Company Analyses – Apple Inc.
Apple Inc was incorporated in 1977 in California. The company engages in the designing, manufacturing, and manufacturing mobile communications, media devices, and personal computers. It sells variety of software, services, accessories, networking solutions, and third-party digital content and applications. The products and services of the company are iPhone, iPad, Mac, Apple Watch, Apple TV, IOS, Mac OS, Watch OS, tv OS, operating systems, iCloud, Apple Pay, and a variety of accessories, Mac app store, iBook store, and Apple Music. The distribution network for the product of Apple Inc. consists of retail store, online store, direct sales force, third-party cellular network carriers, wholesalers, retailers, and value-added resellers.
The target customers of the company are consumers, small and mid-sized businesses, education, enterprises, and the government. Apple Inc operates in highly competitive industry and has a name of ever evolving consumer technology industry. From the time of launching of iPod, Apple Inc has become every person’s product provider. At present, the Australia’s Apple niche group has invented iHome which is a unique which may revolutionize the building industry all over the world (Johnson, et al., 2017).
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The price elasticity of demand for the different products of Apple Inc. is inelastic. Apple Inc’s products are iPhones, iPods and other products. Consumers are willing to pay any price and go in for the purchase of iPhones. The factors that contribute for the inelastic demand for Apple products are broad consumer base, and product hype, but these factors are being counter balanced by lower prices of substitutes. The brand image of the Apple is so strong that make the
consumers ready to pay the premium. Consumers are willing to buy Apple product irrespective of price rise. The strength of Apple Company lies in strong brand image, high profit margins, and rapid effective innovation. This strong brand image enables the corporation to introduce profitable new products. The company adopts the premium pricing strategy that fetches huge profit margin to the company. Moreover, the company enjoys good competitive advantage due to the fact of keeping abreast with latest technologies (Microeconomics, 2013).
Apple Inc. (AAPL) is a widely known company in the manufacture of desktop, laptop, mobile computing devices, smartphones, and entertainment technology spaces. The primary competitors of AAPL are Dell Technologies, HP Inc. Lenovo group from China, and ASUSTeK Computer Inc. a Taiwanese company. In the smart phone sector, the tough competitors are Sony Corporation, whose latest product introduction is the Samsung Galaxy and Notes series that reduced the iPhone sales considerably. Samsung has attained the market leadership position especially in mobile phones and captured the market not only in Asia, but the whole world (Investopedia, 2018).
Threats of Apple Inc
The main threats of Apple Inc are:
- Aggressive competition
- Rising labor costs in various countries
The main competitor of Apple Inc. is Samsung and this company innovate new products very rapidly. The main threat for the company is imitating factors, and large number of local and multinational companies imitates the features and design of the product of Apple Inc. The next threat that has to be combated by Apple Inc. is to face the rising labor cost. The rising cost of labor, especially in China, reduces the profit margin of the company. To maintain the profit margin, the company has to increase the sales price of the product (Smithson, 2019).
- Apple Inc. (2017). Annual Report. Retrieved from http://www.annualreports.com/HostedData/AnnualReports/PDF/NASDAQ_AAPL_2017.pdf
- Johnson, D., et al. (2017). Apple Niche Market. Retrieved from https://danjohnsonpr.files.wordpress.com/2015/02/apple-niche-market-final.pdf
- Investopedia. (2018). Who Are Apple’s Main Competitors in Tech? Retrieved from https://www.investopedia.com/ask/answers/120314/who-are-apples-aapl-main-competitors.asp
- Smithson, N. (2019). Apple Inc. SWOT Analysis & Recommendations. Retrieved from http://panmore.com/apple-inc-swot-analysis-recommendations
- Microeconomics. (2013). Apple Inc. Retrieved from http://shireengantaylorian.blogspot.com/2013/06/apple-inc.html”