As Apple surpassed all major competitors and had spectacular success in 2010, it left CEO Steve Jobs wondering if there was anything that could overturn the drive. “Apple Inc. in 2010”, is an evaluation case. This case will be further discussed using the state-and-prove order using the following five elements: 1. Bottom-line evaluation (position statement)
2. Evaluation criteria
3. Proof of the evaluation
5. Action plan
Apple’s hits have been executed through first mover advantages, technological advances, and innovative strategies. Based on Apple’s current product positions, their success can continue into the next decade; however, it will be much harder for Apple to maintain their innovative momentum considering product substitutes and increasing competitive pressures. Evaluation Criteria
Apple can be evaluated in many different ways given the numerous technological markets it has pursued. They can be broken up into the following product categories: computers, mP3s, and smart phones. Since each of these product categories have their own significant impact on Apple overall, it would be wise to evaluate items such as market shares, gross margins, and unit sales within each group. These can be measured by taking a look at past years, where they stand currently, and projections a few years in the future. By doing so, it will indicate Apple’s strengths as well as weaknesses within the company. Proof of the Evaluation
Despite Apple creating the first revolutionary “personal” computing devices, IBM was the one to bring PCs into the mainstream in the 1980s, says Yoffie and Kim (2010). There were plenty of manufacturers in this industry and the reason for growth was driven by lower prices and expanding capabilities. Apple has never seen more than 4.2% market share in the worldwide PC industry, whereas competitors in the big four – Hewlett-Packard, Dell, Acer, and Lenovo –had market share’s as high as 20.3%. The sole advantage Apple has is that they have control over both hardware and software in comparison to competitors who rely on firms such as Intel and Microsoft.
Unfortunately, it doesn’t look like the PCs are very sustainable. Since they have been around since the 1980s, by now PCs are being viewed as old technology. The availability of the technology needed to create PCs is readily accessible which makes the barriers to entry very low. This simply means that it is extremely easy to produce a personal computer and for those customers who need one for the basic functions, this would be the option they would use. In fact, the “white box” computers, which are the generic computers make up 33% of the market. It is also priced at a very low competitive price which creates high rivalry because due to the phasing out of PCs, for anyone who needs to purchase one they will opt to buy the cheapest computer. Additionally, there are plenty of substitutes in this day and age. Almost all smart phones have the capabilities that computers have plus many more, so what is the need for them?
For Apple to maintain even a little bit of market share, an opportunity for this industry would be to focus on the education buyer category. If schools across the country
would use Macs from when children are in elementary schools until high school, they will most likely make a purchase of their own when it comes time for college. Having these products available for consumers while they are young and have them able to grow up with Apple, this will create high brand loyalty. This will most likely influence their
purchasing decisions when it comes time to obtain laptops for college or for home use, which is very important since the home consumers represent the biggest segment which account for half of PC shipments worldwide (Yoffie & Kim, 2010). iPods
Apple debuted their first of many iPods in 2001. At this time, there were many...
References: Yoffie, David B., & Kim, Renee (2010). Clayton Apple Inc. in 2010. Harvard Business Publishing, Volume 1, 21 pages.
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