A magical and revolutionary device at an unbelievable price

Apple IPAD In India: Was There A

Way Out?
Presented By:-
Gyan Prakash
Bikash Acharya
Vishal Rana
Ankush Tiwari
Pratap Reddy
Steve Jobs
1955 - 2011
Steve Wozniak
APPLES FOUNDERS
History OF APPLE
1976
2011
Apple Computer is founded by
Steve Jobs & Steve Wozniak
1980
Apple goes Public after releasing
the Apple II
1984
1985
The Macintosh, an all-in-one
PC is introduced
Steve Jobs leaves the company
after being forced out by the
board
1989
The first portable Macintosh
is introduced
1997
Steve Jobs returns to Apple and
retakes the CEO Position
Apple hits financial trouble after stiff competition from the PC industry
1998
Apple iMac is introduced,
a huge commercial success
2001
The iPod is introduced --
Apple redefines the digital
music industry
2003
iTunes Music store opens
2007
2010
Apple reinvents the phone
by introducing the iPhone
Apple ushers in the tablet era
and redefines mobile
computing with the iPad
Introduction
1955-born


1976-Apple1
1977-Apple2



1980-went public
1981-IBM pc was launched



1984-Macintosh was launched




Started new company called next

Invested in pixar

Apple bought next

Launched Imac, Ipod, itunes, iphones, etc
L
e
a
d
i
n
g

P
r
o
d
u
c
t
s

Mac iPod
iPhone
iPad
Apple
tv
Oct,2011- Steve died


Present CEO is Tim cook
Case Summary
This case tells us about the evolution and market for tablets in
Indian as well as global scenario.

The impact of tablets on PC.

The case also tells us about the major players of tablets in
India.

Strategies adopted by Apple
1. Segmentation

2. Product strategy

3. Distribution strategy
Apple iPad
iPad3 to be launched in 2012
Customer were looking forward to have iPad3 with carbon fibre
chassis, 128 GB storage option, dual HD cameras, a high
resolution screen and base price lesser than iPad 2
Apple is the market leader worldwide for tablets
50% of iPad users were professionals
The iPad managed to capture the minds of gadgets lovers
everywhere and granted 83% market share in the first year itself
in the global tablet market
iPad was one of the fastest product ever to cross $ 1 billion in
revenue
Thinker, lighter and smarter almost the same mantra Apple
always used every time it launched a new version of its product.


Mission
Our mission is to bring the best personal computing
experience to students, educators, creative professionals and
consumers around the world through its innovative hardware,
software and Internet offerings


Revised Mission: To build a profitable business by providing
quality service to the customers and ensuring high efficiency
of effort from employees towards the achievement of
stakeholders wealth by using advance technology

Vision
To be a leader in providing simple, powerful, high-quality
information products and services for people who learn,
communicate, and create

Revised vision: Man is the creator of change in this world. As
such he should be above systems and structures, and not
subordinate to them.

The Evolution Of Tablets

The first Table PC named Newton, launched in the year 1993
by Apple Laboratories
Later in 2001, Microsoft introduced Windows XP Tablet PC as
the name of Tablet PC for the first time.
breakthrough came from Apple Inc. in the form of iPad in
2010
which has globally grabbed the highest market share as of
September 2011


Market For Tablets Global Scenario

Despite market volatility, the global tablet market was experiencing
significant growth since the entry of the iPad in 2010.
Worldwide tablet shipments were projected to rise to 60 million units in
2011.
The Dow Jones Newswires predicted that by 2015, global tablets sales
were expected to rise to 242.3 million units
The sales curve of tablets was rising very fast compared to other
electronic gadgets like HDTVs, handheld gaming consoles and mp3 players
Apples iPad dominated tablet traffic globally, but iPhone-Android race
was much closer on the smartphone front.
Growth of the global PC market for 2011 to 3.8 per cent from 9.3 per cent
in 2010.
The major reasons for this shrinkage were attributed to the slower
economies in Western Europe and the United States, along with a boom in
tablet sales




Market For Tablets Indian Scenario

Companies launching their iPad challengers into the market. Ever since
Apple introduced its iPad in April 2010 to the U.S. market
Major players like Samsung, Dell, HP and many others had followed this
In India, the tablet market was largely driven by the relevant content and
low prices
Samsung being the first to launch a tablet in this market during October,
2010, enjoyed its position as a market leader
Samsung had a 45.8 per cent share of the countrys 158,000 media tablets
sold within the first nine months since its launch
Research In Motions (RIM) PlayBook held a 21 per cent share Apple has
decent 18.4 per cent market share
Major players like Apple, Acer, Dell, HP, Motorola, RIM, Toshiba and HTC
attempted to take market share from Samsung
3G:wifi model sold in india-70:30

Tablet Players In INDIA
Samsung (Galaxy)
Launched the Android based Galaxy tab in November 2010
Available in two size- 8.9 inch priced 33,990 and 10.1 inch
36,200 both the new Galaxy tabs had exactly the same
hardware specification, varying in screen size and weight.
Including advanced screen resolution.

Motorola (Xoom)
In the business of connecting people for more than 80 years,
the corporation had become known for its ground breaking
communication technologies
The corporation was recognised for institutionalizing six
sigma quality improvement process
Xoom comes with a feature like 10.1 inch HD display,
functionally, is a smaller version of PC
Launched in two variants- Wi-Fi and 3G both the model came
along with a one GHz dual core processor, a 5 mega pixel rear
facing camera and a 2 mega pixel front camera. Price for that
is 32,990 & 39,990
In 2011 Google entered into and agreement to acquire
Motorola mobility for $ 12.5 billion.

Tablet Players In India
Dell (Streak)
Rim Blackberry (Playbook)
Acer (Iconia)
HTC (Flyer)
Toshiba (Thrive)
Cisco (Cius)




Strategy
Product Strategy:
Limited option approach

Distribution Strategy:


UNITED STATES INDIA
Own Retail outlets Future group
Best buy istore from Imagine (RSG Group)
Wal-mart/ Targets Reliance Digital
Verizon/ AT&T stores
Apple Specialists
Find one
APPLE SHARE IN INDIA
18%
21%
45.8%
15%
MARKET SHARE
APPLE RIM SAMSUNG OTHERS
Why Apple is in 2
nd
Position In India?
Launches its product later in India

Is India a dumping ground for
apple products?
Indian is a more Price Sensitive Market
Weak distribution channel



Thanks to the Indian govt. we wont get Indian apple stores , with
glass stairs and the huge apple on the front.
Apple earns by selling apps , games and songs
Apple assumed that Indian market was conservative
and did not have an appetite for luxury I Products
Technical Problems
Apple failing to have a camera in its premier version
The launch of iPADS 2 with dual camera was too late
iPad does not offer support for the Flash Multimedia Player
Apple lack in Bluetooth connectivity
Non availability of USB ports


Recent News
SWOT Analysis
STRENGTH
Strong Brand Image
Quality
Marketing and advertising
capabilities
Strong leading Team
Constant Innovation &
frequent upgrades

WEAKNESS
High Price
Weak distribution channels
in India
Lack of product breadth
Incompatibility with other
OS

OPPORTUNITIES
Introduction of new
products.
Growth of tablet and
Smartphone markets.
Expansion
Acquisition
Loyal Customer Base
Strongest player in mobile
apps market (350,000 apps)

THREATS
Rapid technological change.
Strong competition
Low cost products
Economic slowdown
Intense Competition (e.g.
Android)
Financial & Political
instability
Good Ideas are easily
copied

PORTERS FIVE FORCES MODEL
Direct Competitors
Indirect Competitors
Creator of the Android 3.0
platform for tablets
Creator of the upcoming
Windows 8 OS specialized
for tablets
Samsung GALAXY TAB
Small screen size, OS not
optimized for tablets.
Affordable price at cost limit
Motorola XOOM
Expensive ($ 799), OS not
100% ready yet. Price is
very high
Amazon KINDLE FIRE
No storage, data in the cloud
Low comparative price
Smaller Screen
HP TouchPad
Similar price & screen size but
OS not 100% ready. Rushed
to the market early
RIM PlayBook
Small screen size but OS not
ready at all, needs a
BlackBerry to fully utilize it
Functionality is of vital importance & minimizes consumers ability to bargain
iTunes ecosystem (apps, music & videos) locks-in the consumer
Fan Base / extremely wider audience and versatility in use cases (students to seniors)
Simplicity and small learning curve (easy to use)
Threat of new entrants
Apple is not manufacturing but only designing the iPad
Possible Cost-Aggressive entry by some of our suppliers (e.g. Samsung) or Assemblers (e.g.
FoxConn)

..but we are more than one year ahead & have strong brand name
Bargaining power of Suppliers
Major supplier is a specialized assembler (FoxConn)
Some suppliers are already competitors (e.g. Samsung)
Bargaining power of Buyers
PORTERS FIVE FORCES MODEL (cont.)
Threat of substitutes
Smartphone's
Higher quality
Phone & texting capability
Camera & video capabilities
Netbooks
Price
Wider range of buying options
No learning curve
Popular due to the crisis

Notebooks
Full Capabilities
Much wider range of buying
options
Bigger Screens
Extensibility
eBook Readers
Cheaper
Easier for reading under
sunlight conditions
Already popular
Only for book reading
PORTERS FIVE FORCES MODEL (cont.)
Political & Legal
Patent dispute with other
manufacturers / competitors
FoxConn suicide cases in China plant during
iPhone production
Supplier Code of Conduct must be
endorsed and according to domestic
laws
Environment & import polices worldwide could
affect sales in developing countries (e.g. BRIC)
Economical
Recession / Global economic crisis affects
customers buying capability
Customers are price-sensitive - price must
be affordable
Exports & currencies fluctuation can affect
profits
High expectations due to more educated
customers
Socio-Cultural
Intersection of technology & liberal
arts
Wider target audience not familiar with
computers need
Customer cultural diversity Declining trust in businesses and multinational
companies
MACROECONOMIC FACTORS
Technological
Netbooks are already popular Battery technology does not evolve in the same pace
System On a Chip is an
emerging technology
Multi-touch technology recently introduced and
adoption in large scale is unknown
Many standards of wireless
connectivity
Tablets were perceived as an expensive product only
for business uses
Environmental
Toxic substance removal (no
toxic substances at all)
Smaller Packaging of products leads to less
waste
Responsible manufacturing
(Supplier code of conduct)
Product recyclability and longer product
life leads to smaller carbon footprint
MACROECONOMIC FACTORS
MARKETING STRATEGY
Superior Quality
Reliability
Friendly and almost intuitive to use
Cutting-edge Design
Low Cost And Effectiveness
Usage Both For Professionals And Young Customers
Many use cases that will be promoted
(medicine, [special] education, advertising booths, exhibitions-galleries etc)
iPad will be marketed as
a product of:
PRODUCT
More capable
More intimate
iPad
than a smartphone than a laptop
PRICE
By outsourcing the assembly and using cost efficiencies
we believe we have hit the sweet spot
between price and quality
$ 499
For the base version
$110
Source: iSuppli
$90
$70
$230
+Apple Margin
Average Industry Margin
Cost of Sales
Cost of materials and
manufacturing
40%
PLACE
Directly from Online Apple Store
(phone orders included)
From the chain of 357
Apple Retail Stores
From a network of resellers
and worldwide partners
Newspapers and Magazines will use iPad
for content consumption / distribution
TV commercials developed by
Apple marketing department
Keynotes to the press and media
PROMOTION
Product placement in big & small screen
Extensive media coverage
(specialized sites and magazines only for Apple)
SUPPLY CHAIN
High integration with suppliers allows for higher customization
High volume equals big discounts on parts & assemblies costs
Control on every piece of supply chain from design to retail stores
Lock competitors out of the supply chain (e.g. HTC)
Effective transportation methods (e.g. air freight)
Tightly orchestrated process during new launches
Design Procure Assemble Deliver Sell
R&D

Incorporation of front and rear end cameras to the next iteration
Connectivity issues: USB for camera
SD Card reader
HDMI output is standard between our competitors
Weight reduction without compromising battery life
Improve readability in sunlight


OS development in close sync with iPhone
Books & Magazines buying capability to keep up with eBook growth
Expand gaming capability (single, multi & on-line)
Multitasking must not bring down battery life
Set-Up, sync and use must be distanced from PC & iTunes
Challenges in Hardware
Challenges in Software