Assignment-1

1/30/2023
BUSINESS ECONOMICS

Srirag_s
21BAF043
Brief History of Apple Inc
Our Apple case study starts with 𝘁𝗵𝗲 𝗱𝗮𝘆 𝗦𝘁𝗲𝘃𝗲 𝗝𝗼𝗯𝘀 𝗿𝗲𝘁𝘂𝗿𝗻𝗲𝗱 𝘁𝗼 𝗔𝗽𝗽𝗹𝗲 𝘄𝗮𝘀
𝘁𝗵𝗲 𝘀𝘁𝗮𝗿𝘁𝗶𝗻𝗴 𝗽𝗼𝗶𝗻𝘁 𝘁𝗵𝗮𝘁 𝘁𝗿𝗮𝗻𝘀𝗳𝗼𝗿𝗺𝗲𝗱 𝗔𝗽𝗽𝗹𝗲 𝗶𝗻𝘁𝗼 𝗼𝗻𝗲 𝗼𝗳 𝘁𝗼𝗱𝗮𝘆’𝘀 𝗺𝗼𝘀𝘁 𝗮𝗱𝗺𝗶𝗿𝗲𝗱
𝗯𝗿𝗮𝗻𝗱. Steve Jobs recognized that consumers were frustrated by how all the
other technology brands designed their products in a lab without any thought
for the consumer. Steve Jobs made the most significant contribution to the
Apple brand strategy in how he starts with the consumer experience and then
work back to the technology. 

The Apple brand strategy that we see today builds everything around the
brand idea of “Apple makes technology so simple that everyone can be part of
the future.” Then, we witnessed the most incredible decade that any company
has ever seen, with Apple launching iTunes, iPod, iMac, the MacBook Pro,
MacBook Air, iPhone, and the iPad.

Apple Computer Company was founded by Steve Jobs and Steve Woziniak in
1976 after they had dropped out of school. They were working in a family
garage in California where they decided to come up with a computer circuit
board which they called Apple 1. They made more than two hundred units
within a few months after starting.

In order to boost their new business, they decided to incorporate a new

partner who was more experienced for them to attract venture capital. The aim
of these two entrepreneurs was to introduce into the market a computer that
was easy to use and they came up with Apple II in 1978. There endeavors led
to a complete revolution in the PC industry raising the sales to 1$ billion in
less than three years.

The company became

one of the most
successful dealers in
computers with high sales until they launched their IPO in 1980. However, the
company started experiencing problems with its sales falling in the recent
years. This problem is compounded by the entry of other players in the PC
market such as windows 7 which started pushing Apple further (Yoffie and
Kim 2). This essay will discuss some of the problems Apple has been facing
and how they could possibly be solved.

Apple Marketing Problems

One of the most serious problems that apple Inc is facing and which to a large
extent contributes to the occasional failures of the company is a marketing
problem due to stiff competition in the industry. Initially, Apple was dealing
with Macintosh computers when it started facing stiff competition from other
PC manufacturers such as IBM. Later on, Apple decided to shift from PC
industry into mobile phone industry.

The company wanted to go beyond Macintosh computers and embrace a

digital hub strategy. This shift was marked by the introduction of iPod in 2001
and the iPhone in 2007.
Later in 2010, the company
introduced the iPad. After
these developments the
company changed its name
from Apple computers to
Apple Inc. one of the
distinguishing features of
Apple Inc iPods is the
iTunes software that they incorporated (Yoffie and Kim 9).

Despite the success of the iTunes Apple Inc has enjoyed, it has had strained
relationships with content companies. These companies are in strong
opposition of the fact that Apple Inc has dominated the digital music market
and its structure of fixed prices.

In addition, music labels are seeing the threat posed by Apple Inc because
there high priced CDs are being faced out of the market. Apple Inc faces
strong competition from online music stores such as Napster, amazon.com
and Walmart.com which often inconveniences the marketing strategies of
company.

These online music stores have been offering music downloads at discounted
prices. Some music labels have been allowing music stores to sell DRM free
music. For example, MySpace which is a social network has been networking
with other music labels to come up with its own music service. This increases
the competition hence forcing Apple Inc to start looking for new marketing
strategies in order to remain relevant in the market.

In addition to the music services provided by social networks which pose a

threat to Apple Inc, the company has also experienced another challenge
coming from internet radio sites such as last.fm and Pandora which offer free
streaming services. Other companies like Nokia started offering music
services with their phones.

The impact of this

competition is that it forces
Apple Inc to diversify its
marketing strategies and
look for new products which
is costly for the company. For instance, in response to these threats the
company had to buy Lala.com which is a music streaming service in 2009.
This raised speculations from the competitors that Apple Inc had intentions of
coming up with a new model of storing digital music.
The entry into mobile phone industry
for Apple is a risky endeavor
because there are strong
competitors with remarkable
experience in the industry. The
products also have a short life span and sophistication in technology of which
apple Inc has little experience in. there is also a strong challenge in
distribution since some of the distributors already in the market such as
Vodafone are formidable. This makes the marketing strategies for Apple Inc
challenging (Yoffie and Kim 9)

Proposed Solution for the problems

The marketing problem facing Apple Inc as result of increased competition

can be handled through intensive market research and analysis. Apple Inc
should be very keen on identifying the strategies and moves being used by its
rivals. Apart from observing the rivals, the company should conduct continued
market research and identify what the customers require in order to satisfy
them.

Through proper knowledge of what the customers need and the strategies
being used by the competitors, the company will be able to apply the requisite
innovativeness in coming
bringing into the market
new products. The
company should also strife
to invest a lot in its
distribution strategies to
ensure that the competitors do not take advantage of its poor distribution
strategies.

Current Situation of Apple Inc

Despite the problems that have occasionally bedeviled Apple Inc causing the
company to drop its sales in various times, the company is now doing well.
The introduction of its latest devices like the iPhone and the iPad recently has
seen the company grow tremendously. In October 2010, the shares of the
company rose very high which is an indication that it is doing fine.

In the same year, the company also opened the Mac App Store for distributing
digital applications. The market capitalization of the company went beyond
that of Microsoft this year and it was rated as the brand with the highest value
in consumer facing issues. By July of 2011, the reserves of the company had
gone beyond those of the US government (Apple Press Info 10)