Those that are relevant to apple are product features, product mix, links with other firms, and reputation. One example of differentiation strategy is apple inc. Nov 28, 2018 apple s pricing strategy extends to its differentiation in the retail electronics marketplace. Apple attempts to increase market demand for its products through differentiation, which entails making its products unique. Gates recommended that apple license macintosh technology to 35 significant. Differentiation mastering strategic management 1st. Apart from its differentiation strategy, the major points to look at are 1 brand loyalty and 2 its iphone buzz across the world. From its macintosh home computers to the ipod music players and iphone and ipad mobile devices, apple has employed a differentiation strategy to target a. Pdf on jan 1, 2014, john mcgee published differentiation strategies find, read and cite all the research you need on researchgate. A company can set itself apart from other competitors through its product. Product differentiation business strategies 6 strengths. While the result of swot matrix, an alternative strategy that can be used is so strategy. Aug 10, 2020 product differentiation is a viable strategy, especially if the company exploits the conceptual distinctions for product differentiation. For apple, there exists a strong unique differentiation.
Pdf strategic leadership and innovation at apple inc. Apple business strategy consists of the following four elements. When ceo steve jobs announced in january 2007 that apple would be releasing. A famous cliche contends that you get what you pay for. Nov 21, 2018 apple differentiation strategy learn more apple corp. This commonly neglected differentiation opportunity provides a multitude of ways to stand out from the competition. Marketing strategy of apple inc apple marketing strategy. The company has accomplished serial innovation and outstanding design in terms of its offerings and its business model. Apple differentiated its product by focusing and producing on two market segment, the consumer and the professional market. Apple produced differentiated products with features that multiple niche market segments and pay for but apple also makes products in the form of competitive cost so that. One example of differentiation strategy is apple inc businesses use the marketing strategy of product differentiation to distinguish their products from those of their competitors. For example, when apple cofounder steve jobs returned to apple.
The advantages of a product differentiation strategy. International business and organizational factors apple. Apple competes in a highly competitive industry that has high buying bargaining power. Pdf a study of product differentiation strategy in. But in the era of hyper competition, a successful differentiation strategy. Product differentiation is a viable strategy, especially if the company exploits the conceptual distinctions for product differentiation. Apple differentiation strategy alevel business studies. Offers strong graphic performance with great design. This strategy can be used in all subjects just like using quicktime player for mac. Business level strategies of apple 97 words bartleby. Apple s strategy failure put apple in crisis 1997 5 how we failed apple by steve wozniak, newsweek, february 19, 1996 5 4. Apple has succeeded in creating demand for its products, giving the company power over prices through product differentiation, innovative advertising, ensured brand loyalty, and hype around the launch of new products. Businesslevel and corporatelevel strategies businesslevel and corporatelevel strategies analyze the businesslevel strategies for the corporation you chose to determine the businesslevel strategy you think is most important to the longterm success of the firm and whether or not you judge this to be a good choice. Since 1980s apple has successfully used the differentiation strategy to separate their product in the market from other competitors.
A firm following a differentiation strategy attempts to convince customers to pay a premium price for its goods or services by providing unique and desirable features figure 5. Industry analysis business policy and strategy ijser. Jan 11, 2019 when plotting the bcg matrix of apple, the product portfolio of apple is clearly divided into four parts the cash cows are products which are existing since ages and which cannot be challenged in the current market conditions and have a majority market share when the global data is referred these are macintosh, iphone, iwatch 50% market share in 2015 and itunes a solid support service. This strategy is used in all aspects of the company in creating new products and has brought them tremendous success. As seen in the companys vision, mission, and values, apple in. Thus, the principal aim of this paper is to explore the application of these three strategies cost strategy, differentiation strategy, and hybrid strategy in various business companies. Pdf apple inc strategic development report 2015 andrew. Jul 03, 2019 according to apple s 2010 annual report, global business strategy leverages its unique ability to design and develop its own operating systems, hardware, application software, and services to provide its customers new products and solutions with superior easeofuse, seamless integration, and innovative industrial design apple inc. This strategy has to do with differentiating the companys productservicing from competitors. How apple positions and differentiates their brand.
Brand positioning will help a the company to improve their marketing strategy and benefit to the company. A lowcost strategy is more likely, however, to generate increases in market share. We can describe apple s strategy in terms of product differentiation pt 1 and strategic alliances pt 2. This shows that product differentiation already exists in the market peter. Despite aggressive price cuts, apple saw its market share dramatically shrink. This saying captures the essence of a differentiation strategy. Apple s marketing strategy just one word can be used to describe the marketing strategy that apple has been using. The case is about the usbased technology giant apple inc. Apple s competitive advantage are its control of software, hardware, retail strategy, product differentiation and most important one is steve jobs strategically decision making. Pdf competitive differentiation through brand extensions in the. Apple the unique ability to maintain a low cost sourcing strategy while. On june 25, 1985, bill gates sent a memo to john sculley thenceo of apple and jeanlouis gassee thenproducts president. Apples premium pricing strategy, product differentiation. Apple designed computers for beginners which does not necessary have too many complex.
For example, ios was developed by apple is a different and unique operating system. Most executives think marketing is the sole source of differentiation. Conferencepaper analysisofdifferentiationstrategiesto. Businesses use the marketing strategy of product differentiation to distinguish their own products from those of their competitors. May 04, 2017 apple products are precisely standardized throughout international markets and suppliers across the world, which reduces costs and overhead there is little differentiation or customization. Apple has achieved what might be called quantum strategy a strategy that is. The niche markets that companies can target with this approach can be distinguished by sales channels, such as online, or by demographics, such as. Focused differentiation is a business level strategy that targets a specific market segment with a differentiated product that provides the unique characteristics that the market segment demands. Map policies prohibit resellers or dealers from advertising a manufacturers products below a certain minimum price. International business and organizational factors apple inc.
Through the help of this strategy, the organization has developed a strong market share in overseas market. Apple business strategy can be classified as product differentiation. An international strategy is a strategy through which the firm sells its goods and services outside its domestic market. Research does suggest that a differentiation strategy is more likely to generate higher profits than is a low cost strategy because differentiation creates a better entry barrier. Oct 30, 2018 apple s pricing strategy extends to its differentiation in the retail electronics marketplace. The issues identified after undergoing the research were price competition of apple and the sustainable development of apple. Apple is an american corporation that designs, manufactures and sells electronics, computer hardware and software, and personal computers. Strategy apple has achieved its outstanding performance through effectively implementing an unconventional strategy. Here are a few suggestions for how these tools could be used in your classroom.
Then, based on porters generic strategy, the second part is to evaluate apple s differentiation strategy. For small businesses, a product differentiation strategy may provide a. Differentiation strategy apple has successfully used the product differentiation strategy to separate their product in the market from other competitors. The report has identified apple inc strategy as a differentiation strategy. Apple inc uses differentiation strategy as its major international strategy to deliver high customer value through its innovative brands in overseas market. Products can be imitated at a lower cost structure than apple focuses on superior quality and innovation focuses on superior quality and innovation. To win deals at the prices you want, the strategy needed is differentiation.
Innovative strategic leader transformingfrom a lowcost. Apple has a history of shunning strategic alliances. In such a market, apple has been offering unique differentiation. While their macbook continues to be a success within the industry, apple wanted more and introduced the ipad which has become one of their top selling products of all time. From its macintosh home computers to the ipod music players and iphone and ipad mobile devices, apple has employed a differentiation strategy to target a section of the consumer market and send a.
Study the impact of chinas economic slowdown on apple s growth. This suggests that differentiation strategies can create competitive advantage in the never get old company brand denim business in the face of global markets. Examine apple s efforts to localize its offerings in china. Our project will focus on apple strategies and every type of strategy listed in this project. Apple has adopted and further developed a technique known in the academic world as local di. Apple uses a retail strategy called minimum advertised price or map. At last, the three parts will provide some suggestions for the implementation of apple s differentiation strategy. What is apples competitive advantage in its industry. Explore future strategies that apple can adopt to maintain its growth in the chinese smartphone market. Firms can gain various benefits from international strategies such as increased market size, greater returns on major capital investments in new products and processes, greater economies of scale, scope and a. Pdf a study of product differentiation strategy in mobile devices. Competitive advantages of apple inc the strategy watch.
Owning the consumergetting to the core of the apple business. In 2003, apple released the worlds fastest pc mac g5, which had dual 2. The technology industry is full of undifferentiated products. The wider strategic view is to layer service offerings in order to sell more hardware. The company is committed to bringing the best user experience to its customers. Apple also spent more money on its research and development. The company is well known for its innovative products such as macintosh line computers, the ipod. Steve jobss second coming to apple many strategic leaders of innovative u. The environment in which apple has been operating is characterized by consistent changes. Digital differentiation with screencasting pdf apple. Apple is a master of quantum strategy, which is both unconventional as well as extremely difficult to implement. Moreover, apple s primary business is selling hardware. This strategy failed as soon as pcs came out having similar capabilities as the macintosh and sold for a fraction of macintoshs retail price apple history, 2015. Pdf a study of product differentiation strategy in mobile.
For example, cocacola identified through market research that its diet coke brand also marketed as cocacola lite was regarded as girly. How apple uses differentiation strategy to gain competitiveness. I have chosen this company to describe differentiation generic strategy because apple company began using this strategy from the beginning hence gaining. This generic strategy focuses on key features that differentiate the company and its products from competitors. According to this, apple has created the list of strategies to overcome competitors kim, 2012. While users can purchase computers, tablets and mobile phones from nearly any electronics outlet, apple differentiates itself by providing limited quantities to big box retailers and focusing its retail efforts on its apple stores.
Specifically, the multinational technology company differentiates its products and services on the basis of simple, yet attractive design and advanced functionality. Through the broad differentiation generic strategy, apple stands out in the market. Apple created a very strong overall marketing strategy for the iphone an. Empathy is simply the ability to understand another individual, to be able to connect with them at a deeper level, get deep into their innermost desires and wants and provide them with a. Apple has done so, consistently, with all of its product offerings. Apple faced a huge loses at that time and went back into the shadow apple history, 2015. One example of differentiation strategy is apple inc businesses use. Preclass reading assignment how apples corporate strategy. This holiday season, apple will sell over 70 million iphones and millions more ipads, apple tvs, and mac computers. Evaluating apples services strategy ahead of the apple. Apple officially opened its first store in china in 2008, though prior to that apple products were sold at premium prices in the chinese grey market. The company is currently the market leader in smartphone subscribers with 43. A differentiation strategy creates brand loyalty which aids in creating barriers to entry protecting the industry and company from competition edwards, 2015 considerations if apple inc was a smaller company if apple inc were a smaller company the complexity of the organization would be lower and a simple structure maybe adopted with a flat hierarchy approach which would decentralization operations.
Apples iphone is without doubt the number 1 samsung 2 huawei. Apple expanded rapidly in the chinese market through flagship stores and distribution points in china. The study is also going to identify the issues that business has faced while carrying out their operations by undergoing external and internal analysis. Nov 20, 2020 apple uses a map minimum advertised price retail strategy.
A strategic analysis of apple plagiarism free assignment. The biggest challenge at the time was the release of apple s newgeneration operating system in response to the release of microsofts. Apple uses a map minimum advertised price retail strategy. For years, apple did a superb job of convincing buyers that there was no viable. This generic strategy focuses on key features that differentiate the company and its. A study on marketing strategy of apple products academic. Understand the issues and challenges faced by apple in its key growth market china.
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