Apple Inc.’s Analysis and Implications for Practice

SWOT analysis is used to determine the main strengths, weaknesses, opportunities, and threats of a studied company. It is conducted to understand better the potential and competitive power that should help to form strategies for the future. All studied factors are both internal and external, meaning that a company is influenced by its current policies and practices, as well as the political and economic situation. This paper reviews Apple Inc, one of the most famous technology companies in the world, and provides a SWOT analysis for it. Although the company has strong positions in the local and global market, its competitors are growing rapidly and pose a real threat to the corporation.

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The SWOT Analysis

Below is a short table featuring main strengths, weaknesses, opportunities, and threats for Apple Inc followed by a more detailed description of each factor.

Strengths Weaknesses
  • Advertising
  • Reputation
  • Financial Performance
  • Supply chain structure
  • Weak cross-platform opportunities
  • Low presence in Asian market
  • Focus on single product sales
  • No innovation
Opportunities Threats
  • Spread of applications
  • Gadgets for business and finance
  • Growth of population
  • Integration with other services
  • Tough competition
  • New immigration policies
  • Market loss
  • Economic recession

Strengths

Strengths are the internal factors of Apple Inc that influence the success of its business. In general, they are marked by the smart marketing politics and the established sales process that regularly brings high revenues to the corporation. Advertising is one of the most important features in this list. The company has created a scheme that allows it to spend less on promoting its products. Only a small portion of its budget is spent on advertising in traditional media.

Most information is translated through digital platforms. There is also an annual conference that informs potential customers about new products. Since Apple Inc was one of the first companies to introduce the revolutionary new type of smartphone, it quickly became recognizable. Nowadays, it has a reputation of a corporation that manufactures high-quality devices with a recognizable design. The company’s financial reports show that its current strategy is successful, demonstrating evidence of reaching a record quarterly revenue in 2017, which made up $78,4 billion (Apple Inc, 2017, para. 1).

This financial success is explained by a relatively high price of its products combined with the mass popularity. Finally, the supply chain structure of Apple Inc allows it to control almost all the processes and be independent of competitors. The corporation controls both hardware and software business, as well as the service sector and the retail process.

Weaknesses

Despite all the popularity and originality of the brand, Apple Inc has a range of weaknesses that are based mainly on its low flexibility. Firstly, its products are often not designed to fit other platforms developed by competitors. Some applications or programs, like MS Office that is widely used for education and business, have to be substituted by analogs. Besides, a range of the brand’s own products does not match with each other.

It mainly concerns hardware, as each type of device has its own charger. While Apple Inc has a wide presence in the home market, it downsizes the importance of developing in the Asian region. For instance, India is known to have one of the world’s largest demands for smartphones (Phelan, 2017), yet Apple Inc does not have official stores there. Another weakness of the corporation is that it has put its main focus on producing and distributing only a single product, which is iPhone, setting all other devices aside (Apple Inc, 2016, p. 23).

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While Mac computers remain to be one of the most popular options, customers prefer to buy other types of non-marketed devices from competitors. Finally, there were no innovative steps in the recent years. Most of the new features were either not very different from previous versions or poorly designed. For instance, the latest initiative with wireless earphones was not received well.

Opportunities

Apple Inc has a great opportunity to benefit from several factors that mostly concern business and entertainment fields. For instance, the application market is growing rapidly, and people nowadays prefer to use various messengers instead of calling or texting their contacts, even regarding work inquiries. Services like Apple Pay can be used for business as well, which is fast and convenient. In general, most progressive companies nowadays will need Apple devices to make their processes fast and efficient.

Ordinary people are also getting used to applications that help them track their health, finances, daily tasks, etc. Besides, the world’s population is growing, which means there is an increasing opportunity to sell more devices. Finally, most companies that have Internet platforms realize the popularity of Apple devices among their users, so they design their web pages to be convenient specifically for this group of customers. Many businesses now have a mobile version for their e-commerce platforms, as well as news publishers and blog authors.

Threats

Main threats for Apple Inc are identified within an unstable political and economic situation in the world. Competitors in Asia are developing similar devices that are much cheaper, becoming more popular in the world. While they can afford it due to the low costs of production, Apple Inc suffers from the new governmental initiative to make the immigration process in the U.S. more complicated (Sanchez, 2017, para. 1).

It will soon affect the company dramatically, as it will no longer be able to hire as many foreign workers while paying them lower wages. Apart from that, the world is shaken by a range of open conflicts, which closes potential markets. Finally, many countries currently face economic recession, which does not allow thousands of people to afford the brand’s products anymore. All these facts reduce the total sales of the company and may cause its failure in the future.

Implications for Practice

SWOT analysis is very helpful for solving any existing problems within a company. While there are no opportunities for Apple Inc to change the global economic situation, it can redesign its internal processes to comply with the current difficulties. For instance, the analysis determines that innovations are required for the company to stay competitive. Besides, it has to make more effort to win the Asian market. Keeping things as they are nowadays may lead to losing positions even in the home market, while cheaper versions appear rapidly.

The management team should focus more on being flexible. It is understandable that they wish to receive as much revenue as possible. However, the field of technology is developing fast, and devices become cheaper each year. There are already many devices made in Asia that can successfully compete with Apple products. If the brand fails to include people with lower income to its target audience, it risks finding demand only within small circles of dedicated users. Although the company’s financial reports keep setting records, they rarely include the inflation rate and the fact that their products are becoming only a status thing instead of providing unique technological solutions.

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References

Apple Inc. (2016). Form 10-K for the fiscal year ended September 26, 2015. Web.

Apple Inc. (2017). Apple reports record first quarter results. Web.

Phelan, D. (2013). The Indian mobile phone market: An alien world where seven-inch tablets are big sellers. The Independent. Web.

Sanchez, R. (2017). What to know about Trump’s visa and refugee restrictions. CNN Politics. Web.

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