Apple product strategy

09.04.2021 By Tetilar

Apple business strategy can be classified as product differentiation. Specifically, the multinational technology company differentiates its products and services on the basis of simple, yet attractive design and advanced functionality.

Apple Inc.’s Generic Strategy & Intensive Growth Strategies

Focus on design and functionality of products. According to its business strategy, Apple has adapted advanced features and capabilities of its products and services as bases of its competitive advantage. First mover advantage is another element of Apple competitive advantage. It has to be stated that Apple competitive advantage may be challenging to be sustained for long-term perspective.

Specifically, the management may fail in terms of ensuring the addition of innovative features and capabilities in new versions of its products, thus compromising its competitive advantage.

Strengthening Apple ecosystem. Apple business strategy can be characterised as vertical integration in a way that the company has advanced expertise in software, hardware, and services at the same time.

The company has been benefiting from its vertical integration immensely. Specifically, an important source of Apple competitive advantage relates to its ecosystem, which is enabled by such integration.

Apple devices and software sync easily and work well with each other.

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Applications work on multiple Apple devices at the same time and there is no much difference in user interfaces; however the same items do not pair with products of other companies, thus creating the likes of a closed ecosystem. The ecosystem also provides the opportunities to leverage relationships with existing customers to offer other products and services. Decreasing dependence of the business on the sales of iPhones. Apple business strategy is transitioning from relying on iPhone sales to prioritizing its services business and other divisions.

It is important to note that these and other efforts are showing positive results. Apple Inc Report contains a full analysis of Apple business strategy. Moreover, the report contains analyses of Apple leadership, organizational structure and organizational culture. The report also comprises discussions of Apple marketing strategy, ecosystem and addresses issues of corporate social responsibility. Main menu Skip to primary content.

Skip to secondary content. Join Our Newsletter.When we talk about Apple, what usually comes to mind is its product line, which has become equated with high quality, invention and innovation. Preorders come rolling in even months before the release of a new product, and customers barely even blink when it comes with a steep price tag attached. Why, you ask? Because it is an Apple product, which means that it is not something to take lightly.

But what this really means is that Apple has a solid product strategy in place, and it is actually working. When it comes to consumer electronics and computing technology, one of the most recognizable names in the world is Apple. In a surveyit was adjudged as the most valuable brand in the world, valued at close to USD billion. Originally named Apple Computer Inc.

The entrance of other players in the consumer electronics market meant that Apple is getting stiffer competition, especially since these competitors are churning out smartphones and tablets that are significantly lower in price.

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There is no denying, however, that the best product strategy that Apple employs is coming up with very good products. By continuing to hold on to high standards of qualityApple refuses to get on the bandwagon that most other device makers are using, where they pack their products chock-full of features that, while they may be impressively advanced, actually end up making operating the device actually more complicated and not at all user-friendly.

Packaging is certainly not an area where Apple is lacking. It is known for being a company that provides clean and simple, yet functional packaging to its products. More than being flashy, it tends to boast more of a utilitarian aesthetic, but without coming across as boring or plain.

This means that it focuses on selected products and continues enhancing them, instead of branching out to create other products within the same category. If you look at the numbers, it is true that other companies, such as Samsung, are showing higher figures when it comes to unit sales.

They are starting to occupy a larger share of the market. But this does not worry Apple. Instead, it continues to focus on its loyal customers and, despite occupying a smaller percentage of the market, is able to position itself as a premium brand and a maker and provider of top quality products.

As such, Samsung was able to eat up a huge chunk of the market because of its production of cheap and low-end gadgets.

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That market is not really what Apple is aiming for, and it is comfortable with the market it has right now. Market trends are constantly changing, and demands are certainly increasing.

This explains the product refreshes and updates that are released on a schedule set by Apple. Clearly, this means that the latest iPhone, the iPhone 6 Plus, is a much improved version of the first generation iPhone, or even the previously released iPhone 6. These changes put the Apple product development team in a good light, particularly in the eyes of Apple users, since it implies a commitment on their part of seeking continuous improvement for their product offerings.

It also effectively attracts new users, thereby increasing the market share of Apple. Having total control means that Apple users are guaranteed to have the latest version of the operating system, with updates readily and immediately made available to Apple users.

The strategy employed by Apple in its product development largely depends on what the product is. Compared to when Apple was founded and started its operations, there are now a lot more consumer electronics companies and mobile phone manufacturers that are attempting to compete with Apple.

However, out of this sea of competitors, there are only a few companies that are considered to be major threats or those that provide serious competition. Granted, some of these companies do not really pose a serious threat to Apple, not like Samsung and Google.Immediately after college dropouts Steve Jobs and Steve Wozniak founded Apple in Aprilthe duo initially sold some circuit boards that they produced inside an unused garage.

They subsequently introduced the 8-bit fully functional home computer Apple II in and it eventually became one of the first highly successful commercially produced microcomputers in the market.

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But the company did not rest alone with designing and manufacturing computers. Apple expanded its product portfolio and successfully emerged as an innovative and influential multinational technology company. The introduction of iPod in and the online music and app store iTunes have revolutionised the music industry through the promotion of digital music. These two products created and supported an emerging ecosystem for selling and purchasing music via the Internet. The company was also instrumental for ushering in the era of smartphones and tablet computers with the introduction of iPhone in and iPad in These two consumer electronic devices have reimagined the way manufacturers develop and produce mobile devices.

After all, this prudently and intricately crafted strategy has played a critical role in hurling its brand and products toward an unprecedented level of popularity and approval. The competition was tough and Apple was at the losing end. The company struggled with maintaining sales and it finally succumbed to defeat as Windows-based personal computers from Microsoft gained a stronghold in the market.

The poor performance of Apple stemmed from its poor product strategy. Apparently, the company was producing and selling an array of computer products that were redundant and confusing. When Jobs returned in to lead the company, his first order of business was to discard all unprofitable products and realign the product strategy based on the concept of simplicity and premium user experience. Today, product strategy is at the core of the marketing strategy of Apple.

One of the reasons why these products have become successful is that they are user friendly and highly intuitive compared with their competitors. They are also unassuming because of their simple and uniform built and design. Of course, despite this simplicity, these products provide a premium user experience through innovative features and design considerations. It is important to remember that these products were not original.

There were already ultrathin laptops long before Apple introduced the MacBook Air.

Learning This 1 Thing Helped Me Understand Apple's Strategy

Portable media devices had existed prior to the popularity of iPod. Moreover, there was already a market for smartphones and personal digital assistants before the iPhone and iPad revolutionised mobile computing and the consumer electronics industry. However, these products have outcompeted their predecessors and some of their counterparts because they provided an innovative and unique overall product usability and consumer experience.A few years before Sony co-founder Akio Morita passed away, I had a chance to interview him about his decision to buy a movie studio.

But for Apple, hardware is simply a vehicle for delivering its other creations, like user interfaces, apps and services the lattermost of which is an important source of growth for the company. Taken together, these components power a rich cross-platform experience that allow Apple users to keep their myriad devices in sync and up-to-date.

He turned it off, put it on the table and asked me what I saw. I replied that it was a block of metal with a glass screen. His reply? I remember the conversation well, because it has shaped my understanding of the company ever since. As Apple sees it, the iPhone is a blank canvas on which it can paint. The Android world in particular suffers from terrible bifurcation, exacerbated by the myriad hardware and software versions available.

We all know how Apple disrupted the PC market with the Mac, introducing the graphical user interface and mouse to a wide audience for the first time.

We also know how it disrupted the music industry with the iPod, and the communications world with the iPhone. The iPad, meanwhile, set off further disruption of the PC world. All of that hardware had one thing in common: Powerful hardware, yes, but more importantly, a user interface, apps and services that people loved, or still love. Sales aside, the device also helped Apple make progress on its longtime quest to reinvent television.

Jobs probably envisioned an actual television set, and rumors of Apple making one never seem to die. As my friend Benedict Evans of venture capital firm Andreesen Horwitz recently tweeted:. Tim Bajarin is recognized as one of the leading industry consultants, analysts and futurists, covering the field of personal computers and consumer technology.

Bajarin is the President of Creative Strategies, Inc and has been with the company since where he has served as a consultant providing analysis to most of the leading hardware and software vendors in the industry.

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The marketing strategy of Apple: A concise analysis

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apple product strategy

You can unsubscribe at any time. By signing up you are agreeing to our Terms of Use and Privacy Policy.Apple had been following a product strategy that can be thought of as a pull system.

The company was most aggressive with the products capable of making technology more relevant and personal. One way of conceptualizing this product strategy is to think of every major Apple product category being attached to a rope.

The order in which these products were attached to the rope was determined by the degree to which technology was made more personal via new workflows and processes for getting work done. Accordingly, Apple Watch and iPhone were located on the end of the rope held by Apple management.

Meanwhile, Mac desktops were located at the other end of the rope while iPads and Mac portables were somewhere in the middle. As Apple management pulled on the rope, the Apple Watch and iPhone received much of the attention while the Mac increasingly resembled dead weight.

The following exhibit does a better job of demonstrating the chaos found at the end of the rope. Consider the following announcements:.

What Is Product Strategy (an overview)

Features like multitasking and Apple Pencil support give iPad differentiation from its more popular sibling iPhone. The new Mac Pro is clear evidence of Apple industrial design, along with the engineering and product design teams, attempting to come up with a long-term solution for the most powerful computer in the product line. SwiftUI is the kind of foundation Apple needs to properly leverage a thriving iOS developer ecosystem in order to benefit other product categories.

Apple no longer appears to be relying so much on a pull system when it comes to advancing its product line. Instead, a push system is being utilized, and every major product category is being pushed forward simultaneously. Accordingly, the primary benefactors arising from this new strategy are the iPad and Mac.

Apple was able to move its entire product category forward at the same time. This revised strategy ends up supporting a core tenet of my Grand Unified Theory of Apple Products - a product category's design is tied to the role it is meant to play relative to other Apple products. By pushing the products geared towards handling the most demanding workflows, Apple has a greater incentive to push the products capable of making technology more personal and relevant.

Some products will receive updates every few years while others require more attention due to needing annual updates. Instead, the change from a pull to push system manifests itself with each product category being given a defined and unique role to handle within the Apple ecosystem.

Wearables are tasked with handling entirely new workflows in addition to a growing number of workflows that had been given to iPhones and iPads. The iPhone is the most powerful camera and video player in our lives. Mac Desktops. Despite being in the post-PC era, desktops are experiencing some kind of renaissance.

Mac desktops are niche in terms of the number of users relative to other Apple product categories, albeit a very powerful and crucial niche. Mac Portables. A few years ago, low-end Mac portables seemed to be on a dead-end path thanks to iPads. An ARM-based Mac portable seems inevitable at this point. Just a few years ago, some in the tech pundit world thought the iPad lacked a future.Businesses use the marketing strategy of product differentiation to distinguish their own products from those of their competitors.

Since the s, Apple Inc. 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 powerful message that its products stand out from the crowd.

A major aspect of a product differentiation strategy comes from product design. Products that display a different visual style, include different features or handle different tasks stand out from those offered by the competition. Apple has made product design a hallmark of its differentiation strategy since the company's origins.

When Apple introduced the iPod, iPhone, and iPad, there were no similar consumer electronics products that included so many features in one distinctive, iconic package. Another factor in product differentiation plans stems from the company's pricing strategies. Apple Computers co-founder Steve Jobs sought to create a top-notch product with a price proportionate to its level of quality while maintaining high profit margins. The lowest-priced Apple products consistently fall in the mid-range, but customers are willing to pay that price for the high quality of the user experience.

This pricing strategy runs counter to makers of commodity laptops, tablets and mobile phones, which sell lower-cost devices and rely on high volumes to counter their slim profit margins.

The relatively higher cost of the Apple versions gives consumers a sense of high value and exclusivity for their products. Apple's pricing strategy extends to its differentiation in the retail electronics marketplace. 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.

For its third-party retailers, Apple imposes a minimum advertised price policy to prevent outlets like Walmart and Best Buy from undercutting the prices found at the Apple Stores. Apple has been among the most successful technology companies in the development of loyalty to a brand.

Loyal Apple customers will wait in line to purchase the latest iPhone, download music through iTunes, watch their favorite television shows on Apple TV and play games on their iPads. The company's efforts toward building brand loyalty have allowed Apple to differentiate itself from Microsoft, Samsung and other competitors in its various arenas.

The concept of brand differentiation has allowed Apple to create a virtual split in the world of electronic devices: Apple devices vs. It has created a vision of exclusivity that gives Apple a leg up in the market, helping them to keep their products at the top of countless must-have lists every year.

Living in Houston, Gerald Hanks has been a writer since He has contributed to several special-interest national publications. Before starting his writing career, Gerald was a web programmer and database developer for 12 years. Share It. About the Author.Apple Inc. Michael E. With a high rate of innovation and emphasis on excellence in product design, the enterprise succeeds even with its relatively high selling prices. This alignment between the generic competitive strategy and the intensive growth strategies provide support for fulfilling Apple Inc.

This generic strategy focuses on key features that differentiate the company and its information technology products from competitors. Through the broad differentiation generic strategy, Apple stands out in the market. For example, elegant design and user-friendliness of products, combined with high-end branding, effectively differentiate the technology business. This generic strategy means that Apple always aims to set itself apart from competitors not by price but by competitive advantages based on product design that attracts customers.

Such design includes seamless connectivity among devices and cutting-edge aesthetics.

apple product strategy

Even though this generic strategy makes Apple different, the company still broadly reaches various segments of the market. For example, Apple targets individuals and business organizations through the MacBook product line. In this way, the generic strategy of broad differentiation supports the company in maintaining its competitive advantage, leadership, and position as a high-end and high-value technology business.

For example, to apply this strategy, the company must continue emphasizing innovation through research and development. Apple must keep developing innovative products so that the business maintains its competitive advantage.

Competitors eventually catch up with new technologies and new products, so the broad differentiation generic strategy compels the company to continuously innovate to keep itself always ahead of the competition.

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In addition, to maintain business growth, the company must keep growing its market reach, such as in the global consumer electronics market. In its generic strategy for competitive advantage, Apple does not focus on any specific market segment. Instead, the company competes by selling various goods and services that suit the various segments of the consumer electronics and information technology services industries.

Such expansion and business growth are achieved through intensive strategies for growth. Product Development. Apple uses product development as its main intensive strategy for growth. Product development requires that the company develop attractive and profitable technology products to grow its market share and business performance.

Apple implements this intensive growth strategy through innovation in its research and development processes. Through product development, the company uses innovation as a critical success factor and competitive advantage.

For example, the business continues to innovate products like the iPhone, iPad, and Apple Watch.

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In this intensive growth strategy, the company grows because new products allow the business to generate more revenues, such as through the sale of new iPhone models. Also, Apple Inc. Market Penetration. For example, Apple applies this growth strategy by selling more iPhones and iPads to its current markets in North America. Also, the company achieves more sales by adding more authorized sellers to boost competitive advantages in its current markets. This approach penetrates markets where Apple has not yet achieved a significant position.

apple product strategy

In relation, under the market penetration intensive growth strategy, the company uses promotion through various websites and media outlets.