Apple Inc. is a technology business founded in Silicon Valley, California, by Steve Jobs and Steve Wozniak. The Corporation creates and sells cutting-edge electronic gear, software, accessories, and services. It offers a variety of PCs, iOS devices, operating systems, music programs, and app shops. Apple Inc.'s objective is to provide Macs that are the best personal computers in the world, along with creative and professional software such as OSX, iLife, and iWork. A strategy is the intentional courses of action that a company intends to take. The company characterized its purpose as providing the best user experience possible by utilizing revolutionary hardware, software apps, and accessories. Its products are increasingly vary from the competitors. For instance, its gadgets ranging from the Macs, iPad, Apple Tablets and iPhone offer graphics with superior performance.Apple Inc. moved to Asia motivated by the cheap costs of labor(Friedli, Mundt, & Thomas, 2014). Similarly, the potential of establishing a reliable and strong supply chain drove the location decision to Greater China.The position of Apple Inc.'s products and services owes to the heavy investment in marketing campaigns. Since its offerings are unique in the market, it employs a differentiation approach in its advertising efforts.
Analysis of Apple International Strategy
Company Description
Apple Inc. is a company started by Steve Jobs and Steve Wozniak in the Silicon Valley, in the United States of America. The company base is in Cupertino in California (O'Grady, 2009). It began as a personal computer manufacturer but extended its breadth to other electronics including smartphones.
Products and services
The Corporation designs and offers innovative electronic hardware, software applications, accessories, and services. It has a range of computers, iOs gadgets, operating systems, music programs, and app-stores. The hardware includes the Apple personal computers, iPhone smartphones, iPad tablets and the Mac PC. Other gadgets include the iPod media player, Apple TV, and Smartwatch. It also offers software products including operating systems for consumers in varieties of iOS and MacOS. Further applications offered are the iTunes, browsers and creativity suits. The service package includes the iCloud, online Apple Music and iTunes stores as well as the app store for MacOS and iOS (Zylla-Woellner, 2013).
Mission and values
Vision statement. The enshrined course of the firm on its website states, 'Apple Inc. is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world. It will achieve this through its innovative hardware, software and internet offerings.
Mission statement. Apple Inc.'s mission is to design Macs, being the best personal computers globally together with creative and professional software, OSX, iLife, and iWork. The company leads the digital music revolution with iPods and iTunes music stores. It offers revolutionary mobile phones through its iPhone and App Stores. It is, therefore, redefining the future of mobile media and computing devices with its iPad (O'Grady, 2009).
Apple Inc. Values. The company's core philosophy enshrines aspects of accessibility, education, environment, privacy, inclusion and diversity. Finally, supplier responsibility is among the highly treasured norms by the corporation. The following statements echo the fundamental beliefs guiding the strategy of the smartphone giant:
Apple Inc. is on the earth to make great products,
Simple things are essential for success in the industry,
Ownership and control of primary technologies is the seed of the great products,
Specialize in markets where we make a great contribution,
We focus on projects that are truly important and meaningful to the corporation,
Collaboration and cross-pollination of groups allows innovation surpassing others and,
Apple Inc. fraternity does not settle for anything besides excellence in each group in the company. Self-honesty is valued in admitting a wrong and gaining courage to change(Zylla-Woellner, 2013).
Headquarters and Center of Operation
The US-based company's headquarters is in Cupertino, California. However, it has operations across the major developed economies of the world. It operates outsourced manufacturing in Asia and other countries overseas. Besides its home market, Apple Inc. runs most of its marketing operations in the Western Europe and China. However, it has prospective segments in the emerging economies of India, Brazil and Middle East.
Size
Apple Inc. is a multinational company with operations in each continent. It runs through Americas, Japan, Greater China, Europe and the Pacific Asia. It has employed more than 116,000 employees across the world. Apple Inc. is a highly lucrative corporation with a market capitalization of $740 billion.
Industry
The company operates in the broad electronics, computing and media sectors through integrated products and services. Its initial industry was designing and selling personal computers. However, it diversified with innovations into the telecommunications sector dealing with smartphones, corporate and consumer software and smart electronics industries.
Competitive Landscape
In the smartphone industry, the rivalry is high with a segmented pattern pitting Apple Inc. at the high end. The competitive platform is fullof mass, feature and low priced phones. However, the company deals in the premium category where it leads competitors like Samsung, HTC, and Huawei among others.
The firm also operates in the telecommunication, software and services industries. It also competes with Google Inc., Microsoft Inc. and Nokia in digital mapping field. Amazon and Google Plus are also other rivals in the online retailing business. The sector is growing with fewer players since it is dependent on internet connectivity that needs massive inputs.
Strategy
The deliberate courses of action that a business intends to do is a strategy (Daniels, Radebaugh, & Sullivan, 2014). It is the plan that is consciously and purposefully designed to apply in reaching the intended goals. Similarly, the term referred to ploy involving tactics and spontaneous measures to combat a rival or opponent (Jahns, 2008). Mintzberg conceptualized it as a pattern of intended strategies a business employs to meet its goals.
Apple Inc.'s strategy is the set of plans and goals it adopts in design and selling of its products as well as its emergent reactions in the market. The company defined its intent as using the innovative hardware, software applications, and accessories to offer the best user experience. It draws its ploy from its abilities to innovate and manufacture both the operating systems and gadgets. The corporation is unique in integrating the basic and augmented products to provide solutions to customers. For instance, it enables ease of use, seamless incorporation and creative designs as the core competencies.
The backbone of the company's innovations is the heavy investment in research and development. On the other hand, its brand superiority drive is by high involvement in marketing and advertising campaigns. Therefore, expansion of the discovery platform based on the market trends and needs has kept the company in industry leadership. For instance, the creations supporting Apple Inc.'s portfolio arise from third-party software and hardware developers. The community is supported by the corporation to further its innovative ambitions.
An analysis of the strategy focuses on different levels of the organization. In this manner, four stages are evident in the company's planning and execution of the mission.Thus, broad goals are set at the corporate position while specific details determination is at the business level.
Apple's Collectivist Strategy
The collectivist strategy defines the trade-off between control of critical resources and costs. It defines the boundaries of the company in its inter-organizational structures. Since Apple Inc. operates with many outsourcing manufacturers, it has to integrate the goals of the partners. The firm uses the platform to forge a sustainable competitive advantage in the telecommunication and computing industries. For instance, it creates upstream linkages and close ties with key business networks of suppliers, distributors and service providers. Apple Inc. uses the collectivist strategies to navigate the environmental conditions. Theoperations of outsourcing areeffective in navigating costs and logistical issuesalong the US to Asia route.The multiple partnerships cover uncertainties of political pressure with the local companies supplying parts and equipment to its foreign manufacturing bases.
Apple's Corporate Strategy at the Executive Level
At the executive level, Apple Inc. has a deliberate course of action enshrining its core values and objectives. First, the company pursues a dominant business that generates a majority of its profits. For instance, it majored on Macs and iPad for a season to maximize the revenues from the innovation before diversifying to the next product. Similarly, the company optimized its investment in designing the iPods and iTunes from which it generated premium revenues. The latest cash cow generating its bottom line figures is the iPhone (Gurman & Lee, 2011). It exploits its innovative power on the smartphone to ensure it dominates regarding returns. Therefore, the company has a dominant business from which it diversifies with supporting products. The computing division was the backbone that made its core offerings. On the other hand, the chip and software products support the growth of the main item. The firm also employs related constrained diversification in the telecommunication industry (Kilic, 2013). For instance, the Apple Music store, the i-Watch and mapping innovations improve the experience of customers using the iOS devices.
Business Level Strategy
The corporation utilizes a differentiation strategy at the business unit level. The advantage is derived from making clients dependent on computing and communication devices. By creating ease of service through internet connected gadgets, the firm makes clients yearn for more (Moorman, 2012). The primary advantage lies in the creativity and integration of its hardware and software applications. Also, production capabilities enhance is by the effective outsourcing of supply chains and channels of retail distribution.
The second strength is the research and development efforts that focus on designing quality innovations. For instance, it is enshrined in the core values that the firm only cooperates in areas it has increased leverage. The company's products vary from those of the competitors. For instance, its gadgets ranging from the Macs, iPad, Apple Tablets and iPhone offer graphics with superior performance. The feature places the brand at a unique position in the industry. Finally, the design is another element that distinguishes the offers from the organization (Meyer, 2017). Given the seamless integration of the products and the consistency in performance, its overall image is superior. A significant investment in the marketing activities has created strong brands with high loyalty. The exclusive use of secretive processes makes the features of Apple Inc.'s products impossible to imitate by rivals. Possession of the proprietary technological infrastructure denies the imitators the ability to innovate and offer superior quality designs.
Global and Cooperative Strategy
The company utilizes a global strategy where it produces and markets its products and services worldwide (Dudovskiy, 2017). However, it has a centralized control mechanism that secures its innovations, coordinate pricing, and marketing activities. Apple Inc has divided its international markets into segments for ease of accessibility. It utilizes joint ventures and strategic alliances as the entry modes. The strategy has paid to enhance brand recognition and circumvents environmental challenges. It has allowed the company to source the best parts and access cheap labor from industrial regions of the world, particularly in Asia. The diagonal and vertical alliances of Apple Inc. with suppliers have revolutionized global sourcing in the contemporary world. For instance, it ventures into innovation at a component level and contracts with a partner to further the project. Thus, it furthers technological growth vertically among its vendors by investing in their creations. Since it partners with value chain members to design inputs, Apple Inc. achieves high-quality products combining the leading technology from different industries. For instance, the company has utilized Samsung Electronics among others for sourcing chip-making inputs. The screen manufacturers and as batteries have multiple partners from across Asia, the USA to Europe.
Apple Inc. employs outsourced manufacturers to supply its equipment, parts and critical inputs. For instance, an alliance with companies like HP, Nokia, and Nike were instrumental in making breakthroughs in the markets as well as innovations. The corporation values partnerships with leading technology firms to lower supplier bargaining and overcome its internal limitations. Therefore, it focuses on fast-tracking innovations while the vendor's manufacture, supply, and others assemble the components.
Global Manufacturing and Supply Chain Management
Initially, Apple Inc. designed and produced its offerings by itself in the US market. However, trends emerged among electronics companies were no longer proud of 'Made in USA' labels (Duhigg & Bradsher, 2012). Consequently, the firms sought locations in the world that would offer cost savings and control oversupply of raw materials. Since the products and components became standardized, a move to overseas manufacturing was the solution to managing the production expenditures. Apple Inc. moved to Asia motivated by the cheap costs of labor (Rose & Reeves, 2017). Similarly, the potential of establishing a reliable and strong supply chain drove the location decision to Greater China. For instance, most of the components used in theassembly of Apple Inc.'s designs are rare earth materials. The inputs are foundonly in the regions of Mongolia. Currently, the firm's vendor network centers in the Chinese industrial complex. However, it is spreading its hubs to other emerging markets like India (Purnell & Wakabayashi, 2016). Firstly, the screen of the iPhone is glass unlike the ordinary plastic for other phones. The company relied on Foxconn to change the feature (Lee & Rogers, 2016). Facilities of the manufacturer based in Taiwan, Shenzhen, and Zhengzhou implemented the speedy adjustment.
The basic advantage of the location of the organization's assembly plants in China is a two-fold advantage of labor efficiency. Firstly, the costs of the workforce in the region are 16 times cheaper than the US human resource. For instance, the nation is endowedhighly with workers due to a large population. Secondly, the laws in the country are not restrictive. An agency can organize the workforce within a very short time (Shugar, 2016). A required size of the labor force can be assembled easily compared to the United States. During the launch of the iPhone, the factor proved crucial in meeting timelines. For instance, from estimates, hiring 8700 industrial engineers would have cost the firm nine months to oversee the assembly of the smartphone. The duration would have delayed the planned launch of the innovation. However, the same number of technocrats was hired within 15 days. Given the above advantages of outsourcing, the corporation relies on the regional giants like Pegatron and Foxconn to finalize manufacturing. Although Apple Inc controls the design, the iPhone, iPad and their accessories are fully assembled by the partners.
The strategy has been essential in furthering the company's success as well as creating opportunities for growth of rivals. In the first phase, it has allowed it to focus on designing innovations and lowered its cost structure. Furthermore, outsourcing has allowed Apple Inc to overcome its limitations and gain advantages from other leading technology firms. Finally, the approach has allowed the firm to navigate through political and logistical difficulties. For instance, reliance on Chinese suppliers facilitated its foothold in China and its wide market.
The second phase of the strategy has posed challenges. Firstly, reliance on outsourcing has farmed competition. For instance, Samsung Electronic served as the major supplier of processors. However, it imitated the features of the iPhone and later on predated on the company's existing market share (Adam, 2016). Secondly, the organizations in the Apple Inc's supply chain are operating in conditions that do not meet legal requirements such as labor law violation. For instance, only 73% comply with the corporation's code of conduct of vendors (Mozur, 2015). Closer working relations with the partners' manufacturing plants can increase compliance with working standards.
Apple Inc.'s marketing strategy
The position of Apple Inc.'s products and services owes to the heavy investment in marketing campaigns. Since its offerings are unique in the market, it employs a differentiation approach in its advertising efforts. For instance, the company promotes its gadgets and services based on their creative designs that differentiate it from the rivals (Drewniany, 2007).
Segmentation
The company's target market is therefore composed of youths, educators, professionals and organizations. Personal computers and i-Phones have superior graphics for games and educational features for young people. Entertainment and media products like the iTunes, Apple Music, and the App Store appeal more to the younger digital generation (Hovivian, 2014). Furthermore, the schooling college and university category utilize it for handling assignments, making presentations and creative research purposes. Similarly, educators like professors and tutors use in for preparing lectures, demonstrating and organizing class works.Additionally, the gadgets like the iMacs, iPad, and iPhoneare used by professionals in planning office work as well as graphic presentations. The corporate clients use a wide range of the firm's products. The offers for the range include computers, smartphones, software applications, content, and mapping services.
Target Market
The strategy aims at targeting a single customer segment to serve the superior quality products at a premium profit (Mickle, 2017). Middle and upper-class income customers are the focus of the organization's marketing efforts. It fits the aims and goals of Apple Inc. because they are willing to pay higher prices for a great user experience. Therefore, the corporation's product portfolio targets the upper-end buyers. It designs personal computers and communication devices to students, creative professionals, and educators around the world.
Positioning
Apple Inc.'s personal computers, smartphones, media devices, and software are positioned at the high end in the premium markets. The variables alongside which the company positions its offers are differentiation, designs and high pricing (Dudovskiy, 2017).
4 Ps of Marketing
Firstly, the product strategy focuses on designing high-quality gadgets that offer a superior customer experience (Mickle, 2017). A broad range of computing, communication devices, and content are unique with superior designs. The innovations are backed by heavy research and development programs.
Apple Inc. has set its commodities and services at premium prices. The company's goods attract the highest cost in the high-end markets. A differentiated product is targeted to upper and middle-class income earners capable of parting with slightly higher amounts for designs and experience. The company maintains the levels across the world with effective control mechanisms (Mickle, 2017).
The strongest competitive advantage of Apple Inc. is the power of its advertising and promotional campaigns. Its ads utilize the value of creativity that promotes the use of the unique features of Apple Inc.'s gadgets. For instance, it designs messages that appeal to the target audiences like 'Think Different,' 'People of 2000s' as well as 'Super Bowl.' Such catchy taglines with superior graphics are effective in influencing the market (Homby, 2013). Furthermore, most of its appeals focus on the aesthetics and lifestyles instead of product features. Therefore, the ads have been successful for eliciting what customers want and going forth to fulfill the need. The company invests heavily in advertising to build strong brands that are differentiated. It allows the firm to earn higher profits from loyal customers.
Apple Inc. has enhanced a worldwide distribution system that ensures that its products are availed to its key markets. The corporation runs a retail system with online and street stores in the US and overseas. Its content and accessories can be downloaded easily with client support services. Managing the channel is significant as price, advertising and pricing contribute to the exclusive value of Apple Inc.'s offerings (Hovivian, 2014).
Conclusion
Apple Inc. company base is in Cupertino, California in the United States. The company emerged as the greatest successful products of innovation in the telecommunication industry. It leads in the markets with superior products like the iMacs, iPad, iTunes, operating systems and the iPhone. The corporation has employed the corporate strategy of establishing dominant products that earn the firm lucrative profits. Furthermore, it invests heavily in research and innovation to create superior design gadgets. Therefore, it has outsourced manufacturing to focus on creativity and developing creative solutions. Consequently, it has produced computing machines, telecommunication devices and content that is unique from its rivals. The firm has taken advantage of the rare quality and performance to position its brands on a differentiation basis. A heavy historical investment in marketing and advertising have enhanced the branding efforts. The strategies have yielded a loyal following among the upscale customers across the world from all demographics. It has allowed the corporation to charge premium prices keeping it in the high-end smartphone and computing industry. It related diversifications benefits from brand associations to fetch higher revenues over the competitors.
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