Case Summary
The presented case study indicates that Apple Incorporation is currently operating in a very competitive market environment. New players such as Samsung Group, HTC, Nokia, and Tecno Mobile are affecting the firm’s performance. These competitors have innovated new products that deliver quality services to many global consumers (“Samsung Group” par. 4). The company’s marketing strategy has been ineffective. The company focuses on high-end markets characterized by rich customers.
Consequently, Apple has ignored the presence of many emerging markets in different parts of the globe. Innovation has continued to affect the performance of this giant corporation. Disruptive technologies are making it possible for many companies to command a lead in the global smartphone market segment. This development has made it impossible for Apple Incorporation to continue attracting more customers.
Apple has been using its infamous premium pricing strategy (Johnson et al. 12). This pricing strategy has made it impossible for lower-class consumers to purchase the company’s products. The case study explains why Apple must undertake new measures in an attempt to remain competitive. Failure to embrace the most desirable business initiatives will eventually affect the firm’s competitive edge and profitability. The solutions presented below will make it easier for Apple to achieve its business potentials.
Solutions for Apple Incorporation
Learn From Different Competitors
Apple always commits itself towards delivering value to more customers in the targeted regions (“Apple Incorporation” par. 2). The company uses “its resources to bring the best computing experience to different computer users, consumers, educators, and students in different corners of the globe” (“Apple Incorporation” par. 3). The company has also been a leading player in the consumer electronics industry.
It produces superior gadgets that support the needs of more users (“Apple Incorporation” par. 5). However, the company’s immediate competitors are affecting its performance and profitability. Studies have indicated that the company might be unable to command a lead in the industry. That being the case, Apple Incorporation should begin by learning numerous lessons from its immediate competitors.
Samsung Group produces innovative devices and apps that continue to empower more customers. The company’s research and development (R&D) department focuses on the best practices that can deliver positive results. The firm has come up with new “handheld devices using android” (“Samsung Group” par. 5). Apple has been focusing on its iPhone series. The iPhone might be one of the best smartphones in the market.
However, many consumers continue to purchase different substitutes in the market. This development has made it impossible for Apple to continue making huge profits. Apple Incorporation should, therefore, consider the best strategies to increase its superior brands. Such products should be produced and innovated in such a way that the address the needs of different consumers.
Google Incorporation is “a leading competitor in the internet offerings and software segment” (Huimin and Hernandez 392). The company uses the power of innovation to attract more customers. Many people in every corner of the globe are familiar with Google’s superior brands. Apple should use similar approaches to ensure its apps and products are used by more people. Such lessons will make the firm more competitive, profitable, and successful. These lessons will make sure Apple is on the right path towards achieving its business potentials.
Marketing Mix: Promotion and Place
A powerful marketing mix makes it possible for a manufacturer to deliver its products to the greatest number of customers. Although the marketing strategy embraced by Apple Incorporation has delivered positive results in the past, new measures can be implemented to increase the level of sales. The first aspect of the marketing mix to consider is promotion. Apple has always targeted a specific segment of the global market.
This is the case because “Apple’s products are marketed to the higher and middle-classes” (Huimin and Hernandez 390). Consequently, the company uses unique marketing and promotional practices that can inform rich people about these products. By so doing, Apple has been ignoring the needs of the lower-class. Members of this class are known to support the performance of many companies. Apple should, therefore, design new products and market them to members of the lower-class.
The other aspect of marketing that should be taken seriously is placed (Huimin and Hernandez 392). Apple targets specific regions characterized by rich individuals. This fact explains why the company does not market its products in different countries in Asia and Africa. That being the case, Apple Incorporation can expand its distribution network. The approach will inform more customers about Apple’s products. Numerous researches should be undertaken to identify new markets that have the potential to support the company’s marketing goals.
The firm can also collaborate with different suppliers and retailers in these new countries. This kind of collaboration will ensure the company’s products are marketed to the largest number of consumers. For instance, Apple can collaborate with different chain stores and hypermarkets in the developing world. Such stores have been transforming the nature of shopping in the developing world (“Samsung Group” par. 8). Competent marketers should also be hired to improve the marketing strategies undertaken by this corporation.
Pricing Strategy
Many analysts argue that most of the products bearing the Apple logo are usually overpriced (Huimin and Hernandez 392). Apple Incorporation has been using a powerful marketing strategy to increase sales and improve the level of profitability.
However, the provided case study indicates that Apple’s premium pricing strategy continues to prevent the average consumer from purchasing different products. Some members of the middle-class might not purchase the company’s devices. Some of these potential consumers believe strongly that the products are superior. However, the agreeable fact is that such products tend to be unaffordable. The lower-class has been forced to purchase various substitute products marketed by companies such as Samsung Group. Additionally, Samsung uses friendly-prices to market its products to more customers.
Apple Incorporation should, therefore, reconsider its premium pricing strategy. This goal can be achieved by using reduced prices for its handheld devices. The company’s R&D department should consider the best innovations that have the potential to improve the production process. The company will be able to cut production costs. The “price reduction strategy will eventually make Apple’s products cheaper and affordable” (Huimin and Hernandez 393).
This strategy should also be combined with the best distribution networks. Such networks will ensure the products are available to more customers in both the developed and the developing markets. The approach will make Apple Incorporation a leading player in different market segments.
Focus on the Future
A company that does not have a proper plan for the future will be unable to survive in the global market environment. Apple is known to innovate and design superior devices that have the potential to address the needs of many consumers around the globe (“Apple Incorporation” par. 3). However, the company develops new products and markets them for a long period. The company uses this approach to have more cash-cows (“Apple Incorporation” par. 8).
At the same time, companies such as HTC and Samsung Group engage in continuous improvements to come up with better products. The ultimate goal is to ensure every newly-produced product is superior and effective than its immediate predecessor (Huimin and Hernandez 392). The strategy attracts more customers while at the same time increasing profitability.
The managers at Apple Incorporation should understand that the global market environment is changing every day (Dudovskiy par. 2). This change is catalyzed by various global forces such as globalization and disruptive technologies. Apple should, therefore, consider these changes and be prepared for the future. The company’s R&D department should always consider innovations and products that have the potential to add value to more consumers. The managers should also consider the best organizational practices that can make the company sustainable.
The unpredictability of the global economy will ensure every company focuses on the most desirable competitive advantages and business practices. The company should undertake positive practices that can result in competitiveness. New resources should also be identified to deal with uncertainties. Such uncertainties can disrupt the company’s future performance. This fact explains why “the future should be taken seriously than ever before” (Elmer-DeWitt 2). This is the case because the level of competition and uncertainty will increase significantly in the coming days.
Monitor Disruptive Technologies
The role of disruption in different industries is something that should never be underestimated. Apple has always produced superior devices characterized by cutting-edge applications and software systems. Despite being a leader in innovation, small and start-up companies continue to disrupt Apple’s performance. Disruptive technologies continue to dictate the performance of different companies (Elmer-DeWitt 1).
These small players have access to different technological platforms. Such resources are making it easier for these players to produce superior products that can address the changing needs of more customers. The use of disruptive technologies continues to support the business models of many small companies. As a result, giant corporations have been forced to reconsider their business strategies in an attempt to remain competitive.
Apple Incorporation should accept the fact that “small start-ups that have the potential to affect its profitability and competitiveness in the consumer electronics industry” (Elmer-DeWitt 2). The firm should also understand that more customers will be attracted by these newcomers. The needs of the underserved consumer will also dictate the future of this industry. Disruptive technologies have made it easier for smaller corporations to address such needs.
The current wave of technological change is making it possible for small companies to compete directly with firms such as Nokia, Apple, and Samsung (Elmer-DeWitt 1). This situation should, therefore, encourage Apple to embrace the power of such disruptive technologies. By so doing, the company will be able to produce diverse products that have the potential to fulfill the emerging needs of more customers around the globe. Technological disruption is “a major force that has the potential to break or make a giant company” (Elmer-DeWitt 2). Apple should, therefore, embrace these practices to remain significant and competitive in the global electronics industry.
Social Media Networks
Social media networks are revolutionizing how many companies are doing business (Dudovskiy par. 6). For instance, social media platforms such as Facebook, MySpace, Twitter, and Instagram have been appreciated by many theorists as powerful marketing tools (Dudovskiy par. 9). As well, such platforms have been used to support the best organizational cultures in different workplaces. They have also been observed to improve the performance of many workers. Apple Incorporation should consider the benefits of these social networks. For example, Apple stands a chance to attract more potential consumers in different parts of the globe.
Social networks bring together more people from every corner of the universe (Huimin and Hernandez 393). Many people belonging to the same age-set have formed interactive groups through such media platforms. Apple can, therefore, use Facebook and Twitter to inform more people about its superior products. Such networks can also be used to collect meaningful information that can be used to improve the superiority of its products. The information collected from different consumers will be used to make the most appropriate improvements. Such measures will ensure the company’s products are admired and purchased by the largest number of consumers around the globe.
Emphasis on Corporate Social Responsibility (CSR)
Apple has been criticized for not engaging in public giving or philanthropic activities. This has been the case even though the firm has been promoting various CSR initiatives. For instance, Apple Inc. has been empowering and educating its workers for the last decade. It also embraces the best codes of conduct to support the needs of different stakeholders such as workers and employees (Dudovskiy par. 3).
Apple’s Global Volunteer Program makes it easier for more workers to support the needs of many local communities. However, Apple lacks powerful policies that can promote gender equality or support the needs of minority groups. Statistics have also indicated that Apple “emitted over 34 million metric tons of disastrous greenhouse gases in 2014” (Dudovskiy par. 7).
These issues explain why Apple should improve its CSR image. This goal can be Apple can achieve this goal by minimizing its carbon dioxide emissions. It can also support the needs of many minority groups. The issue of gender equality should also be taken seriously at the firm than ever before (Dudovskiy par. 9). The company should also promote sustainable supply chain networks and marketing processes. Such sustainable measures will make it easier for Apple Incorporation to attract more partners and eventually realize its business potentials.
Conclusion
Apple Incorporation produces superior products, software applications, and handheld devices that have the potential to support the needs of many consumers (“Apple Incorporation” par. 2). However, Apple’s business model is no longer sustainable due to the changes encountered in the consumer electronics industry. Companies such as Samsung are expected to command a lead in this industry. Apple should consider the above strategies to remain competitive, attract more customers, and become profitable (Johnson et al. 37).
The firm should also be aware of the major disruptive technologies reshaping the future of the industry. The best sustainability measures should also be put in place to support the company’s business model.
Works Cited
Apple Incorporation. 2016. Web.
Dudovskiy, John. Apple Corporate Social Responsibility (CSR). 2016. Web.
Elmer-DeWitt, Philip. “Why Apple, Tesla, and Uber Are Not Disruptive”. Fortune 1.1 (2015): 1-2. Web.
Huimin, Ma and Jose Hernandez. “Price Skimming on a Successful Marketing Strategy: Study of Ipad Launching as Apple’s Innovative Product”. Innovation and Management 1.1 (2014): 389-393. Web.
Johnson, Katherine, Yang Li, Hang Phan, Jason Singer and Haong Trinh. “The Innovative Success that is Apple Incorporation.” Marshall Digital Scholar 1.1 (2012): 1-43. Web.
Samsung Group. 2016. Web.