Apple's Swot Analysis

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Company Overview
Apple Inc. is an American multinational corporation which focuses on designing and manufacturing technology products such as consumer electronics, personal computers and software. Apple Computer, Inc. was established in Cupertino, California on April 1, 1976 and incorporated on January 3, 1977 by Steve Jobs and Steve Wozniak. The company used this name for the first 30 years until it removed the word “Computer” on January 9, 2007 to reflect its expansion into the consumer electronics market in addition to its original computer market. Apple designs, manufactures and markets personal computers, servers, network solutions, peripherals, mobile communication devices, portable digital music players, and related accessories, software and services. The company’s product portfolio comprises Mac computer systems, iPod portable digital music and video players, iPhone mobile phones, iPad portable multimedia, and Xsan and Mac OS servers. The company’s applications include Mac OS, iTunes, iLife, iWork, iClould, Safari, QuickTime, MobileMe and others. Apple mainly operates in the United State and manages its business primarily on geographic structure. It develops global market through five operating segments: the Americas, Europe, Japan, Asia-Pacific and retails. The company sells its products through online stores, retail stores, direct sale forces, and third-party resellers. It is headquartered in Cupertino, California and currently employs 49,400 employees globally.

Apple Inc. became the largest company in the tech universe on May 26, 2010 (Manjoo & Caplan, 2010). The company recorded revenues of $65,225 million during the financial year ending September 2010, an increase of 52% over 2009. The revenues derived from strong sales of iPhone, iPad and laptops. Its net income reached $14,013 million in 2010, making a huge increase of 70.2% over 2009. This exceptional growth is supported by its competitive advantages of its brand, management, technology and strategy.

SWOT Analysis

Strengths
-Strong brand image
-R&D driving innovation
-Robust financial performance
-Loyal customer
Weaknesses
-Product recalls
-Patent infringement

Opportunities
-Strong growth in smartphones market
-Continuing growth in PCs market
-Potential growth for music and applications
Threats
-Intense competition
-Dependence on specific suppliers
-Bargaining power of music suppliers

Strengths
Strong brand image
Apple has successfully built its phenomenal brand recognition all over the world. Apple’s brand awareness is very strong and covers entire its market segments. The company’s brand ranking has significantly improved during the last few years. According to Interbrand, Apple’s brand ranking improved from a thirty-fifth position in 2007 to a seventeenth position in 2010. Moreover, a new survey conducted by Brandz showed that Apple bypassed Google and IBM to become the world leading brand in May 2011.

Apple’s brand awareness is one of its sustainable competitive advantages. The company’s brand awareness strengthens Apple’s differentiated strategy and creates its market power. Therefore, the company not only maintains its premium pricing strategy but also creates significant demands for its products over years. For example, more than 108 million iPhones have been sold worldwide as of March 2011. The company spectacularly sold 300,000 iPads on the first day of its launch in the United State.

Research and Development
Apple’s core strategy is the product differentiation. Therefore, it has set a high standard for premium quality products in order to meet its customers’ expectation and generate new demand. It continuously invests in R&D to invent new products, provide new solutions and improve unique designs. Macbook, iPod, iPhone, iTunes and iPad are some of Apple’s innovative products which are famous with their superior ease-of-use, seamless integration and refining industrial design. Apple has a...
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