SWOT ANALYSIS OF APPLE

STRENGTHS

Apple as a brand has always offered better products when compared to its competitors. It

has always positioned itself to be one of the first in the industry of personal computers. Its

strength lies in the fact that it has always produced hardware that has remained original and

authentic thereby controlling its operations and well as manufacturing. Thereby self

sufficiency has always remained as one of its major strengths.

A major strength of Apple is its technical superiority and high quality that it stands for and

shows in the products that it manufactures. The company focuses a lot on research and

development so that they are able to create better and more efficient products. This thus

gives rise to high technically savvy products that can be easily used by the consumer. The

products thus produced are distinct and becomes very costly for other companies when it

comes to imitation. The retail stores where Apple sells its products is also another strengths

as it gives the customer an experience of the product along with an environment to feel it.

The company has always had customers who have remained loyal to the brand. The main

reason for it is the superior quality and aesthetics even though it remained at the upper

edge of the price spectrum. The loyalty shown by Apple’s consumers has always been very

difficult for others to imitate. This huge base of consumers has also given the company

financial stability. Even when the hardware market was showing flatness in terms of growth,

the company had good monetary reserves. The company has stocks which are priced

highest in the industry. The company is also fully equity financed and has no debt.

Main strength for Apple has always been its former CEO, Late Steve Jobs who helped turn

the company around in terms of stress and helped bring back the company to its former

glory.

WEAKNESSES

Since the company has been updating its products with respect to newer changes of

technology, it would still have to continue so to have a good position in the market. Since

there are chances that other companies would try to imitate its products, it has to always

bring in newer innovations within its products to remain different from others. Another

weakness of the company is that due to higher price when compared to its competitors, it

has a lower market share. Steve Jobs has been strongly associated to the company and its

products that his departure had a negative effect on the company.

OPPORTUNITIES

Since Apple is famous for being innovative in its products and thinking, it can also foray into

other consumer electronics and thus capture the entire market. With the introduction of the

iPad mini, it can also tap into the tablet market (small) as there are greater opportunities for

success here. It can also thus prevent the cannibalisation on ipad that was happening due to

launch of cheaper tablets by other companies. There is a highly growing hardware and

software market which can also be tapped by the company as it has started introduction of

processors that are Intel based. The markets where the company operates, like the

computer hardware market and the smart-phone market are highly unsaturated. This gives

the company greater room to innovate and capture. There are greater opportunities for the

company as it is highly innovative and there is always need and consumers for such

products in the world.

THREATS

There is always competition from other technology companies in the field as they are priced

lower than Apple. Another reason is because even though, Apple is superior to them on

technology and aesthetics, it is not very difficult for them to imitate and thus eat up its

market share and consumers. There is greater chance than its products would get

substituted with other lower priced products of its competitors. There are still chances that

more issues related to copyright infringement would creep up in the future as the various

packages of software and systems can be easily imitated. There are chances that the

number of consumers who would become more conscious about spending would increase

in the long run. This would not allow the company to tap into that segment with the existing

portfolio of products and would lead to a loss of market share. In case the company is

unable to innovate and produce newer products, it would lead to loss of brand image and

loyalty. It can be seen that it is difficult to keep on innovating continuously and it would lead

to increased R&D expenditure.

STRATEGY

The main strategy applied by the company is innovation thereby providing greater product

differentiation. The company was always innovating be it from the beginning when it

introduced PDAs, later introducing the iMac, then going in for an operating system that was

highly stable and functional. They undertook differentiation so that they could capture both

the portable computer category as well as the desktop category. Then the company went in

to launch the iTunes, thus creating a digital lifestyle. The online retail stores of Apple are the

major differentiating factors when compared to their competitor as it gives the consumer

the look and feel of the company as well as an environment where the products can be

displayed in style. The iPod was launched later by Apple thereby changing the way its

consumers listened to music. The innovation and differentiation can also be seen from the

way they developed sleek laptops different from the rest of the industry.

Product differentiation is a strategy which is highly viable and the company has been doing

so in the spheres of features related to the product and product types. It thus became a

company that was focused on innovation thereby covering a large number of segments and

producing products that can be used easily.