The document presents a strategic analysis of Apple Inc. as of October 2015, detailing its history, industry position, competitive landscape, and financial performance. It highlights Apple's strengths in innovation and brand reputation, outlines its broad differentiation strategy, and identifies key competitors and market opportunities. The financial outlook shows significant revenue growth, reinforcing Apple's status as a leading technology provider focused on high-quality products.

1. Strategic Analysis of AppleInc.
October 2015

2. •Introduction to Apple Inc
•Industry Definition
•SWOT Analysis
•Key resources
•Products and Services
•Main competitors of Apple
•Competitive Advantage
•Generic Strategy Followed by Apple
•Financial Situation
•Conclusion
Content

3. Introduction To Apple
Inc

4. Presentation
 Apple Inc. (Apple) is US technology company of 92,
600 employees, with retail stores in 16 countries and
online stores in 39 countries. From its headquarters
at Cupertino, California (USA), Apple is serving four
industries worldwide: computer hard ware,
computer software, consumer electrics and digital
distribution. The current CEO is Timothy COOK (54
years old, since 2011).
 Apple sales last year: $182.795 billion (2014)
 Apple net income last year: $39.510 billion (2014).

5. History
 1976 With $1,300, Steve Jobs and Steve Wozniak
found Apple Computer, Inc.
 1982 Apple becomes the first personal computer
company to reach $1 billion in annual sales.
 1985 John Sculley assumes the helm after a
management shakeup that causes the departure
of Jobs and several other Apple executives.
 1996 Acquisition of NeXT brings Steve Jobs back to
Apple as a special advisor.
 1997 Steve Jobs is named interim chief executive
officer.
 2000 Jobs, firmly in command as CEO, oversees a
leaner, more tightly focused Apple.
 2001 The iPod is released; Apple opens its first retail
store in Virginia.

6.  2007 Launch of iPhone (1st generation) and Apple TV
and Launch of the App Store next year.
 5 October 2011 Death of Steve Jobs.
 2013 Apple recruits Angela Ahrendts, CEO of the
luxury brand Burberry, and Paul Deneve, CEO of Yves
Saint Laurent.
 2014 Apple purchased Beats for $3 billion, a
company that makes high-priced headphones as
well as a streaming music service.
 2015 Apple released the Apple Watch line, which
ranges from $350 for the entry-level Sport model to
$17,000 for the most expensive Apple Watch Edition.

7.  Vision Statement
 “We believe that we are on the face of the earth to
make great products and that’s not changing. We are
constantly focusing on innovating. We believe in the
simple not the complex. We believe that we need to
own and control the primary technologies behind the
products that we make, and participate only in
markets where we can make a significant
contribution.’’
Mission statement
 “Apple designs Macs, the best personal computers in
the world, along with OS X, iLife, iWork and professional
software. Apple leads the digital music revolution with
its iPods and iTunes online store. Apple has reinvented
the mobile phone with its revolutionary iPhone and
App store, and is defining the future of mobile media
and computing devices with iPad.”

8. Main long term objectives
 The broad differentiation generic strategy has
significant implications on Apple’s strategic
objectives. So to effectively apply this generic
strategy Apple has:
 1- To lead the technology market by continuing to
emphasize innovation through research and
development and continually developing
innovative products so that the firm always stands
out against competitors.
 2- To ensure that it keeps expanding its market
reach, competing in all market segments with other
players in the industry, through intensive strategies
for growth (Product Development, Market
Penetration, Market Development).

9. Industry Definition

10.  In general Apple Inc. is operating in the technology
industry. Within this big market, there are more
specific sub industries where the company focus its
development. These sub industries are:
Computer software
Consumer electronics
Digital distribution
Mobile payement
Computer hardware

11. Industry Analysis (5
Porter’s 5 Forces model)
Competitive
Rivalry or
Competition with
Apple
- High aggressiveness of firms (strong force)
- Low switching cost (strong force)
Strong
Force
Bargaining Power
of Apple’s
Customers/Buyers
Bargaining Power
of Apple’s
Suppliers
Threat of
Substitutes or
Substitution
Threat of New
Entrants or New
Entry
- Low switching cost (strong force)
- Small size of individual buyers (weak force)
Strong
Force
Moder
ate
Force
- High number of suppliers (weak force)
- High overall supply (weak force)
- High availability of substitutes (moderate
force)
- Low performance of substitutes (weak
force)
- High capital requirements (weak force)
- High cost of brand development (w f)
- Capacity of potential new entrants (strong
force)
Wea
k
Forc
e
Wea
k
Forc
e
THE INDUSTRY IS ATTRACTIVE
Suitable
STRATEGY
Formulation
Modera
te
Force

12. SWOT Analysis

13. I
n
t
e
r
n
a
l
E
x
t
e
r
n
a
l
Weaknesses
- Limited distribution network
- High selling prices
-Sales limited mainly to high-
end market
Apple’s pricing and
distribution strategies impose
limitations in its business.
Strengths
- Strong brand image
- High profit margins
-Effective innovation process
The company’s strengths are
difficult to compete with.
Threats
- Aggressive competition
- Imitation
-Rising labor cost in countries
where Apple plants are
located
Apple must take appropriate
action to prevent or
overcome these threats.
Opportuniti
es
- Distribution network
expansion
- Rising demand for tablets
and smartphones
-Creation of new product
lines
Major opportunities for growth

14. Key resources

15. Resources
 Apple has a long history of innovation and tenacity in
the technology market in the face of stiff competition.
 The excellent Apple brand reputation and the quality of
the products of Apple are in high repute.
 Apple operates over 255 company controlled retail
stores across the US and 424 worldwide, most of which
were located in high-traffic locations such as shopping
malls and urban shopping district.
 Human resource: Apple has an efficient management
team and Steve Jobs has been the superexcellent
leader of this team.
 Most of the apple’s manufacturing, assembly work,
logistics and transportation planning was outsourced,
resulting in great efficiency and lower costs.
 The excellent Apple brand reputation and the quality of
the products of Apple are in high repute.

16. Capabilities
 An important marketing capability of Apple is its
brand power. With super eminent customer-
focused services strategy as well as the aggressive
advertising strategy, excellent reputation, goodwill
and image have been built up among the
consumers.
 The technological function of Apple stand with the
latest and pioneer technology.
 Apple implements a hybrid strategy which
integrates the cost leadership and differentiation
strategy.
 The firm has a direct sale model used through
internet, telephone, and company controlled retail
stores.
 It’s built a well-managed and integrated supply
chain.

17. Products & Services

18. Products
 Apple TV
 Headphones
 Mac
 iPod
 iPhone
 iPad

19. Services
 iCloud
 Mac App Store
 Apple Store

 Apple Pay
 iOS App Store

 iTunes Store
 iBooks

20. Value proposition
 Apple has positioned itself to a certain type of
customer, wealthy people, innovators, people
with good jobs, good lifestyle, etc. If Apple
targets the poor, the trendy guys will stop
buying Apple. This would hurt the brand more
than the increasing sales because of lower
prices, and in good times, where everybody
has more money.
 On the other hand, there are no really
substitution products, there are no similar
machines that we can buy to have the same
user experience. PCs are the same
competition to Apple as Ford is to Mercedes.
PCs are the everyday workhorse for the
masses; Apple is elegance, difference and
privilege for the minority.

21. Main Competitors

22. Paypal in Mobile Payments
•Simplicity, modest commission
•Viral marketing, expanding to accept payment via mobile
text
Samsung in Smartphone market
•The 2nd largest amount spent for R&D in the world, in 2014.
Microsoft in Computer Softwares
•Brand loyalty & reputation, easy to use software
•Strong distribution channels, robust financial performance,
acquisition of Skype
Hewlett Packard in Personal Computers
•The world’s leading PC vendor with more than 15% market
share.
•Positioned in the chinese growing market.
Google in Entertainment Media & Distribution
• Brand loyalty & reputation, easy to use software
•Strong distribution channels, robust financial performance,
acquisition of Skype

23. Generic Strategy

25. Apple’s Generic Strategy
(Porter’s Model)
 Apple’s generic strategy is broad
differentiation. This generic strategy focuses on
key features that differentiate the company
and its products from competitors. Through the
broad differentiation generic strategy, Apple
stands out in the market. For example,
emphasis on elegant design combined user-
friendliness and high-end branding effectively
differentiate the company.
 The broad differentiation generic strategy
means that Apple always aims to set itself
apart from competitors not by price but by
other key features beneficial to customers.

26. Financial Situation

27. Revenue
 2015: Annual Revenue Forecasts $ 233.2 billion
 2014: Annual Revenue $ 182.8 billion
 2013: Annual Revenue $ 170.9 billion
Net Income
 2015: Annual Profit Forecasts$ 70.8 billion
 2014: Annual Profit $ 39.5 billion
 2013: Annual Profit $ 37.0 billion
Stock Performance
 Dec 1980: stock price $ 22.0
 Oct 2015: stock price $ 111.6 (x 56 due to stock splits)
 $5 000 invested in 1980 = $ 1 635 227 in oct 2015.

30. Conclusion

31.  With growing demand for high-quality, powerful,
user-friendly, and cost effective products, Apple is
undoubtedly the leader in terms of bringing these
ideas to life, with outstanding value innovations.
 The company realizes that rather than publicly
announcing product development plans years in
advance, products are better-received with an
“awe” response if they are simply released when
they’re finished. This is an excellent strategy when
the goal is to keep consumers eager for the latest
products and asking:

32. “What could they possibly
improve next ?”

33. Thank You 