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Individual project wiley

  1. 1. 1 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 Apple is a high end electronics retailer that has built itself up as the retailer to beat. From its innovative products to its high quality customer service, Apple has upheld is reputation and rarely fails to deliver. SWOT Analysis Apple’s Strengths are extensive. First of all, Apple has created many innovative products from the IPod, the IPhone, and the IPad. It has generated a hugely recognized brand name, while also bringing in loyal customers. Apple consistently comes out with new products, always better than the last. Contributing to education is important to Apple, where they have a strong presence in donating and providing products to schools. On top of everything, Apple’s late CEO, Steve Jobs, was highly respected. The Weaknesses of Apple are their high prices, the fact that they constantly come out with new products before their consumers can get used to the old ones, failure of some new products, bugs that come up in their products, and the “decision to restrict the IPhone to a single operator in several markets around the world” (Mishra). Apple’s opportunities include good relationships with vendors they partner with to bring out new products, consistent new opportunities in terms of the PC and mobile industries, international expansion, increasing demand for apple products and their services, and finally the growth of environmental efficient products. Apple’s threats include competition from other PC and Mobile industry companies that are selling products that rival Apple’s products (sometimes with better prices), the death of Steve Jobs, the many products that are available to substitute for Apple’s products, and the “incompatibility with the windows platform” which most PCs use (Mishra).
  2. 2. 2 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 Target Customer Profiles and Strategies Apple has a unique target market strategy, which is to not have a target market at all. Apple does not necessarily target specific markets, but “it targets people” and “focuses on users” (Halen, 2010). Apple wants their consumers to decide what to do with their products, and therefore they target the people within different markets rather than the markets themselves (Halen, 2010). However, if Apple had to specify a target market, it would probably consist of people who use their computers from home, small businesses, young users, and creative users. Apple products are available for consumers to try out and sample in their very technologically advanced store, allowing all different kinds of consumers to see Apple products in action (Mishra). Location Strategies Apple has positioned themselves as a global enterprise through opening up new stores all over the world. Beginning this year, Apple has opened 361 stores worldwide, mainly located in shopping malls and as flagship stand alone stores in big cities, such as London and New York City (Apple Press Info, 2011). In recent years, Apple has begun to focus on opening new stores overseas and expanding their customer base (LaVallee, 2009). Pricing Strategies Apple’s pricing strategies have become increasingly more competitive since they first began in the 1990’s “when consumers regarded Apple as a producer of overpriced tech baubles” rather than the innovative technological connoisseur they are today (Wingfield, 2011). Apple
  3. 3. 3 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 has brought their prices down in order to effectively compete with Macintosh, Asus, and Acer, as well as other companies. Competition that tries to undercut Apple’s prices with very similar products are normally not able to make a large difference, some of which even charge higher prices for their similar products. This makes Apple even more successful. The difference between Apple and their competition is that in order to get an Apple product the day it comes out a consumer would have to stand in line, whereas for the other products there will not be a line, but often charge higher prices. Current Problems Steve jobs once said at a conference that he thinks “Apple does one of the best jobs of any companies in our industry, and maybe in any industry, of understanding the working conditions in our supply chain” while two former employees stated that “Apple never cared about anything other than increasing product quality and decreasing production cost” and that Apple has “known about labor abuses in some factories for four years, and they’re still going on” (Duhigg & Barboza, 2012). One of Apple’s problems involves unethical working conditions in the factories of their suppliers. Workers in a factory producing IPhones, IPads, and IPods were even ordered to use a poisonous chemical to clean IPhone screens, leaving 137 workers in need of medical treatment. Shortly thereafter, 2 explosions occurred, killing 4 people and injuring 77. Apple has attempted to make minimal efforts to create safer working conditions for the workers creating their products, but is torn with maintaining good supplier relationships and still receiving
  4. 4. 4 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 products as fast as possible, which many employees, some underage, work severe overtime 7 days a week in order to accomplish. Apple claims that as soon as they find out about indiscretions in their suppliers they order the situation to be remedied and terminate the suppliers who refuse, but this is also a challenge for them to do because it is difficult and expensive to find new suppliers (Duhigg & Barboza, 2012). SuggestedAlternatives One solution to Apple’s problem would be for them to admit that there is a problem and actually put in the effort to witness the working conditions for themselves and make them better. Apple could follow its promise to dismiss any supplier who refuses to meet ethical standards and work on finding suppliers who believe in ethical working conditions. They could use their new ethical standards to create a better reputation and improve their brand image, which would in the end possibly attract new consumers or create a new found loyalty in existing consumers. Solution number two involves reassessing their sourcing strategy, and possibly taking their sourcing to other countries. For instance, “India is the leading recipient of the outsourcing of information technology functions like software development and maintenance” (DiCarlo, 2003). This could be a great opportunity for Apple to find a new country to source from and create a clean slate to form a new ethical sourcing strategy from a country that is known for producing technology. Recommendations
  5. 5. 5 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 My recommendation is for Apple to own up to its unethical sourcing standards and to put effort into creating a safer and healthier work environment for the people that create their products and help their company run so successfully. This solution can help to build Apple’s reputation and increase the brand loyalty of their consumers. Apple is overall a very successful company that produces great, popular products at a decent price while still out performing their competition. If they can create better working conditions from ethically responsible suppliers they can create a better brand and product for the people they cater to.
  6. 6. 6 Apple Emily Wiley Retailing Marketing MKTG 4600 Section 007, 777 Spring 2012 Bibliography ApplePress Info.(2011, December11).RetrievedfromApple Store GrandCentral OpensFriday, December9: Friday-December-9.html DiCarlo,L. (2003, August27). Duhigg, C.,& Barboza, D. (2012, January25). The New York Times.RetrievedfromInChina,HumanCosts are BuiltIntoan IPad: and-the-human-costs-for-workers-in-china.html?pagewanted=all Halen,J.W. (2010, August27). Managing Experience.RetrievedfromAppleDoesn'tTargetMarkets.It TargetsPeople.: markets-it-targets%C2%A0people/ LaVallee,A.(2009, November12). The Wall Street Journal.RetrievedfromApple’s‘SignificantStore’ Strategy: Mishra,D. (n.d.). Slideshare.RetrievedfromAppleInc.ExecutiveSummary: Wingfield,N.(2011, October29). CNBC.RetrievedfromApple’sLowerPricesAre All Partof the Plan: