Apple has relatively few weaknesses. The company's emphasis on software, marketing and design has left it with a weakness in hardware. Apple products do not have the superior lifespans one would expect from a product commanding a premium price tag.
Another weakness is the dependence on leadership. Apple without Steve Jobs simply does not perform as well as Apple with Steve Jobs. Jobs is responsible for driving innovation at Apple in particular, and his involvement is a cornerstone of the company's innovation strategy. The importance of the leader is such that negative news concerning his health cause the company's stock to drop sharply. The health of Jobs has been a concern for several years and his departure is expected to have a negative impact on the company's fortunes (O'Toole, 2010).
There are many opportunities for Apple. With the high profile launch of the iPad, the company clearly sees tablet computers as a strong growth opportunity. The product exploits what the company feels is a niche with tremendous potential, currently occupied by products such as e-books and netbooks (Enderle, 2009).
Growth represents another significant opportunity. The company has both organic growth as a potential and overseas growth. The company's recent run of success has come as a the result of building market share in its segments -- organic growth. This is an opportunity that can be exploited for a long time, given Apple's relatively low market share outside of mp3 players. Overseas growth is also an opportunity, given Apple's low profile outside of the West. By extending the company's reach into the world's emerging economies, Apple can grow rapidly for years to come.
There are a few threats to Apple. The economy is not one of them. Competition, however, is. Apple competes against some of the world's largest, best-capitalized and most-recognized brands. This competition is intense and is expected to continue to be so for years coming. Competitive response to Apple's endeavors is expected to be strong. The company's dependence on innovation means that it is subject to a threat from innovation -- if another company takes over Apple's technological leadership, Apple will see reduced revenues as a result.
Market-Product Focus
Apple's objectives should be to increase revenues to $60 billion in 2010. The company should sell 1,000,000 iPad units and should increase its market share in other areas by five to ten points. The target market segments for Apple should not change -- the focus should be on greater penetration of existing target markets.
Apple has a broad target market. Their core is made up of users with higher education levels and higher disposal income. They are between 18-50 years old, live in Western countries and view themselves as unique individuals. It is a fallacy to suggest that Apple should concentrate on niches -- mass market companies are fundamentally different from niche companies. You cannot do $60 billion in business selling to niches, you need to sell to broad spectrum. While Apple understands its target market, that market is by necessity loosely defined; the company characterizes it as roughly "anyone who aspires to live a more creative life" (Morrison, no date).
Apple appeals to its target market with innovative products, innovative product design and with premium branding. The proprietary software serves to emphasize the differentiation of Apple products, as they are not compatible with the products of other manufacturers. The target market finds appeal in the relative uniqueness of Apple products and the snob appeal that goes along with that. Apple's premium positioning leverages this differentiation to promote a premium image of the product and to extract higher prices from the consumers. The focus on consumers with higher income levels is mainly out of necessity -- Apple prices itself out of lower-end markets.
Marketing Program
Product. Apple has a range of products to be promoted. These include computers, mp3 players, smartphones, tablets, applications and software. The corporate Apple name is a strong selling point, but within in each category there are brand families (iPod, Mac, iPhone). Within each family there are product brands (MacBook, Nano, 3G, etc.). Packaging is not a major component of the marketing scheme, due to the focus on online sales and the in-store presentation that emphasizes the design of the product itself. Apple sells warranties, and derives a respectable amount of income from them. That strategy should not change.
Price. Apple's products command premium prices. The basic idea should not change, but there are elements that could be adjusted. In the less differentiated categories such as smartphones, Apple should price the phone at a more competitive level and place the emphasis on revenue generation from software and applications. With its computers, the prices should come down somewhat as they have not been subject to the same high...
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