Question 1:
Which of Porter’s four competitive strategies does Apple engage in? Explain. Scope | Broad | Cost Leadership | Differentiation | | Narrow | Cost Focus | Differentiation Focus | | | Cost | Differentiation | | | Source of Competitive Advantage |
Figure 1.0: Porter’s four competitive strategies
Porter’s four competitive strategies does Apple engage in are cost-leadership strategy, differentiation strategy, cost-focus strategy and focused- differentiation strategy. Explanation is as below. 1. Cost-leadership Strategy
Apple used to identify customers’ specific needs and designed to meet their needs. The cost strategy here can be clearly shown when Apple design iMac computer and iBook
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People like to feel that they are unique individuals with their own needs and desires. One of the best strategies for dealing with competitors is to offer customers exactly what they want, when they want it, and how they want it. The Internet provides a new outlet for mass customization by allowing customers to order one-of-a-kind products. For example, Apple uses product differentiation to help market its iPod and online music system to a broad swath of the population and create barriers that its competitors are having difficulty overcoming. 3. Cost-focus strategy
This strategy is crafted to give customers by incorporating good-to-excellent product attributes. A typical example is the incorporation of iPod digital music player, iTune website for the sale and download of music in the computers provided users of Apple Computers Value for money. 4. Focused- differentiation strategy
Apple has differentiated it products focusing on the professionals and producing computers tailored to meet exact needs professionals. Computers designed for professionals have complex functions that meet their today's requirements. Focus strategy based on cost. This strategy is concentrating on narrow market segment by providing low cost products to the segment. Apple has achieved this through the production of iBook computers to serve the customer section.
If an organization is in a fiercely competitive market, it can choose to focus on a very narrow segment of
Apple Computer uses focused differentiation to help sell its computers to a narrow target market of graphic designers and educators rather than the general population of computer users. Apple’s innovation on the ITunes store together with the widespread use of the IPod. The corporate strategy is focused on being a market disrupter, and in turn a market maker, by focusing relentlessly on the customer experience.
Apple Incorporation is one of the largest organizations dealing into Information Technology. Apple has a host of products ranging from Laptops, Desktops, Mobile Phones and Multimedia Devices. The company has been extremely innovative in the field of multimedia and it owes it success to one of the greatest innovators, Steve Jobs. The company has always believed in innovation and that is the major reason why it has been so successful in the mobile phone segment. In recent years Apple is second only to Samsung in the Global Mobile Phone industry. However the operations have been largely based in the United States and in times of recession any organization needs to focus on economies of scale and thus focus on growth
By making their products differentiated from the competition, Apple can establish their own price. Apple believes that people will pay some more money if they know that what they are buying is better and more reliable. That is also the reason why Apple sells the same products all over the world, making no selection or differentiation depending on where the market takes place. The high costs of Apple’s products are the one of the reasons why Apple Inc. preferred to be
Apple was established as an IT company dealing in exclusively in computers. However, competition in the technology sector forced the firm to focus on other consumer products. The diversification strategy has seen Apple’s sales grow tremendously in the last decade, earning the firm the No. 1 brand position at Forbes. The Apple brand is recognized on an international scale and enjoys a strong recognition thanks to its aggressiveness when it comes to creativity and innovation (Tar, 2013). It has a large number of loyal customers who would purchase the new products regardless of the market price, which guarantees profits from the new division.
The strong competition among rivals pursuing a similar strategy is vastly based on product differentiation and a niche market attraction, as companies are constantly working to surpass their competitors and seek to provide just what certain consumers want.
4.7. Which of Porter’s four competitive strategies does apple engage in? Explain. Out of the four competitive strategies according to Porter, Apple engages in a focused differentiation strategy. Apple has been very successful by creating different products and services from competitors that are innovative, high quality, and user-friendly. From their unique product designs, to their state-of-art development of operating systems and software, Apple’s has continuously exceeded the evolving consumer demand in the current market. Furthermore, due to their open and inviting sales floor at their retail locations, genius help desk, and well trained sale peoples, Apple has welcomed more than a billion customer
The competitive advantages realized by Apple have catapulted the organization to the great heights it enjoys presently. The hardware design forms one of the major competitive advantages. Indeed, the products of Apple are elegant and well designed and every vendor concurs that the products have no equal in the market in terms of design. The laptops, desktops and phones produced by Apple are always designed right for the first time and this puts them ahead of the competitors in the market. Another area where Apple has much competitive advantage is marketing of products (Schulze, 2011).
First, Apple introduced a new OS in 2001. Second, Apple shifted to Intel chips and by the following year all Macintosh line ran on Intel making laptops run faster for less power. The third strategy was the development of proprietary set of applications. The fourth strategy in becoming the “digital hub” was to come up with a new distribution strategy: the Apple retail store, where customers can have a direct use and experience of Apple’s product and software.
Apple pursues a differentiation strategy since it started in 1976. Only one time they offered a computer aiming for the mass market, but soon came back to their differentiation strategy. This differentiation strategy was at one point supported by a strong promotion campaign, with the goal of to ‘differentiate the Macintosh amid intense competition in the PC industry. Apple has always been a very innovative PC manufacturer. Through excellent R&D, Apple always managed to launch PC innovations on the market. Although the products sometimes showed weaknesses, the innovative role still gave Apple a lot of attention. Apple designed its products typically from scratch,
Even though Apple has encountered many setbacks, it continues to bring new and improve products to the market. Apple’s competitive strategy has been innovation. They have made an extraordinary effort developing, implementing, and executing its very unique strategy through innovation which has resulted in new product, and the enrichment of the existing ones. More specifically, Apple attempts to meet and supply the needs of a global market, by offering eager and enthusiastic consumers with innovated and high-quality products and services. Apple has employed a differentiation strategy linked to innovation with its three core products (computers, personal media player, mobile phones, tablets and other accessories). A key piece of their strategy involves meeting the needs of the converging digital electronics and computer markets. Apple has elected to implement its strategy by designing and developing proprietary operating systems and software technologies, thus allowing for strict protection of its intellectual rights.
Apple has done an excellent job of developing a very distinct strategy through industry leading innovation. This strategy has allowed them to be the frontrunners in new product introductions and the improvement of existing products. Apple has employed a differentiation strategy in an attempt to meet the needs of a global market by offering customers innovative new products and improved existing products. An important part of their strategy involves meeting the needs of the evolving digital electronics and computer markets. Apple has chosen to implement its strategy by designing and developing its
Nowadays, Apple has positioned itself to be an innovator in the personal computer industry and Apple has developed by offering modern products compared to its competitors. According to Apple’s mission statement last year, “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.” (Business Management,
This Appeals to a broad cross-section of the market by providing products or services at the lowest price. This requires being the overall low-cost provider of the products or services (e.g., Costco, among retail stores, and Hyundai, among automobile manufacturers). Implementing this strategy successfully requires continual, exceptional efforts to reduce costs -- without excluding product features and services that buyers consider essential. It also requires achieving cost advantages in ways that are hard for competitors to copy or match. Some conditions that tend to make this strategy an attractive choice
Apple has always been something of a trendsetter in the tech space. Its product history since Steve Jobs’s return in 1997 gives us a solid list of examples to choose from, from its very first iPod, to Apple’s PowerBook (and later MacBook) lines, to the iPhone and the iPad. Apple’s history is dominated by products that existed before Apple had a crack at them - but it was Apple who simplified them, made them appealing on a much wider scale, and ultimately made them objects of desire for the masses.
This report will identify the positioning of Apple’s notebook product line ‘MacBook’ to its relative competition by the use of marketing concepts such as; segmentation marketing, target marketing, buyer behaviour, product strategy and how the company has enhanced the product over the years.