1.

Apple
Apple Inc. (formerly Apple Computer Inc.) is an American computer and consumer
electronics company famous for creating the iPhone, iPad and Macintosh computers. Apple is
one of the largest companies globally with a market cap of over 2 trillion dollars. Apple
devices are renowned for their design aesthetic and attention to detail. Tight integration
between hardware and software gives their systems a performance advantage over competitor
systems with similar specifications. Apple rose to its position as a market leader by correctly
positioning its products. They didn't invent personal computers, graphical user interfaces
(GUIs), mp3 players, smartphones, smartwatches or tablets. Instead, they produced some of
the first versions of these products that were refined, easy to use and well-designed, which
led to wide market adoption. (Wright)

2. Mission and vision

Apple’s mission statement is “to bring the best user experience to customers through
innovative hardware, software, and services.” Apple’s vision statement is “to make the best
products on earth and to leave the world better than we found it.” (PEREIRA, 2023)

3. PESTEL
This PESTEL/PESTLE analysis of Apple Inc. identifies external factors in the company’s
industry environment. The PESTLE/PESTEL analysis framework evaluates the political,
economic, sociocultural, technological, ecological, and legal (PESTEL) factors relevant to the
business. While Apple has a leading position in the premium consumer electronics market,
this PESTEL analysis shows that the company must continue evolving its strategies to keep
its leadership.

a. Political Factors Affecting Apple’s Business

The political factors in Apple’s remote or macro-environment mainly present opportunities.
This aspect of the PESTLE/PESTEL analysis model indicates the influence of governments
and related organizations on businesses. Better free-trade policies are created over time. This
external strategic factor increases the opportunities for Apple Inc. to distribute more of its
products around the world. This PESTLE analysis also identifies the stability of the political
landscape of developed countries as an opportunity for Apple to grow, considering the
minimized political problems affecting business operations in these countries. This part of the
PESTEL analysis of Apple indicates potential performance improvement by taking advantage
of political opportunities in the company’s remote or macro-environment, although caution is
needed to ensure business stability despite trade disputes.

b. Economic Factors
Many of the external factors in Apple’s remote or macro-environment create economic
opportunities. This aspect of the PESTLE analysis model indicates market and industry
conditions that impact firms. The economic stability of developed countries creates
opportunities for Apple’s expansion. However, the rapid growth of developing countries is a
more significant economic factor in this PESTEL analysis case, in terms of support for
growing the technology business. On the other hand, unstable disposable incomes create
unpredictability in selling the company’s premium-priced technology products. External
strategic factors indicate growth potential for the corporation and its competitors, especially
Google, Samsung, and other large multinational firms. Based on this economic part of the
PESTLE analysis, speed and effectiveness are critical in Apple’s growth and expansion
efforts, although caution is needed regarding unstable disposable income levels.

c. Social/Sociocultural Factors in Apple’s Industry Environment

Apple’s business is subject to the effects of social or sociocultural trends. This aspect of the
PESTLE/PESTEL analysis model points to the social factors that influence customer
behaviors and expectations. The rising use of mobile access is an opportunity to grow
Apple’s revenues. This external factor relates to the increasing demand for mobile devices,
like smartphones and tablets. This PESTLE analysis also points to people’s increasing
dependence on digital systems, which is another trend that creates opportunities for Apple to
sell more of its products.. Also, Apple’s organizational culture (work culture) is relevant
because it influences the quality of service provided to customers. In this part of the PESTEL
analysis of Apple Inc., growth opportunities and threats are identified. These strategic
concerns require improvements to the company’s policies, practices, and approaches to
technological innovation, service provision, and marketing. Apple’s marketing mix
(4Ps) must include strategies that match social factors.

d. Technological Factors
The external factors in Apple’s remote or macro-environment provide technological
opportunities for the enterprise. This PESTLE analysis of Apple Inc. identifies growing
demand for cloud-based services as an opportunity to grow the business. The company now
offers cloud services, although to a limited extent. In exploiting this opportunity, together
with support from Apple’s organizational structure (business structure), developing an
expanded cloud infrastructure can maximize business profitability in offering cloud-based
services. Also, the external strategic factor of increasing technological integration presents
the opportunity to enhance the company’s services and grow the business by offering its
technological goods and services to more customers, including organizations. Furthermore,
this PESTEL analysis includes the growth of the mobile market as an opportunity for Apple
Inc. to gain higher revenues, such as through the App Store and related digital content
distribution platforms for iOS and iPadOS. However, the technological advancement of other
firms threatens the company, as more new players can enter the market. Thus, to ensure the
achievement of the goals of Apple’s mission and vision, it is beneficial to reinforce business
capabilities for exploiting technological opportunities and for protecting the business against
the competitive threats shown in this part of the PESTLE analysis.

e. Ecological/Environmental Factors in Apple’s Business Environment

The ecological factors in Apple’s remote or macro-environment provide opportunities for
business improvement. This aspect of the PESTLE/PESTEL analysis model highlights
ecological trends and their impacts on business. The business sustainability trend is an
ecological factor linked to increasing favor among businesses to adopt sustainable practices
to reduce the environmental impact of business operations. In this PESTLE analysis of Apple
Inc., such an ecological trend offers the opportunity to strengthen the company’s corporate
image. In addition, the energy efficiency trend is an external factor that promotes the
adoption of newer and more efficient technologies among businesses and customers. In this
regard, Apple’s technology business has the opportunity to improve its operational
efficiencies, while offering more attractive products to an increasingly environmentally aware
customer population. Based on this part of the PESTEL analysis, Apple addresses these
ecological/environmental factors in its remote or macro-environment. The company’s
strategic measures, such as supplier responsibility policies, respond to these ecological
trends.

f. Legal Factors
The external factors in Apple’s remote or macro-environment create legal and regulatory
threats to the business. This aspect of the PESTLE analysis framework indicates the impact
of laws or regulations on businesses. Governmental pressure for privacy in the digital age has
resulted in increasing privacy regulations on businesses, like Apple Inc. This legal factor is a
threat that imposes costly regulatory compliance requirements and more limits on the
technology company. However, this PESTLE analysis identifies the same external factor as a
trend that presents the opportunity for Apple to boost its business through enhanced privacy
measures. In addition, the company faces legal challenges related to its practices and policies
on after-sales service and other areas of the business. Based on this part of the PESTEL
analysis, Apple must emphasize privacy protection and regulatory compliance in all its
products and consider adjusting its policies and practices to address current legal pressures on
its business. (LOMBARDO, 2024)

4. SWOT analysis
4.1 Apple’s Strengths

a. Most Valuable Brand

Apple is ranked #1 position for the 9th consecutive year by Interbrand – with a brand value of
$408 Billion. Followed by Amazon ranked at #2 with a brand value of $249 Billion, and
Microsoft ranked at #3 with a brand value of $210 Billion.

b. Globally Iconic

Apple is one of the most reliable company when it comes to personalized advanced
computers and smart technology devices. It has millions of loyal customers with steady
increment.

c. Top Technology

Apple was the first to introduce some of the most innovative products that have changed the
world (iPhones, iPads, AirPods). Apple is still determined to build and craft better, more
proficient technology devices.

d. Brand of Choice

It isn’t big news that Apple is a favorable brand in corporate offices, especially among
creative professionals. Apple offers top-quality technology solutions for every corporation’s
needs. Professionals prefer high-performance technology such as Mac Pro or iMacs for visual
design, animation, video production, and other creative work.

e. Proficient Research & Development

Apple puts dedication into its product designs. Careful study and extensive research is
performed to help understand customer needs and market trends. Apple continues to invest a
substantial amount of money in research and development for future growth and a
competitive edge. For example, Apple spends $26.25 Billion (about 7%) of its revenue in
R&D.

f. Sustainability made Possible through Liam

Liam is an iPhone recycling robot that breaks down and dissects an iPhone. It strips them all
the way down to a single bolt. Most parts of an iPhone can be reused. Liam is designed to
yield as many reusable parts as possible. These reusable parts are then categorized and safely
stored so they can be used for new manufacturing. (Gupta, 2024)

4.2Apple’s Weaknesses

a. High Priced Products

Apple’s products can be considered a luxury due to their premium prices. The products are
priced for middle and high-income consumers. Low-Income consumers can’t simply afford
Apple products. Due to their premium pricing, only middle or high-earning individuals can
afford their products.

b. Limited Advertisement & Promotions

Apple has solidified their grounds by establishing loyal customers, even with limited
advertising resources. Apple marketing relies heavily on its iconic and flagship retail stores.
Because of their success, Apple does not feel the need to have excessive spending towards
advertisement in comparison to other big brands such as P&G, Pepsi, Verizon, and Coca Cola
etc.

c. Entering into Area of Non-Competency

Apple is rapidly expanding into new services such as video content streaming, game
streaming, payment services (credit cards) – competing with the dominant players such as
Netflix, Disney, Citi, Chase, PayPal, etc. They might be entering into areas in which they
lack competencies; remember the failure of Apple maps.

d. Incompatibility with Other Software

When a customer buys an apple product, they enter the Apple universe. Apple’s products do
not support other software or technologies making them incompatible with other devices.
Customers have to exclusively purchase Apple apps or accessories to continue using their
Apple products.

e. Allegations of Tracking

Tracking users undermines trust. Apple has been accused of using tracking apps in its phones,
which revealed the precise location of users. Even though the latest version of Apple’s
phones gives users the right to decline the tracking, trust is difficult to regain once it is lost.

f. Unfair Business Practices

Apple is under investigation for unfair business practices after receiving payments to make
Google’s search engine as the default search engine for its Safari web browser. Collusion
between the two giants makes it difficult for rivals to enter and expand into the search engine
market. (Gupta, 2024)

4.3 Apple’s Opportunities

a. Consistent Customer Growth

Apple has been dominating the technology sector for years now. They provide top quality
and cutting-edge technology that offers a breakthrough in customer experience. Their
customer retention rate of 92% is phenomenal. Apple can always rely on the power of the
internet for future opportunities to gain new customers and form new alliances.

b. Qualified Professionals

Apple’s researchers, developers, and product specialists are a team of highly qualified
professionals that have years of experience in branding consumer products. With the
expansion of their team, Apple can continuously build new opportunities.

c. Expansive Distribution Network

Apple Inc. has the opportunity to expand its distribution network. Currently, the distribution
network that Apple has is very limited and leaves room for minimal growth. Apple can
generate higher revenue and sales if it focused on creating an expansive distribution network.
Furthermore, the company can benefit from diligent marketing and promotions.
 d. Lack of Green Technology

Apple is yet to launch products that are created using green technology. The company has not
yet implemented or participated in creating sustainable technology that is eco-friendly.

e. Smart Wearable Technology

Smart wearable technology will soon dominate the world. According to Forbes, smart
wearable technology device sales will double by 2022. It will become a $27 billion+ market
with 233 million unit sales. Apple has the opportunity to continue to grow beyond just Apple
watch and Air Pods into other wearable categories. (Gupta, 2024)

4.4 Apple’s Threats

a. After effects of Coronavirus Outbreak

Apple is highly dependent on China for its manufacturing and supply chain. The recent
events have significantly affected and disrupted its operations. In addition, about 19 % of its
$394 billion in revenue came from China (a big market for Apple). The outbreak has
significantly affected and may continue to disrupt Apple’s business in coming years.

b. No Effective Countermeasure for Air Tags

While Apple’s Air Tags are meant to help people find frequently misplaced items using
Bluetooth, the technology is also being used with malicious intent. There have been a lot of
instances where criminals have used Air Tags to steal cars and, worst, stalk people.

c. Apple Bullied by Counterfeits

Apple has become vulnerable to third world countries illegally utilizing the brand image to
sell counterfeit products. The illegal dealers sell Apple counterfeit products at the same value
as an original Apple product. Counterfeit products can make potential customers believe that
it is a product made by Apple with low quality. big news can result in negative reviews and
bad publicity for the company.

d. Increasing Competition

Although Apple as a brand has solidified itself, it still faces threats from competitors. With
the advancement in technology, brands like Samsung, Google, and Dell are giving Apple
tough competition. As the competition is getting stronger, Apple either has to introduce new
technologies or revise its pricing policy to stay ahead of its competition.
 e. Market Penetration

There has been a significant change in market penetration by other brands in the smartphone
market. Companies like Samsung, HTC, and Lenovo are using Android software to create
new smartphones. Currently, Android has captured 72.23% of the market share, while Apple
has only 24.55% of the market share globally.

f. 6China Tariffs

US government has imposed a higher tariff on imports from China, increasing the overall
cost of the products. Consequently, it adversely affects the gross margin on the products and
may make the product more expensive for customers. (Gupta, 2024)

5. Porter 5 Forces

Porter's five forces for Apple shows that the two strong forces are industry competition and
the bargaining power of buyers. The bargaining power of suppliers, the threat of buyers'
bargaining power, and the threat of new entrants in the marketplace are all comparatively
weak or moderate elements. Let us look at the model in detail.

 Competition in the industry (Strong force)

 The threat of new entrants (Moderate force)
 The bargaining power of suppliers (Weak force)
 The bargaining power of customers (Strong force)
 Threat of substitute products or services (Weak force)

5.1 Competition in the industry (Strong force)

Apple competitors' analysis shows that many companies directly compete with Apple,
including Google, HP, Samsung, etc. Every company conducts massive research and
development to introduce the most innovative products to gain market share. We know that
switching devices and OS is usually low to moderate cost action, and consumers do not need
substantial investment to switch from Android to iPhone or vice versa. Hence Apple
competitors' analysis also shows the strong force of competition in the industry. Various
factors contributing to this force are;

 The high aggressiveness of competitors in R&D and innovation is a strong force.

 Low differentiation of products is another strong force.
 Consumers can buy a new product without substantial investment, so the low
switching cost is another strong force.

5.2 The threat of new entrants (Moderate force)

In Porter's five forces for Apple the threat of new entrants is low to moderate. Establishing a
big company within the industry is extremely expensive, and it needs finance, manpower,
infrastructure, and marketing. To make a noticeable mark in personal computing and gadgets
also requires brand recognition, which is another overhead.

The other challenge is that standing in the face of already established companies like Apple,
Google, and HP is not easy. Let us see the contributing factors.

 High investment requirements are a weak force.

 Brand development cost is another weak force.
 New entrants' potential and capacity development is also a tough call, which is a
strong force.

5.3 The bargaining power of suppliers (Weak force)

In Porter's five forces for Apple, the bargaining power of suppliers is a weak force. Apple has
many potential suppliers with adequate supply, and these suppliers can provide parts,
processors, packaging, and virtually everything related to Apple products. Also, Apple enjoys
economies of scale, and suppliers do not want to lose the business.

Factors contributing to the weak force of bargaining power of suppliers are;

 A large number of suppliers is a weak force.

 The weak force of large order size by Apple.
 Firm concentration to supplier concentration ratio is another weak force.

5.4 The bargaining power of customers (Strong force)

Factors responsible for the bargaining power of customers in Porter's five forces for Apple
are both individual bargaining power and collective bargaining power. Individual bargaining
power is weak because losing a single client does not affect Apple's revenue. However,
collective bargaining power is a strong force.

Various factors contributing to the consumers' bargaining power are;

 A strong force of low switching cost.

 A weak force of individual bargaining power.
 A strong force of collective bargaining power.

5.5 Threat of substitute products or services (Strong force)

In Porter's five forces for Apple, we see a weak threat of substitute products. This is a weak
force because currently, we do not see any products that can surpass the facilities provided by
Apple's products.

The breakdown of contributing factors to the threat of substitute products is as follows.

 Moderate to the high availability of substitutes is a moderate force.

 Inadequate substitutes are a weak force. (edrawmax)

6. Diamond Strategy
7. Business Model Canvas

8. Conclusion