Apple Inc.

in 2012

Nikhil Sharma-B053
Romill Sheth- B054
Parth Singh-B055
Somya Singh B056
Rahul V B059
Sunny Vaswani- B060
Bhanu Kumar- B061
Sai Krishna- B062
Prabhijit B063
Shiva Karthik- B064
Anish Varghese- B065

Case Study
Submission by
Group 6

Agenda

Introduction

Personal Computer History

Changing The Mac

iPhone

iPad

PESTEL Analysis

SWOT Analysis

IFE Matrix

EFE Martrix

CPM

Porters 5 Forces Analysis

Introduction

Apple Inc. (previously

Apple Computer, Inc.) is
an American multinational
corporation.

Apple Inc. ignited the

personal computer
revolution in the 1970s with
the Apple II.

The company's best-known

products include the
Macintosh line of computers,
the iPod, the iPhone and the
iPad

Mission Statement

Apple is committed to
bringing the best personal
computing experience to
students, educators, creative
professionals and consumers
around the world through its
innovative hardware, software
and Internet offerings.

Company Profile

Established : on April 1,1976.

Founders : Steve
Jobs,Steve Wozniak,
andRonald Wayne.

Industry:

Computer Hardware

Computer Software

Consumer electronics

Digital distributions

Steven Paul "Steve"

Jobs was an American
entrepreneur, marketer,
and inventor, who was
the co-founder,
chairman, and CEO of
Apple Inc.

History

[Insert Video Here*]

*File too large to upload

Evolution of the Personal Computer

The Personal Computer Industry

Buyers and Distribution

PC buyers fall in 5 categories: home, SMB, corporate, education and
government.
Home consumers value design, mobility and business buyers look at service
and support.
In distribution a big shift occurred when customers moved away from full
service dealers.
Large enterprises bought directly from manufacturers.
Home
and SMB customers bought from superstores, electronic and Web-based
PC Manufacturers
retailers.
Four
top PC vendors H.P, Dell, Lenovo and Acer accounted for 53.6%
shipments in 2011.
Until recently H.P was the leader, but market share got eroded and margins
declined.
Dells combination of direct sales and build-to-order manufacturing was
popular for a decade.
However, Dell struggled with cost controls and poor margins.
Lenovo
leads Complements
market share due
to Substitutes
dominant position in China, the fastest
Suppliers,
and
growing market
for
Suppliers
fall into
2 PCs.
categories : those that make products like memory chips,
keyboards and those who make microprocessors and the OS.
Microsoft has dominated the Operating Systems market since the IBM PC in
the 1980s.
Has introduced versions of Windows regularly Windows XP, Vista, 7,8, latest
being Windows10.
Value of a PC corresponds directly to complimentary software, hardware and
content available.
Substitutes such as cellphones and game consoles started to encroach on
functionality of PCs.

The Mac- Then and Now

Transition from the Personal Computer to a

Digital Hub

Digital Hub Strategy

Three Objectives of the

Digital Hub
o Control
o Integrate
o Add Value

The Focus shifted to user

experience

New Operating System

(OSX)

New Proprietary Appications

New Chip Architecture

Compatibility with Microsoft

Digital Hub Strategy

Complexity in the computers simplicity in the device

Three Objectives of the

Digital Hub
o Control
o Integrate
o Add Value

The Focus shifted to user

experience

New Operating System

(OSX)

New Proprietary Appications

New Chip Architecture

Compatibility with Microsoft

iPod

On October 23, 2001 Apple released theiPod

CPU: Samsung ARM and Apple A4
5GB hard drive that put "1,000 songs in pocket
Steve Jobs limited the capability of the device
First example of the Digital Hub

iPhone

[Insert Video Here*]

*File too large to upload

iPhone
Challenges Faced

Dominated by Nokia, Motorola &

Samsung with roughly 60% market
share

Short product life cycles and

sophisticated technology

Powerful cellular carriers controlled

most of the network

Verizon wireless and AT&T controlled

more than 60% of the market

Handset manufacturer was usually

dependent on the operator for
subsidies

The App Store

Key driver behind the iPhone sensation

Launched in 2008

585,000 applications by 2012

4 billion application downloads in 18

months

Apple generated an income of $6.3

Billion from the sale of music, books
and applications

App Store is compatible for the iTouch,

iPad and the iPhone.

Competitors

The App Store

Key driver behind the iPhone sensation

Launched in 2008

585,000 applications by 2012

4 billion application downloads in 18

months

Apple generated an income of $6.3

Billion from the sale of music, books
and applications

App Store is compatible for the iTouch,

iPad and the iPhone.

iPad

Launched in March,2010 as even more

intuitive and easier to use device than a
PC

9.7 inch device Priced between $499 to

$829 with No subsidy by carriers unlike
phones.

Debate about usage Model, Overtime

usage expanded

Controversy regarding bookstore and

competition with amazon

Result : 4.5 L iPad sold in 1st week , 55mn

till Feb. 2012

Earns 25% margin as compared to

competitors 15 by using its own cpu
despite entry level price lower than
iphone.

Built on its intellectual property position

by virtue of being the first mover

Political

Economic

Social

Political unrest in
China
Chances of
terrorist attack
Ban on Tim Cook
in Russia

Increased rate of
inflation and rise
of dollar value in
USA
Europes
economic
difficulties
Impact of global
recession &
Increasing labor
cost in China
.

An accessory of
high-status
lifestyle
Potential market
place in third
world country
Brand acquisition
in many countries

Technological

Legal

Environmental

Competitors
offering the
products with
similar
configuration
Offering financial
services by Apple
Pay
Breach of IP laws

Disposal of used or
non-working
electronic devices
Pollution concern in
China
Attempt to cut
greenhouse effect
increases cost in
China
Global warming
&
Increased electricity
costs

Assessing the
consumers minds
&
Preferences to
screen size
The growing
menace of cyber
crimes
Competitors
offering the
products with
similar
configuration

SWOT

Internal Factor Evaluation

Matrix(IFE)
Key Internal Factors

Weight

Rati
ng

Weighted
Score

iTunes Music Store is a good source of revenue. especially with

the iPod and the availability on Windows platform.

0.15

0.60

Apples niche audience provides the company with some

insulation from the direct price competition.

0.10

0.30

Revamping desktop and notebook lines.

0.10

0.30

Low debtmore maneuverable.

0.06

0.24

Developing own software and hardware.

0.14

0.42

Good brand loyalty.

0.05

0.15

Web technology can be used to improve product awareness and

sales.

0.10

0.40

Dependency on new product launches.

0.06

0.06

Weak presence in business arena.

0.07

0.07

Slow turn around on high demand products.

0.03

0.06

Weak relationship with Intel and Microsoft.

0.10

0.10

Weak presence in markets other than education and publishing.

0.04

0.08

Total

1.00

Strengths

Weaknesses

2.78

External Factor Evaluation

Matrix(EFE)
Key External Factors

Weight

Rating

Weighted
Score

Opportunities
Increase in worms and virus on PCs.
Downloadable music and MP3 players are highly marketable.

0.15

0.6

0.6

0.18

Large population (Gen X & Y) which are extremely individualistic

and name brand conscious.

0.15

0.6

Increase in sales of laptops by 20 percent.

0.04

0.12

Increasing sales of computers online by 25 percent.

0.05

0.15

0.1

0.4

Increasing competition with music downloads.

0.07

0.14

Intel's future Pentium release.

0.03

0.09

Creating more ties with Microsoft products.

Threats

Dell and HP are major competitors.

0.1

0.4

Dell does not invent but provides computers at a more cost

effective rate for customers.

0.06

0.18

Recessionprice of Apple computers are higher

0.04

0.08

Companies not seeing Apple as compatible with their software.

0.15

0.3

TOTAL

3.24

Competitive Profile
Matrix(CPM)
CPM

Apple

Critical Success factors Weight Rating Score

Microsoft
Rating

Dell

Score Rating

Samsung
Score Rating

Nokia

Score Rating

Score

Store Locations

0.10

0.40

0.30

0.20

0.20

0.30

Financial profit

0.12

0.48

0.48

0.24

0.24

0.24

Consumer loyalty

0.10

0.40

0.20

0.20

0.3()

0.30

Market penetration

0.11

0.33

0.44

0.22

0.44

0.33

Advertising

0.07

0.21

0.28

0.14

0.21

0.21

Product variety

0.09

0.18

0.27

0.27

0.36

0.36

Market Share

0.11

0.22

0.44

0.22

0.33

0.33

Product quality

0.08

0.32

0.24

0.32

0.24

0.16

Price competitiveness

0.10

0.10

0.30

0.30

0.30

0.40

e-commerce

0.06

0.24

0.24

0.12

0.12

0.06

Employee dedication

0.06

0.24

0.18

0.18

0.12

0.18

Totals

1.00

3.12

3.33

2.41

2.86

2.87

Bargaining
Power of
Apples
Customers
1.High
switching cost
(Weak force)
2. Small size of
individual
buyers (weak
force)

Bargaining
Power of
Apples
Suppliers
1.High number
of suppliers
(weak force)
2. Apple
accounts for a
large volume
(Weak Force)

Porters 5 Forces

Competitive
Rivalry
1. High
aggressivenes
s of firms
(strong force)
2. Low
switching cost
(strong force

Threat of
Substitutes
or
Substitution
1. High
availability of
substitutes
(moderate
force)
2. Substitutes
low
performance
(weak force)

Threat of New
Entrants
High capital
requirements
(weak force)
High cost of
brand
development
(weak force)

Future of Apple