Apple Computers Prepared for Donna Lazdowski by: Justin Eder Jermyn Voon Maria Atienza George Isac Table of Contents
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- Problem Identification
- Company Analysis
- Industry Analysis
- Suppliers in Depth
- Competitive Analysis
- Strategic SWOT Analysis
- Strengths Weakness Opportunity
- Conclusions and Recommendations
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CI Dossier – B2B Marketing 3257-001 November 14, 2012 Apple Computers 
Prepared for Donna Lazdowski by: Justin Eder Jermyn Voon Maria Atienza George Isac Table of Contents Page #
Problem Identification ........................................................................... 3 Company Analysis ............................................................................... 4-5 Industry Analysis ............................................................................... 6-10 Suppliers in Depth ........................................................................... 11-13 Competitive Analysis ....................................................................... 13-23 Strategic SWOT Analysis ................................................................. 24-29 Conclusion and Recommendations ...................................................... 30 References ...................................................................................... 31-36 Appendices ..................................................................................... 37-49
Apple is one of biggest companies on the entire globe; it has a recognizable brand, customer loyalty, immaculate design, and products that everyone knows about (iPod, iPhone, iPad, iMac). Through its pricing strategy however, Apple has isolated many potential customers as their products are targeted with a higher price point to demonstrate quality and give value to the customer through design and efficiency. One segment of the market where they have very little market share is computers in the business sector. Most companies use PCs (which are Windows based) such as Dell or HP; very rarely will you see a company using Apple computers. This is because software is much more accessible with Windows. As well, PCs still have a majority over the consumer market; more people are comfortable with PCs over Macs. Speaking with companies, another area which is important to their decision is service and support, and companies such as Lenovo exceed that of Apples. So how can Apple improve their presence in the business sector focusing solely on the iMac product? Company Analysis Apple Inc. is a public, multinational American technology company founded by Steve Jobs and Steve Wozniak in April 1967, that started by selling their home-built computer circuit board called the Apple 1 (Gale Business Insights, 2012). The company is headquartered in Cupertino, California. Apple “designs, manufactures and markets mobile communication and media devices, personal computers, and portable digital music players, and sells a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications” (Apple Inc., 2012 p. 2) by designing, manufacturing and selling several different product lines like the iPhone®, iPad®, Mac® and iPod® (Apple Inc., 2012). The company also offers a portfolio of consumer and professional software applications, the iOS and OS X® operating systems, iCloud®, and a variety of accessory, service and support offerings" (Apple Inc., 2012, p. 2). Launched in 2007 in the United States, the iPhone is Apple’s smart phone and mobile head-set device that combines the features of an iPod with the capabilities of a mobile phone (Gale Business Insights, 2012). Starting in 2002 with the release of Apple’s first digital music player called the iPod, it has grown to include the iPod shuffle, iPod Nano, iPod classic and iPod touch (Gale Business Insights, 2012). This allows users to store their music portably and watch videos on the go. Apple introduces a revised product to the iPod called the iPod Mini in 2004. This iPod has the ability to hold 1,000 songs (Gale Business Insights, 2012). In addition in 2003, Apple launched the iTunes online store while opening its first international retail store in Japan during the same year (Gale Business Insights, 2012). The iTunes allows the users to download various forms of media such as music, videos, music videos, TV shows, movies and games. The Mac product-line is made up of the “MacBook Pro, MacBook, MacBook Air, Mac Pro, iMac, Mac mini and Xserve” (Gale Business Insights, 2012). iMac and a MacBook Pro which were both Apple’s first Macintosh computers were unveiled in January 2006 (Gale Business Insights, 2012). According to Gartner.com, they are third largest seller of mobile devices worldwide to the end consumer by a vendor with Samsung and Nokia, being first and second respectively (Gartner Inc., 2012). For a detailed look at Apple’s history and major milestones refer to Appendix A. Industry Analysis Buyers' Power Buyers of personal computers, especially for large and small businesses, schools and governments, are price sensitive. Since they buy in large quantities, bulk pricing is usually negotiated. Suppliers such as Lenovo have lowered their prices for the business sector market to remain significant in the industry (Gartner Inc., 2012). Apple with their higher price point may have to do the same or risk being left out of this market. The buyers also have longer buying cycles in accordance to replacement cycles of personal computers which industry analysts says may already have peaked this year (Gartner Inc., 2012). There are a number of companies that can supply personal computers to the business sector; however, the top 6 computer suppliers take 58.9% of the market (Fingas, 2012). Considering all these factors, buyers have moderate buyer power. Threat of Substitutes There would be a moderate threat in the industry for substitutes. According to Miller, “Windows-compatible computers (generally called PCs) and Apple computers (generally called Macs) are the two largest choices in computer shopping” (Miller, J., n.d.). This poses a huge threat for Apple Computers as they will need to compete to ensure that they offer enough benefits for businesses to use the Apple Computers instead of going to the well-known PC that has been used in various businesses before. In addition, Miller goes on to say that “due to PCs being more common than Macs in homes and business, there are many community programs and organizations that teach the computer illiterate about Windows, whereas this is less common with Macs” (Miller, J., n.d.). The threat of other substitutes is generally quite high because “PCs are made by several different manufacturers, including Dell, HP, Gateway, eMachines, and so forth. Almost all the parts in these separate computer companies are interchangeable; offering a convenience that Macs lack” (Miller, J., n.d.). Threat of Rivalry
Suppliers' Power The suppliers in the computer manufacturing industry have large bargaining power due to the fact that there are few that have the expertise to supply the right product at the right quality. For example, Intel and AMD are the two top microchip suppliers; they have been around for a long period of time and have achieved economies of scale allowing them to supply Apple with a great product at a low price. To reduce the risk of bargaining power of suppliers Apple should be looking at ways to mitigate that risk. In the case of microchips they are seriously considering abandoning Intel and manufacturing their own microchips which will reduce their dependency on Intel (Santario, A., 2012). Another example of how suppliers have bargaining power is in Apple's relationship with Samsung. Even though Apple has been in a dirty legal battle with Samsung, they are still doing business with each other since it is economic to do so. With Apple being such a big buyer they also have some bargaining power in the relationships with their suppliers, if Apple stops purchasing from a supplier it could seriously affect the supplier's revenues. Threat of new entrants The threat of new entrants is low overall because there are high capital costs for new businesses to startup and they would be competing against established brands which have achieved economies of scale. Because of competition there are also low profit margins in the computer B2B market so it would make it less attractive for new businesses to enter this market. On the other hand, this market has a short distribution channel because the computers would go straight from the manufacturer to the customer (business); this makes it easier for new entrants to compete. There would also be retaliatory responses from the established firms if they recognize a new entrant is capturing market share which makes it even less attractive for new businesses to enter this market. Political Threats of new political regulation or any change in the political climate is low. Minimum wage rules and worker benefits regulations have enticed Apple to outsource production to Foxconn in China. This outsourcing of jobs has always been controversial and it is a hard issue to tackle because it makes economic sense to seek the lowest cost for manufacturing your product. Apple enjoys great tax rules in the United States and from profits made abroad. For example, Apple paid less than 2 percent tax on profits made overseas (Cheng, R., 2012). These conditions are favorable and help the company grow, there is little threat that these conditions will change in the future. Economical Current economic conditions are optimistic; however this is due to governments stimulating the economy through inflationary policy. If the stimulus wears off or doesn't work as well as anticipated there is a threat the economy would go into a recession, particularly in the United States. This could affect Apple, as companies would be tight with their budgets, and if they do require computers they would make their purchase decision mostly based on price. On the other hand, companies in emerging markets could still provide good opportunities. The economic threat is moderate and should be taken into account if Apple chooses to expand their B2B marketing of computers. Another factor is the fact that Apple's profits are based largely on the iPhone and the iPad. The iPhone accounts for more than half of Apple's profits because they have the luxury to have a higher markup due to their brand recognition, as opposed to their competitors. When expanding into the B2B marketing of their computers they would not be able to have markups as high as on their mobile devices. Social
Technological Technology has a high threat According to Apple. Apple provides "technology that's flexible, powerful and scalable, supporting simple to complex scientific workflows” (Apple, 2012). The advances and rapid changes in technology expose Apple to a great risk as they will need to keep up with the latest technological advances. Apple uses an OSX Mountain Loin system for their Mac computers and use “Intel processors, advanced graphics, and notebook batteries that last up to 7 hours on a single charge” (Apple Inc., 2012). Apple also provide accessibility for people with different disabilities to use their Mac computers such as Voice Overs, Screen Magnification, Cursor Magnification, Picture-in-Picture Zoom, High Contrast Reverse Video, Safari Reader, Finder Views, View Options, Dock Magnification, Taking Alerts, Taking Calculator, Taking Clock, Converting Text to Speech and Safari and Cascading Style Sheets (CSS) for individuals who have vision impairments. Suppliers in Depth Apple uses over 100 suppliers to manufacture their computers (Moon, B., 2012). The three main suppliers to Apple and the industry are: Samsung Electronics Co., Ltd., Intel Corporation and Hon Hai Precision Industry Co., Ltd. (Moon, B., 2012). Some analysts believe that the suppliers are one of Apple's greatest risks in the future and should be carefully managed (Moon, B., 2012). Samsung supplies the displays for Apple's computers and also the memory for their computers (Moon, B., 2012). Samsung and Apple have a bipolar relationship because on the one hand they benefit from doing business with each other, and on the other hand they are competing against each other in the mobile industry. Due to their competition for market share, Apple has sued Samsung in many different countries claiming that Samsung has infringed on their patents (Moon, B., 2012). Apple has won their case in a few countries and have been awarded more than a billion in damages (Rose, M., 2012). Samsung has subsequently countersued Apple on infringing on their patents. This type of relationship that Apple has with Samsung can be risky for Apple depending on how easy it is to substitute Samsung as a supplier. So far Apple has continued doing business with Samsung and vice versa; both companies are perhaps locked in a mutually beneficial relationship where Samsung doesn't want to lose such a big customer as Apple, and where Apple don't see any alternatives in displays at the same level of cost and quality.
Foxconn is a supplier of labor for Apple and many other companies; they supply the labor and facilities required to assemble Apple products (Apple Responsibilities, 2011). Foxconn also has contracts with Sony and Microsoft among other companies (Apple Responsibilities, 2011). There has been much controversy about Foxconn's labor practices and reported situations where they have had children working in the manufacturing plants (Apple Responsibilities, 2011). All of this controversy has prompted Apple to audit Foxconn and other companies regarding their labor practices (Apple Responsibilities, 2011). Through their auditing they have found incidents of child labor as well as other incidents of unethical behavior (Apple Responsibilities, 2011). The incidents also had notes on what actions Apple has taken to eliminate further incidents (Apple Responsibilities, 2011). This is a great move for Apple to improve their image as a socially responsible corporation. Through increasing their transparency about labor practices Apple is positioning their brand towards the right area. Apple has some interesting relationships with their suppliers, and by being one of the largest companies in the world they are highly scrutinized by the public. Going forward, Apple needs to maintain the same level of high quality customers have come to expect from their products. Maintaining that quality could be challenged by the relationships they have with their suppliers. Competitive Analysis Apples Major Competitors In the business sector Apple computers are a step behind their competition in terms of market share. Companies such as Lenovo, HP and Dell are all ahead of Apple by a healthy margin. With price being a big concern for companies, historically speaking Apple has never had that advantage over their competitors. However other factors such as service and support have also played a huge factor in why companies such as Lenovo are often chosen over Apple. With Lenovo owning about 15% of the market they are seen as one of Apples main competitors (Dent, S., 2012). The next two highest are HP and Dell with similar or just lower market share presence (Dediu, H., 2012). Thus Lenovo, Dell and HP have been chosen to be Apples three competitors for comparison. Competitor Trends Not is all doom and gloom for Apple, current trends show Apple on the upswing in terms of gaining market share away from companies (Tecca, 2012). One possible reason as Horace Dediu puts it, “the secret to Apple’s recent success is the MacBook” (Tecca, 2012). This can be seen because the MacBook is known for its excellent design capabilities, as well as an integrated product. Lenovo however is also on the upswing with its market share seemingly increasing every quarter over the past few years. Lenovo in 2006 had about 7% of the market and now has more than double that (Gartner, 2007). Dell has been up and down over the past five years with a decrease in the mid 2000’s and increasing over the last few years, currently sitting at about 11% (Fingas, J., 2012). HP is the one which has seen its market share drop from 18.8% in 2010 to 15% in 2012 (Fingas, J., 2012. So with HP, Dell and Lenovo all having a similar market share, how can Apple increase their share? They can either gain market share by cannibalizing the other smaller competitors (Acer, Asus, etc.) or they can target the three mentioned and try to overtake part of their share. Either way, Apple would have to change its focus on business to business marketing if they want a shot at ever reaching a two digit market share. Dell
Brief History Dell was started by Michael Dell in 1984 while still in University (Dell, 2012). He dropped out of school to focus on his growing company and in four years brought the company public raising $30 million (Dell, 2012). Dell.com was launched in 1996 averaging $1 million in sales/day within six months of site launch (Dell, 2012). By 2001 Dell was the number one computer system provider in the world (Dell, 2012). By being innovative and constantly looking for new opportunities Dell has become a worldwide recognizable brand and is a top contender in the computer market in both the consumer and business sectors. Price Strategy For Dell their pricing strategy has changed over the years as their market share has fluctuated. Six years ago Dell continued to decrease their prices to stay competitive with the market (Montes, 2006). Part of the reason why Dell was able to offer low prices was because of its partnership with Intel who manufactured all the chips that were used in Dell computers (Montes, 2006). However that was six years ago and their partnerships are no longer exclusive and their competitors such as HP have been able to match Dell’s low prices (Montes, 2006). Currently their prices are average with the market with similar pricing to HP (Montes, 2006). Distribution, Service and Support Dell has a variety of methods of distribution to get their computers to their customers. They offer online purchase through their store as well as big name stores such as Best Buy and Staples (Dell, 2012). Having Dell hubs across the globe, Dells delivery is often quick with times only being held up with production of the computers as Dells are often customized to fit exact customer needs (Dell, 2012). They offer an array of services for the business sector which include business consulting, cloud-based services, financing, it consulting, and managed infrastructure services, to name a few (Dell, 2012). With these services in place Dell has a strong competitive advantage over their competitors as companies often choose Dell for their networking needs. Their support is vast with product support available in multiple ways, for example online, by phone, or in house technicians (Dell, 2012). HP
HP, which stands for its two founders Bill Hewlett and Dave Packard was founded back in 1939 (HP, 2012). As this was 1939 their first product was an audio oscillator which was used by sound engineers; this product would go on to be used for Walt Disney Studios (HP, 2012). According to a long search of over five millions pages and 117 journals, the first personal computer (PC) was by HP, made in 1968 (Clark, A., 2000). One reason for HP’s dominance in the business sector was because they started early; in the 90’s they targeted businesses, universities and research users to reach consumers (HP, 2012). In recent years HP has pulled out of various markets and strategically reformed the company to stay current with trends, such as cloud servers and software to deal with enterprise and government markets (HP Finance, 2011). Price Strategy For HP one reason why they have been successful in grabbing a large chunk of their market is because they have a bundle pricing method which means the more computers you buy the cheaper they are (Goldstein, A., 2009). They also include free upgrades to their products when you buy them, to help differentiate themselves from the competition (Goldstein, A., 2009). They try to differentiate themselves on pricing by offering special prices on their website; as opposed to not buying from HP.com (HP, 2012). Distribution, Service and Support HP computers can be bought from their website which gives consumers a comparison of various models and recommendations based on your business size and any services you may be interested in (HP, 2012). For businesses, small to large, they offer services such as networking, however unlike Dell they don’t offer many of the services Dell does (HP, 2012). HP's customer support has seen its ups and downs with opinions being that they are just average relative to the market as their coverage for their products isn’t as good as other companies, such as Dell (Langer, J., 2010). Lenovo
Launched in 1984 by Liu Chuanzhi and ten similar minded associates the company was funded by the Chinese Academy of Sciences (Lenovo, 2012). Their first PC was launched in 1990 in the Chinese market (Lenovo, 2012). The Lenovo brand was renamed from Legend when it expanded from its home Chinese market to overseas in 2003 (Lenovo, 2012). Unlike Dell, HP and Apple who all deal in multiple consumer markets (business and at-home for example), Lenovo focuses most of its efforts to increase their market share in the business sector, which has paid dividends over the last decade (Lenovo, 2012). Lenovo is currently the fastest growing major PC manufacturer (Lenovo, 2012). Price Strategy For Lenovo’s pricing strategy they came in under their competition with lower prices as they realized their brand isn’t as recognizable as their rivals (Dhar, S., 2010). They also have been implementing a "protect and attack" strategy which is to protect markets they dominate (China) and attack markets which are emerging (Dhar, S., 2010). With regards to profits, their protect option is a cash cow as it makes the most of its revenue, their attack option has to do with company growth and expansion (Dhar, S., 2010). As Lenovo is a global company they run different strategies around the globe; their European markets for example they adopted a value based pricing (Dhar, S., 2010). Distribution, Service and Support Lenovo has several different services it offers to meet consumer demands if any problem may occur. These services include financial, warranty, protection, transition services as well as a premium support; this wide variety and selection gives customers everything they need in regards to any issues they may have with their computers/system in the future (Lenovo, 2012). Their distribution is quite extensive with there being many ways to purchase Lenovo computers; you can buy directly from Lenovo’s website as well as multiple of online retailers such as amazon, Newegg and TigerDirect (Lenovo, 2012). In addition you can also purchase from authorized resellers such as softchoice, insight and CompuCom (Lenovo, 2012). With a wide array of purchasing options, Lenovo computers are easily available for any size company. Where does Apple fit?
Unlike their competitors Apples main focus isn’t on low prices, its pricing structure is set up as premium pricing (LeClaire, J., 2012). They offer their products at a premium price because they believe with their innovative design and different software within iOS the companies that need them, such as design firms, will buy them regardless of price (LeClaire, J., 2012). Distribution, Service and Support Apple offers various ways to purchase their products for business as you can also lease their products if you don’t want to purchase them (Apple, 2012). Purchase of Apple products for your business is more limited as if you want their business options you have to purchase through the Apple Store (Apple, 2012). Apple is excellent with covering their products with AppleCare. In addition they also offer very useful services for people new to iMacs such as training programs set up by Apple (Apple, 2012). Those who want to set up their network with Apple products can do so, and that service is also available for businesses (Apple, 2012). Advantages Apples key advantages are its high quality, excellent support and warranty coverage, and its high integration with all their other products. Apple’s strengths in its integration with all its products are something that its competitors just don’t have. The iPhone, iPad and iMac all communicate with one another with ease, speed and efficiency. Apple has overcome the price issues by offering a higher standard in quality and design over its competitors and if they are to succeed in the business market, they need demonstrate that quality to their customers. In addition, based on a survey gathering information on all the computer makers, Apples customer service, tech support and consumer satisfaction was the highest among the bunch (Laptop, 2012). With businesses relying on their computers so much in this era, company-customer relations should be high; with Apple’s superb customer and tech support, they need to use this to their advantage when getting new customers.
Further Analysis of Matrix Quality/Reliability Apple, Dell, and Lenovo have the highest quality and reliability of the bunch based on consumer reports and our interviews we did with a few local companies. HP has had the worst luck with quality as they are often at the bottom of consumer reports for quality and reliability. Brand Awareness As Apples competitors are the three leading companies in the industry, they all have high brand recognition. While Lenovo may not be well known with the at-home consumer market, they are well known in the business industry. This would potentially hurt in small start-up businesses. Variety of Products Everyone offers laptops, desktops, tablets and servers. Looking at each company’s computer selection Apple has the lowest selection. However they also offer the iPhone which, no other company offers. Integration with other Products Apple has a high integration because with their iOS platform, all their products are integrated with each other and can be used together. Their competition, while offering tablets cannot compete with Apple as Apple has more options available. The competition scores medium because they all offer server and service based programs which are integrated with a company’s main network. Cost Structure Apples one downfall compared to their competition is price. They simply cannot nor want to compete with their competition on price. Their competition all offers computers with similar hardware for lower prices. Apple differentiates itself because they design their computers to look beautiful, rather than be a hardware beast. Maintenance and Support From a survey that took every company into account, Apple scored the highest for customer satisfaction and customer support. Dell and Lenovo were tied for second and HP brought up the rear with a rather low score (Laptop, 2012). Distribution Channels Apple and Lenovo do not have the same distribution that Dell and HP have. Neither Apple nor Lenovo computers are as widely available as Dell or HP computers. Dell and HP have their computers in more stores, such as Staples. Services Offered Dell and HP both offer a wide variety of solutions dealing with small to large enterprises while Lenovo and Apple, while offering some services, such as financial help and product integration, they don’t offer the sheer amount of services the competition does. Strategic SWOT Analysis SWOT Analysis
Strengths Perhaps Apple’s biggest strength as company is their brand value. Interbrand, a brand management company, ranked them second in their 2012 Best Global Brands survey, while companies such as IBM, HP and Dell ranked 3rd, 15th and 49th, respectively; in monetary terms, Apple’s brand value translates to about $76 billion (Interbrand, 2012). Apple’s 129% brand value increase from 2011 increase also showed the reaction people had to the death of Apple’s prominent figure, Steve Jobs (Montgomery, 2012). According to Shanbhag (2012), their strong brand value not only comes from their product line but also by the experience people associate with the products - they call it the Apple experience. Shanbhag further linked the Apple experience with the brand’s reputation as a leader in innovation and design. Apple can use their strong brand value as a tool in positioning themselves in the corporate market as a brand that can deliver not only quality performance but a whole experience. The corporate sector is already familiar with Apple’s other products such as the iPhone and iPad, even RIM employees used iPhone over Blackberry, so they are already familiar with Apple’s operating system, the iOS (Shanbhag, 2012). This familiarity with the operating system is a strength for Apple computers. Apple has made it even easier to integrate and sync information between their products with their cloud technology and windows integration (Apple, 2012). The flexibility of their OS and the easy integration will help the corporate sector transition from the popular Windows OS to the iOS. Additionally, Apple has been trying to increase their corporate sales by catering to business needs. They have simplified setup of their computers to cater business needs with services such as Business Apps, Profile Manager and VPN Manager among others (Apple, 2012). Weaknesses Price and product diversity are key factors in the battle of the business computer market. Apple’s desktop iMac 21.5 inch computer retails for $1,499 (Apple, 2012). A similar sized Dell computer retails for $1,000 (Dell, 2012). It would be expensive for businesses to spend an extra $500 per computer considering the large order size for computers in businesses. Also, compared to Dell, Apple’s computer product line is smaller. Dell’s diversified product line is ideal for any sized business to choose which fits into their needs. Lenovo has recently made efforts to increase their corporate market share by positioning their products through price (Gartner Newsroom, 2012). Another weakness of Apple is their low market share in the PC industry. According to Gartner (2012), an information technology research company, Lenovo topped the 2012 third quarter worldwide PC shipment at 13 million units which is 15.7% of the market share; HP and Dell have 15.5% and 10.5% of the market share, respectively. Apple did not rank in the top 5 worldwide survey but ranked third in the U.S. survey with 2 million units and 13.6% of the market share. They are trailing behind HP’s 27 % market share and Dell’s 21.4% market share but Apple is above Lenovo, Acer Group and Toshiba at 8.9%, 6.5% and 6.5% respectively (Gartner Newsroom, 2012). These figures show that Apple simply doesn’t own a large share of the overall PC market share and this can translate to their presence in the corporate market as well. Further, International Data Corporation [IDC] (2012), a global market intelligence company, has seen a decline in the US corporate market demand for PC’s in 2012’s third quarter, thus making it especially tougher for Apple to increase their sales in the business sector. Opportunities All is not bad in Apple’s struggle in the computer industry. Jay Chou, a senior analyst of Worldwide PC Tracker, has said that it is already expected that PC sales will decline with the launch of the new Windows 8 (IDC, 2012). The launch of the new Windows platform has some people are either hesitant to embrace it or waiting for reviews of the new operating system. This is an opportunity for Apple to grab the market with their Mac OS X with the uncertainty surrounding the Windows 8. According to the Desktop Operating System Share Trend report by Net Applications (2012), a market share reporting service, the Mac OS has seen a steady growth of market share from December 2011 with 6.36% share to October 2012 with 7.26% share. These numbers may not compare to Windows market share, but there has been a decline of their share from December 2011 with 92.23% to October 2012 with 91.67% (Net Applications, 2012). The declining trend of Windows’ share is an opportunity to increase Apple’s Mac OS market share. Another opportunity for Apple to increase their computer sales is with the Asia Pacific Region. There was a 40% increase in shipment in the 1st quarter of 2012 to the Asia-Pacific region, even with the lack of new updates then (Hughes, 2012). Although in real numbers, PC’s still outpace Mac’s performance, this is still an indication of a growing potential market for Apple computers. Also, according to the same article it was mentioned that Mac sales in the business sector grew by a combined 10.4% yearly, whereas PC sales only grew by 0.1% (Hughes, 2012). Threats
There are two important threats to Apple Mac computers in the industry, the increasing tablets shares and the competitions' market share. Tablet computer sales are on the rise compared to other types of computers. It has been estimated that 25% of computers sold are tablets; plus, additional statistic showed that worldwide, 27.7 million tablets were sold in 2012’s third quarter alone (Tofel, 2012). This trend is not a big threat to Apple itself since they still hold a large market share of the tablet industry - 50.4% as of 2012 (Gibbs, 2012). However, the growth opportunity for Apple’s iPad might mean a potential threat to their Mac computers sales. Personal computer sales were down 8.6% compared to a 50% increase in tablet sales from last year alone (Tofel, 2012). If this trend continues Apple can expect further decline in sales of their Mac computers. Personal computer providers to businesses have continuing relationships with the market making it harder for Apple to grow into the industry. Dell has successfully established themselves as a personal computer provider to the business sector. Their revenue in the business sector alone is estimated to be a total of $15 billion (Menn, 2011). Also, Dell has been moving towards securing service contracts with large corporations, thus further solidifying their share in the business sector market (Menn, 2011). As in business to business marketing Dell has the advantage of already establishing personal relationships with their market, where as Apple still has to build those relationships. Strategic SWOT Analysis
Conclusions and Recommendations We posed the question, “How can Apple improve their presence in the business sector focusing solely on the iMac product”? For Apple to succeed and grow in the business computer market there are several options available to them that can lead to a higher market share. They need to use their competitive advantages to get them ahead of the pack, which is to demonstrate their products high quality, their above-standard support, warranty coverage, tech support, and their high integration they have with all their “i” based products (iPad, iPhone, iMac, etc.). By using their competitive advantages, of which they have many, they should continue to grow in the business market with companies continually searching for that best option. The Apple brand is a household name; the next step for Apple is to make the Apple brand an icon in the business industry. References Apple (2012) Apple. Retrieved from http://www.apple.com/business Apple Inc. 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Directory: wp-content -> uploads -> 2013 2013 -> International post doctoral research fellowship programme final report title of the research 2013 -> Seals Family History 1565 to 2004 2013 -> Rao bulletin 15 July 2013 html edition this bulletin contains the following articles 2013 -> R institute of technology school of foreign languages 2013 -> Provisional Programme – subject to change thursday 10th april 2013 -> June, 2013 National hiv testing Day Month Men’s Health Week Hurricane Safety Month 2013 -> In memory of the residents of the Parish Chesham Bois that served their country during wwii 2013 -> Federal contract awards in georgia april 2013 Download 143.25 Kb. Share with your friends:
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