In doing this, Apple was able to successfully create even greater differentiation through an innovative approach to product positioning that captured new customers while retaining the trust of its large, profitable installed base. Apple has been able to precisely do this by holding into their old-line customers who are more like unpaid evangelists and the new generation of customers who are focused on the iPod and iPhone. Apple has been able to successfully use their insights into new product, supply chain process, and manufacturing innovations to create a highly defensible product and services strategy. The use of intelligence to create a synchronized and differentiated strategy is what differentiates market leaders, and this is seen from the case study in how well Apple has been able to do this with their suppliers and channels.
2. If Apple does have a competitive advantage, is it likely to be sustainable? (Why? What makes it sustainable?)
Apple has created the necessary underlying network of suppliers and attained a high level of supply chain expertise, systems and software development capability, and also created processes that can translate product designs to customer experiences. In short, the company has been able to surpass competitors who seek to imitate them by concentrating on making the entire ecosystem of development and customer...
The case study often cites the concept of the iTunes ecosystem being the most durable source of competitive advantage the company has. Apple has been able to create a sustainable competitive advantage by combining a unique value in the design of their iPods and iPhones, coupled with a unique and highly differentiated music delivery system that is platform agnostic, in addition to a licensing approach that is not easily imitated. Taken together all of these factors continue to create a sustainable competitive advantage for Apple. Add in their expertise in operating system development and the success of OS X as a platform for serving their strongest legacy customer bases while also being compatible with the Intel microprocessor, and it is apparent Apple partners and opens its architecture when it provides multiplicative effects to their growth. Apple then is the quintessential competitors per Porter's framework of generic strategies as was discussed in class. The emphasis on the customer experience is further a point of differentiation, made possible only through the alliance, partnerships and programs that in turn have created a value-generating ecosystem that makes differentiation possible. Apple then has created formidable competitive barriers not only at the supply chain, pricing, and product experience level as a result of using…
