Apple's competitive strengths in computers, media players, and smartphones

Apple Case Study

Apple

Competitive strength assessment of Apple's computer business

A competitive assessment of Apple reveals that Apple has these factors everything ready devices, design and innovation, R&D oriented, and greater vertical and horizontal integration. Apple has made its devices be everything ready, which reduces the consumer's headache in sourcing for software or additional hardware to suit their individual purpose. Ensuring that the devices are ready for the consumer's use also offers the consumer the confidence to purchase and use the computers. Consumers are willing to pay premium prices provided they know they can get all they need in one device (Pavlou & El Sawy, 2010), and they will not have to search for additional hardware and devices. This differentiation has offered the company competitive advantage over its computer rivals. The design of the computers are attractive, and they are easy to use. Innovation has ensured that the company is able to offer its consumers products that are ahead of time, and they have undergone market research. The innovativeness of the company has allowed it to have computers that challenge the market trends, but are liked and appreciated by the consumers.

Apple is oriented towards research and development. This factor has enabled the company to improve continuously on its computers. R&D orientation has allowed the company to challenge the market and offer products that its competitors do not have. Apple has a greater vertical and horizontal integration, which enables the company to reduce its production costs and control production of its hardware and software. Integrating the development of its products ensures the company can effectively have components that work together and increase efficiency of the overall computer. This integration is vital to the company's competitiveness, since most if its rivals lack integration.

Is the company's competitive positions in the media players and smartphones are stronger or weaker than its position in computers?

In the personal computers market, Apple has a market share of 10% and is ranked third. In the media player market, the company holds 73%, while, in the mobile market, Apple controls 24% and is ranked second (Goasduff & Pettey, 2012). This does reveal that the media player and smartphone have a stronger market share than in the personal computer industry. Since 2007 when the company launched the first iPhone, the smartphone has attracted a greater number of consumers. With subsequent releases, the smartphone has increased in popularity and consumer base. This demonstrates the company has a stronger competitive position in this industry than in its personal computers industry. The product offerings the company has allowed it to differentiate itself and capture a significant portion of the market. Product diversification ensures the company is able to meet the needs of different consumers. The hardware design of its smartphone is unique and demonstrates the company's innovativeness.

The digital players market is highly competitive with various brands that are cheaper than iPods, but Apple has managed to maintain a 73% market share. All the other rivals have not managed to an achieve market share greater than 5%. This demonstrates the company has a stronger competitive position in this industry than in the PC industry. Incorporating and coming up with an integration platform that no other rivals have managed to replicate has offered the company the edge it requires.

Recommendations

The recommendations would be for the company to maintain the same trends and look for other avenues of improving on their product offerings. The product integration employed by the company for its products is effective, which has allowed the company can compete with its rivals. Keeping its technology secret and not licensing its operating software to developers has ensured the company can keep its software intact and reduce incidences of viruses or other attacks. The company should increase its software bug fixes, to ensure no attacks occur. This will strengthen its consumer confidence and increase its sales. Increasing its investment in R&D will allow the company to determine future trends and stay ahead of its competition. The costing of its products is high, which has ensured the company can maintain its revenues, but this has been hindrance to low-income consumers. The company could develop products that target specific consumers in the low-income levels, which would increase its market share.

The step taken with the introduction of the iPhone 5c, which was a cheaper smartphone based on the iPhone 5. The pricing strategy employed by the company could be its biggest danger. This is because the competitors have managed to produce products that suit different consumer needs. Nokia has developed a high-end smartphone, which it has targeted towards low-income earners in India. Continuous innovation should ensure the company could maintain its current market share. Innovation should also be used to increase the market share especially for the personal computers market.