apple inc. - economical success story
TRANSCRIPT
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Video to be added…
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Apple: Strategic Management Case
Study
Imran Khan
Saurabh GuptaShreshtha Jaiswal
Subhash
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Where is Apple Located?
• Apple’s main headquarters is located at 1Infinite Loop, Silicon Valley, California.
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Where is Apple Located?
• Apple has also expanded internationallywith locations in Cork, Ireland andSilicon Valley, Singapore.
Cork, Ireland Silicon Valley, Singapore
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Where is Apple Located?
• Apple has over 200 retail locations across theU.S. To find a store nearest you, Apple’s mainwebsite provides a search engine that canprovide that information.
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Apple, Inc.
Now• Founded 1977
• HQ Cupertino, Ca. “The Mother ship”
• Largest U.S. company ever
• 72,000 Employees
• 34 Patent Applications in October
• 80% of revenue is from new products sold from
Mid Sept to M/E Oct
Competencies1. Simple, Well Designed, User friendly
2. Innovative Culture of Design
3. Loyal Customers
4. Technology iOS
5. Energy Efficient
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Internal Assessment
1. Operational Focus - Willing to release incomplete products
2. Wall Street - Engaging to increase dividends
3. Shifting Values - MBA vs. Liberal Arts
4. Relaxed Atmosphere - Leadership quiet yet demanding
5. Highly Ethical ?- Some might question
• Procurement
• Vendors
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Change is Inevitable?Release history
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LEADING INDICATORS
&
DEMAND DRIVERS
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Demand as a F(x) of leading
indicators
D = f(li1, li2, li3, …, lin)
Market Share: Stable
Search trends as an early indicator: Who has it?
Networking effect
Sharing
Social Nets Social Networking capabilities
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Economic Leading Indicators
Demographics
World Progress Indicators
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Leading Indicators: Product Drivers
Product Drivers:
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Mobile browser counter as a
leading indicator ?
ANDROID
iPhone
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EXTERNALITIES
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Smart Phones: Competitors
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iPhone, Android or Windows Phone ?
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Mobile computing: Laptops &
Notebooks
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Key Success Factors
• Design
• Miniaturization
• Security
• Ease of Use
• Reliability
•
Marketing
Open Systems
Improve + Innovate
“Closed” Systems
Cool! SecureReliable
Reduced Cost of production
Improved Sales & Margins
V AL
UE
+++
$$$
FreeBSD
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Target Market
B2B Market B2C Market
Enterprise + Government
SMB$$$$$ Class
$$$$$$ Affluent
Premium PricingEducation
G
BOP $
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Smart Phones : 71% CAGR for the next 4 yrs.Cloud computing : 20% CAGR
Mobile dev. in general: 25%
*nomic
02
*provisioning
Carrying
Capacity ???
Convergence
INDUSTRY GROWTH & MARKET SHARE
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Smart Phone: Market share growth
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The mobile worldwide market in 2010
Apple as a Mobile browser leader In
2010
iPhone Mobile market share
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iPhone Mobile market share2012
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What about the iPad ?
• Apple has 68% of the tablet market
• Cannibalization of iPad by the mini iPad?
• Google & Others TabletsOpen source to the rescue?
App store: Closed platform ?
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The Apple Retail Store
• Employees:
• Apple Specialist: Knowssoftware, inside and out
• One-to-One PersonalTraining: Hour Long
• Free Workshop-Group:Training
• Genius Bar: Damaged
product assessment
• Concierge: Help you findanything is in the store
• Activities:
• Local Gathering Place
• Free Musical
Performances• Entertaining/Informative
Presentations
• Youth Workshops: Year-round
• Apple Camp: Summer• School Night: Students &
Teachers showcase ownwork done on Mac.
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• “When you first start off trying to solve a
problem, the first solutions you come up with
are very complex, and most people stop there.
But if you keep going, […] you can often timesarrive at some very elegant and simple
solutions.” ---- Steve Jobs
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Apple re-legitimize vertical integration
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Competitive Advantages of Apple’s
vertical integration
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Sell at a Premium
Apple’s profit comes from
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Apple’s profit comes from margins in hardware (iPad/iPhone)
Big picture: hardware drives
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Big picture: hardware drivesApple’s gross margin
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Cross-sell your product line
Wh i h iC ?
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Who is the iCustomer?
• Product line covers all markets, all price
ranges, all needs with an accurate
segmentation.
• Product lifecycle: each new product
implements appealing new features, stronglyinducing the loyal iCustomer to buy new
products (iPhone 4 to iPhone 5)
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iP d d iPh d i M l
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iPod and iPhone drives Mac sales
Integration reinforced by retail
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Integration reinforced by retailstrategy
Apple Stores are a place where the company can:
• showcase a 100 % Apple environment (to appeal the iCustomer )
• have a trained sales force selling its products.
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H did A l th h ?
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How did Apple cross the chasm?
Lessons learned from its failure in 80’s
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Lessons learned from its failure in 80’s
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Think Different!!!
What was Apple’s vision of Computing?
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To make it happen Apple is investing
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pp pp gin cloud
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Assessing Risks and Competition
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Worst-case scenario:
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How could Android kill iOS?
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Conclusion
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Conclusion
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QUESTIONS???
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THANK YOU!!