Apple Inc. 2010 Case Study

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Apple Inc. 2010 was founded in 1976 by Steve Jobs and Steve Wozniak as Apple Computer. It was best known for its Macintosh PC. Despite its strong brand, rapid growth and high profits in late 1980s, the company almost went bankrupt in 1996. Jobs rebranded it as Apple Inc with innovative non-PC products starting early 2000’s. pg. 4-1 and 4-5, p. 2 and 4.
Apple’s flagship product was PC. The first PC was produced in 1976. Apple quickly became the industry leader, selling over 100,000 Apple IIs by the end of 1980. Its competitive position changed with the entry of IBM in the market in 1980. Apple responded by producing Macintosh. The PC had technical elegance, was easy to use and had industrial
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Threat of substitute-Moderate
Other products such as PDAs, tablets and Smartphone provide some features of the PC.
Supplier power-Moderate
The suppliers of components such as software influenced pricing.
Apple opened a retail store as a result of changing industry dynamics. This strategy was meant to expose consumers to directly use and experience Apple’s software. This retail experience gave many consumers their first exposure to the Macintosh product line. The retail stores grew to account for 16% of Apple’s total revenue. Pg. 4-15 P. 34
Proprietary, Apple developed applications so as to support the Macintosh line. This was as a response to the changing industry dynamics. 4-15 p. 33
Operating System
As a response to changing industry dynamics, Apple introduced a new OS in 2001. It issued upgrades every 12 to 18 months, in greater frequency than what Microsoft had done with windows. pg 4-14 p. 32
Shift to Intel CPU
Apple introduced the first Mac computer to run on an Intel chip in 2006. The chips enabled Apple to produce laptops that consumed less power. pg 4-14. p.
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Differentiated product
My analysis shows that Apple was a market leader in production of innovative and highly differentiated products. Both the iPod and iPhone stood out in the market because of their unique features.
Fast innovation pace
My study shows that Apple beat its competitors by leading in innovation. An example is that of producing iPod in 2001 and iTune in 2003.
High margins
Apple has positioned itself as a company that produces high quality differentiated products. This has seen them price their products higher than those of their competitors hence enjoying high margins from their loyal customers. iPod ASP was priced $50 to $100 higher than competition. The first iPhone model was priced at $499, hence being among the 5% worldwide to account for mobile phone sales.
Visionary leader
My analysis shows that one of the key strength’s of Apple was its visionary leader. Steve Jobs was very swift at responding to threats. His decisions ran from buying off competitors to leading his team to produce innovative products hence enabling Apple to remain relevant in the market.
Low margins-iTunes iTunes faced stif competition hence attracting low margins.

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