Apple Computer Inc. started the personal computing revolution with their first all-in-one microcomputer that was a huge step above its competition. Apple’s strategies to foster their success involved analyzing the events and trends in the environment and providing innovative technology. Their most successful products include the Macintosh computer, the iPod , a portable “walkman like” player, the iPhone and iPad, a tablet type computer. Apple captured the market by providing technological advanced alternatives, in an impressive design enclosure which included added features and gadgets.
They created an exclusive application store and on-line music store that provided additional exclusive features for their products. Lastly, Apple developed partnerships with other companies to sell accessories for their products to support and promote their products. Apple’s success can be attributed to their understanding of the impact information and technology has on their business’s outcomes as it enabled their innovation, leveraged their talent, generated growth, impacted cost reduction, productivity, efficiency and effectiveness.
However Apple has not been as successful with customer satisfaction, handling complaints and dealing with product failures. Despite its issues, Apple has future plans to move forward using the same strategies that have proven to work for them. Apple’s success is tied to their vision of high brand recognition, minimalist philosophy and all inclusive marketing strategy Since Apple Computer Inc. started in 1977 as they paved the road in personal computing. Through its history Apple has developed its own strategies, marketing and success story.
Their secret began with the vision of their founders, basic philosophy of keeping it simple and effective business and marketing strategies. By providing superior advanced products with impressive sleek designs and a multitude of gadgets, additions and applications to go along with their main products they dominated their market. Apple did this by identifying their competitive market, analyzing the markets trends and events and creating products that led the industry. Their business strategy involved cultivating a new market from an existing market, providing innovative alternative technology with superior design, reating a business to business marketplace that is dependent upon their products by maintaining vertical integration. The first Apple computer was built in 1976 by a 21 year old visionary named Steve Jobs and his associates (Time, 2010,p. 1). Apple Computer Inc. business began by starting the personal computing revolution that gave them the first mover advantage in this new market. It was the first all-in-one microcomputer that did not require any extra circuitry to display text and therefore was a huge step above its competition (p. 2).
This invention soon led to the Macintosh which became the first affordable computer that had a graphical user interface, that is folders and icons (p. 3). Steve Jobs was the visionary of the company, and his vision of placing computing abilities in every home fostered Apple’s success. However, he also displayed uncontrollable zealot behavior that led the administrative board at Apple to fire him in 1985 (p. 4). Without a vision and the onset of their competitor, Microsoft’s Window 97, Apple’s place in the market shrunk to the fear of bankruptcy(p. 4).
Apple decided that without their visionary they could not succeed. Therefore in 1997, Steve Jobs came back to Apple to run the company (p. 4). The strategies to revive Apple involved environmental scanning, or analyzing the events and trends in the environment around the organization (Baltzan ; Philips, 2009,p. 21). Apple watched the competition and improved upon products based on the market’s reaction to them. One year after Steve Job’s return, the iMac was introduced. This personal computer was self contained and designed to be visually more attractive than the competition (Time,2010,p. ). Later in 2000, Apple came back with new creativity and introduced the iPod (Baltzan ; Philips, 2009. p. 3). This innovation was inspired as Steve Jobs watched the current market and noticed that millions of people were using their computers to make illegal CD’s from on-line services like Napster called MP3 songs (p. 3). His idea was to create a portable “walkman like” player that held thousands of songs, “iTunes” that people could download into, sort and navigate through (p. 3).
His vision was to give people a music library in their pocket that would be purchased on-line. His idea materialized into the iPod and in spring of 2003 the on-line store, iTunes Music Store, was created as the place where one could purchase and download individual songs (p. 3). The company sold 1 million songs in the first six days (p. 3). In a market that is filled with choices, Apple acknowledged that the consumer had the power to determine which product would lead the market.
Their strategy was not simply to compete with the competition but to lead the market in a new direction. In order to attract the buyer from their competition, Apple offered a superior technological advanced alternative, in an impressive design enclosure as well as added features and gadgets to go along with their products. Steve Jobs didn’t stop with the iPod, he continued to look to the future by adding new features and gadgets to go along with it. Therefore, in order to have the gadget one must purchase the iPod. In 2007, he introduced the new iPhone 4.
As Apple stated on its webpage, “Apple designers and engineers didn’t start with a clean sheet of paper”, instead they redefined what the phone could do and enclosed it in a sleek thin casing, making the “world’s thinnest smart-phone” (Apple,2010,p. 2). They used all the newest breakthrough technology, engineered glass, retina display, iOS processor, built in three axis gyroscope, two 5 megapixel camera with LED flash (allowing one to see the person they are taking to), high definition video recorder with editing capabilities, and a multi-touch display with innovative software (p. ). Of course in addition to these features Apple Inc. provides an application store with a multitude of applications one can add to their phone. Another Apple product that has been a huge success is the iPad. The iPad is a tablet computer about the size of a magazine that melds the laptop, smartphone, gaming console and iPod into a single product (Turrentine, 2010,p. 1). Its design mirrors the iPhone, and operates like it as it has a touch screen, the same menu, uses the same applications and has many gadgets to go with it (p. ). Although there are dozens of iPad alternatives on the market, this is the only one that has access to the Apple Application Store (p. 1). In creating a superior designed product that has features that no other product has on the market, Apple developed supplier power, that is to create a business to business marketplace that is dependent on Apple’s product (Baltzan ; Philips, 2009,p. 22). By giving other companies their blessing and shelf space in its retail stores, Apple supported the industry around their products (p. 4).
They created a network around themselves that supports the iPod, iPhone and iPad, provides direction for their product lines and increased the exposure of their products. Apple made this arrangement with hundreds of companies and thereby hundreds of products were produced (p. 4). For every iPod sold at least one accessory was sold with it (p. 4). There were recharger docks, digital camera connectors, TuneCast mobile FM transmitters and earphones to name a few (p. 4). This marketing strategy gave the main product omnipresence as when companies market their accessory, they inadvertently marketed the main product for Apple.
Despite all the advanced technology, the iPod, iPad and iPhone remained simple to use. Success in business depends on understanding ones customers, suppliers, markets and operations of each product or service the business provides( Baltzan ; Philips, 2009,p. 7). Apple understood that the consumer didn’t care about the technology, they were looking for an experience. Consumers are not interested in dealing with a new learning curve, they want to able to pick the item up and use it. Apple capitalized on this concept by creating few high brand products that all have distinctive human characteristics.
They are all “simple in design”, have “simple user interfaces”, use “high quality components” and “coherent hardware and software” (Schumacher,2009,p. 1). The iPod, iPad and iPhone do not have many buttons or different parts to open, exchange or reprogram (p. 1). this keep it simple approach is representative of Steve Job’s minimalist philosophy (p. 1). Through-out Apple’s history, the company has taken a proprietary stance. Apple owns most of the technology for its key products ( Lyons,2010,p. 1). This vertical integration has been very lucrative for Apple.
It has allowed Apple to provide an integrated system that works well together and allowed them to gain leverage in the market. At the same time, Apple’s refusal to be compatible with other systems has cost them a portion of the market. In order to use an Apple product one must switch everything over to Apple’s system. That presents a problem for those that fear the learning curve of using a totally new system, additional expense and inability to transfer files. Therefore Apple has made modification to its all inclusive policy.
To appease PC owners to purchase iPods, they decided to switch to a universal USB connections and charging protocol (Newcomb,2008,p. 1). They have also developed a new operating system, Snow Leopard, that will allow compatibility with Windows and Microsoft Office programs. Over the years not all of Apple’s products were successful and Apple has had their share of problems. The Apple TV, G4 cube, 20th century Mac, FireWire, Apple Pipin, iPod Hi-Fi are all examples of Apple’s failures (Evans,2010,p. 1) On one occasion Apple partnered with Nike to create the iPod sportkit (Baltzan ; Philips, 2009,p. 5).
This product ended up causing an invasion of privacy due to the security flaws of the radio frequency ID powered device (p. 5). Apple is also experiencing problems with their newest main products as well. Due to problems with the external antenna, the iPhone loses its signal and drops calls when held in certain positions (Moxley, 2010,p. 1). The rear camera white balance has been reported to stop working, yellow discoloration in the main view has been known to occur and the glass easily scratches and breaks(p. 1). The iPad has had WiFi problems that is connecting and reconnecting to particular services (p. ). The Macbook range of laptops lack connectivity, have battery issues and at times the connection has been known to melt after a certain period of use (p. 1). Apple consistently refused to accept any responsibility for any of the reported issues (p. 1). Only after months of angry responses from their customers did Apple attempt to pacify them by offering a bumper case for the iPhone and advice to hold the phone differently (p. 1). Every company will experience problems with their products. However, effective customer service should compensate for the issues by handling them appropriately.
Unfortunately Apple refused to acknowledge their problems and did not respond appropriately to their customers (Moxley,2010, p. 1). This of course angered the customers and led to litigation issues for Apple. Apple’s refusal to accept responsibility led to law suits accusing Apple of violating the “Federal communication Act, product liability related to negligence, defect in design and breach of implied warranty, intentional and negligent misrepresentation, fraud by concealment, unfair business practices and more”(Hughes, 2010,p. 1).
There is another class action suit as well accusing the company of intentionally crippling the first line phone with the new phone software in order to force the consumer to upgrade to the new phone (Chaffin, 2010,p. 1). Customer service is an essential part of any business’s success as after all a retail business cannot exist without the customer. Customer service can be defined as a working relationship the business establishes with the customer (Thompson,2002,p. 1). It involves being approachable, responding to messages, paying attention to details, anticipating needs and honoring promises (p. 1).
Apple’s success can be attributed to their understanding of the impact information and technology has on their business’s outcomes as it enabled their innovation, leveraged their talent, generated growth, impacted cost reduction, productivity, efficiency and effectiveness (Baltzan ; Philips, 2009,2010,pp. 7,8). However Apple has not been as successful with customer satisfaction, handling complaints and dealing with product failures. A business is more than technology, it’s also about people and information (p. 12). If a company is not careful to work all the functional areas of the business together, the business is at risk to fail (p. 2). Despite its issues, Apple has future plans to move forward using the same strategies that have proven to work for them.
They have a new iPad 2 coming out in 2011 that is said to be the next generation with features such as video phone, 3 axis gyroscope, better mobility and a USB connectivity (Watson, 2010,p. 1). The iPhone 5 is also scheduled to be released in 2011. It is anticipated to have resolved the design issues of the iPhone 4 such as the external antennae issue and include features such as 3G enabled version of FaceTime and a payment feature called phone wallet (Watson,2010,p. ). Finally, one can not discount the new Macintosh PC. The new Macs will be able to run window programs right along with Apple’s software (Bloomberg,2006,p. 1). Mac Pro is more powerful, has more memory and runs faster than ever before while remaining energy efficient and offers the sharpest graphic display (apple, 2010). Of course Apple also has a new ultrathin laptop, the Macbook air, and a new LED high resolution display, the iMac, to add to their collection of new innovative products (apple,2010).
Apple’s strategy of being a second mover and entering the market after ideas are introduced and analyzed and creating differentiation has paid off. They have successfully gained a competitive edge by determining the current trends and taking advantage of the latent demand. With ingenious improvement in the technology, fulfilling the desires of their customers, introducing the new idea faster than their competitor, using creative advertising and effective business management, Apple has successfully captured their market.
Despite all the problems and setbacks, Apple continues to raise the bar of the computing industry’s technology and thereby keeping their competitors struggling to keep up. Apple doesn’t concern themselves with the new entrants into the industry or engaging in rivalry with their competitors, they just focus on keeping years ahead of the competition (Baltzan ; Philips, 2009,p. 23). Apple’s success is tied to their vision of high brand recognition, minimalist philosophy and all inclusive marketing strategy.