview Electronics sued Apple for $1.6 billion, claiming the company infringed its trademark for the word iPad” (Business Insider, 2012). This lawsuit ultimately set Apple back about $60 million, due to the fact that they were not permitted to use the word “iPad” in China. Lastly, another weakness is that Apple devices have exclusive apps that are incompatible with non-Apple devices and vice versa. Since the operating system of Apple differs from the system of Android, it renders the functionality of applications invalid. Mobile device users have to actively seek out comparable versions of various apps in the two operating systems in order to use their devices. Opportunities Apple created the iCloud in order to be more competitive with companies such as Amazon and Google. There are reports that this particular venture of launching a cloud

service has been an unsuccessful one for Apple. Therefore, this creates an opportunity for the corporation to create better opportunities for itself by strengthening this particular platform. “Apple’s ill-fated introduction of Apple Maps and stumbles with DotMac, MobileMe and now iCloud show they are persistent and committed to success in the Cloud. They know it’s a deal-breaker” (Tokerud, 2013). In addition, Apple’s recent problems in countries such as India and China presents as an opportunity for the innovative company to grow its business further. Currently in India, Apple’s market share is not as lucrative as it is in the United States. Apple has encountered roadblocks trying to establish stores in India due to the laws pertaining to the local markets. If the company overcomes this legal issue, their market shares will increase exponentially. In China, the government is determined to develop its own processors, which will in turn decrease the reliability of the country on Apple computer products. The dispute stemmed from warranty issues the country experienced with Apple; therefore, this placed a strain on Apple’s relationship with the Chinese government. Lastly, Apple should consider continuing the acquisition of numerous small companies to build a lasting future. “Apple had its biggest year ever for acquisitions in 2013, with a record 15 smaller companies joining the fold” (Heath, 2013). With opportunities such as these, Apple’s ability to deliver amazing products to loyal consumers is increased. Buying into these sophisticated start-up companies is an avenue for Apple to contribute to the economy while being steps ahead of competitors. Threats Since the early 1990’s, Apple has dominated in its market, but competition from other companies threatens this position. Apple’s largest competitor is Samsung, “the

company has been the only Apple competitor to crack the code of beating Apple on product design and innovation, and its sales reflect that victory” (Reisinger, 2013). Samsung is succeeding because the company caters to all customers, providing a variety of products regardless of budget. If Apple were to focus on the different classes of potential customers rather than a group of certain status, they will be able to eliminate this threat quickly. Tim Cook, the Apple CEO, is lacking the leadership qualities his predecessor, Steve Jobs possessed. The late CEO of Apple, Steve Jobs, knew how to captivate the world with his charismatic personality. Under Steve Jobs’ leadership, the company made an incredible turn around from the threats of bankruptcy to surpassing Google by becoming a global brand. No two leaders are the same, but Apple must bridge the gap between the successes Jobs created for the company through his leadership and the new CEO. The rapid changes being initiated by technology posses as a risk for Apple, as far as security is concerned. “New threats arise with emerging technologies like near field communications (NFC) being integrated into mobile platforms. Innovative uses of GPS services to connect our digital and physical lives present new opportunities for cybercriminals to compromise our security and privacy” (Sophos, 2014). Apple products are not immune to such threat, as malware developers have become more sophisticated in their approach to stealing from mobile device users. In conclusion, Apple has successfully made a name for itself in the world, and quite the impression on consumers. In order not to lose momentum during their rein as most valuable global brand, the company must focus on certain weakness, threats, and

opportunities. Reevaluating such problems is the solution they need to continue be an innovative company.

Reference: "Apple - Supplier Responsibility." Apple - Supplier Responsibility. N.p., n.d. Web. 8 Sept. 2014. .

Crum, Rex . "Apple gives worst performance in a year." - MarketWatch. N.p., 28 Jan. 2014. Web. 8 Sept. 2014. .

Ferrell, O. C., & Hartline, M. D. (2014). Marketing strategy: text and cases (6th ed.). Mason, OH: South-Western/Cengage Learning. Rogers, Abby. "Here Are 10 Lawsuits Against Apple You Should Know About." Business Insider. Business Insider, Inc, 19 Aug. 2012. Web. 8 Sept. 2014. . "Security Threat Report 2014." Sophos Security Made Simple. N.p., n.d. Web. 9 Sept. 2014. . Tokerud, Janet. "Apple Strengths and Weaknesses 2013." tokerudcom. N.p., 10 Aug. 2013. Web. 9 Sept. 2014. .