Apple Inc.'s business strategy and historical development

Apple Company

Company History

Apple Inc. was established in 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne. The company started by selling the Apple I personal computer kit, computers that were hand-built by Wozniak at the time (Wikipedia, 2009). After a few years since its establishment, Apple had employed a complete staff of computer designers and was in charge of a production line.

The company was facing tough competition from IBM and Microsoft. Apple's respect to its competitors was revealed by the attention the company paid to its marketing campaign, especially regarding its commercials. For example, Apple's ads in 1984 were directed by Ridley Scott.

Ever since its establishment, Apple has been in full development process. The company has managed to expand its activity even during times when business was not so flourishing for Apple. As a consequence, the first official Apple Retail Stores in Virginia and California were opened in 2001.

Consequently, Apple started selling the iPod portable digital audio player. The product was sold in over 100 million units within six years, proving how successful Apple's strategy can be even without providing a very detailed range of products.

The company is well recognized partly for its logo. Initially, the logo portrayed Isaac Newton under the famous apple tree. Since 1976, users have been introduced to the famous Apple logo that is re-stylized from time to time.

Creating and refining innovations

However, Apple is aware of the fact that these factors are not sufficient for sustaining a profitable position for a company of Apple's size. As a consequence, Apple aims to increase its loyal customer base by expanding its distribution network. Apple's strategy of attracting new customers and keeping existing ones is based on the following sub-strategies:

High quality products

Post-sales support experience

The company's strategy is not based on a very diversified range of products. Instead, Apple is trying to attract and retain new customers by providing a high quality buying experience for the customer. But such a strategy cannot be based only on high quality products. The buying experience can be improved by knowledgeable salespersons "who can convey the value of the company's products and services greatly enhances its ability to attract and retain customers. The company sells many of its products and resells certain third party products in most of its major markets directly to consumers and businesses through its retail and online stores" (Apple, 2008).

Apple is very interested in the selling process. As a consequence, Apple has made significant investments in programs designed to improve reseller sales. One of these programs is the Apple Sales Consultant Program. This program consists in placing Apple employees and contractors at selected third-party reseller locations.

The reason behind this strategy consists in the fact that Apple's managers consider that one of the key factors that sustain a successful general strategy is represented by direct contact with targeted customers. This is a great way for Apple to prove the advantages of its products in comparison to the products of the company's competitors.

In order to increase the number of customers, Apple stores are very important. Regarding the company's stores, location is very important Apple stores can be found in high traffic locations, quality shopping malls, and urban shopping districts.

The company's product line is consisted of the following categories: hardware products (MacBook Pro, MacBook, MacBook Air, Mac Pro, iMac, Mac mini, Xserve), music products and services (iPod shuffle, iPod nano, iPod classic, iPod touch, iTunes 8, iPhone), peripheral products, displays (Apple TV), software products and computer technologies (operating system software - Mac OS X, application software - iLife, iPhoto, iMovie, iDVD, Garage Band, iWeb, iWork, Final Cut Studio, Logic Studio, File Maker Pro, Internet software and services - Safari, QuickTime, MobileMe).

As one may observe, Apple does not have a great number of products, but they suffice for satisfying each customer, no matter how diversified his needs and preferences are. This is one of the reasons for which Apple is continuously successful, and it manages to keep its customers and to attract new ones. Everyone finds what they need at Apple. The company's product range covers all of customers' necessities, whether one refers to entertainment or to work related needs.

Apple's customers belong to the consumer, SMB, education, enterprise, government, and creative markets. Each of these markets responds to different stimuli, a different message. Therefore, the company must adapt its strategy for each of these categories. However, each of these strategies must be in conformity with the company's general strategic direction.

As mentioned above, the company's success is also due to its continuous and significant investment in the research and development activity. Apple is aware of the fact that customers' needs and preferences are constantly changing, developing, and expanding. Therefore, the products they want to buy must also change, develop, and expand.

Also, the company is investing in opening new stores in several geographic areas. This is one of the most important parts of Apple's strategy. By increasing the number of stores and by expanding the geographical area, Apple manages to increase its number of customers.

Reference List

Apple Inc. (2009). Wikipedia, the free encyclopedia. Retrieved March 3, 2009 at http://en.wikipedia.org/wiki/Apple_Computer.

Annual Report (2008). Apple Inc. Retrieved March 3, 2009 at http://www.apple.com/investor/.