APPLE INC.

( MBA 660 USM) Presented By: Jennifer Cao Mercy Antony Tejal Sinora Lashunda Price Logan Tisdale

Change the World through Technology

April 1976, Apple Computer, Founder Steve Jobs Industry: Computer Hardware and Software, Consumer Electronics 1984, Macintosh Sculley- Mac with new features Amelio- Return to Premium Price Jobs back-Apple Turnaround

Current Scenario
Sales

Current Issues
Steve Jobs

Current Issues
1Q Market Share08

Low Market Share 6.6%

Dell HP
Acer Apple Toshiba Others

Opportunities
Fast growing Industry (Customer Electronics Industry) Technological Innovations Extend new products to loyal customers High Potential music phone market Strategic Alliances

Big Move
Jan 2007- Apple Inc. CE Industry

Competitor Environment
High Competition Share of Dell and HP Microsoft and Intel-Leaders of Software CE Industry- Sony, Nokia, Samsung, Cisco, Motorola

Competitor Environment

Threats
Extensive Competition Substitute Products Low prices of Competitors Technical Advancements Economy downfall

Five Forces Model

Strengths
Branding Innovation Differentiated Product Ease of Use Superior Quality Retail Strategy

Strengths
Marketing and Sales Customer Loyalty Online Sales

Weaknesses
High Price Proprietary System Niche Market, Less Penetration Cannibalization

Core Competencies
Differentiation Strategy
Value Creation

Differentiation Strategy
Unique Features and characteristics Commands Premium Price High Customer Service Superior Quality Prestige Rapid Innovation
Sustainable Competitive Advantage

Value Creation Process

Apple I,II,III

Mac

FF
Focus On Education

C o n v e r g e n c e

eMac
Music Strategy (iTunes)

Video Strategy (iMovie)

Lifestyle Strategy

Adding Value

Internet Strategy (iTools) Digital Hub

iMac

Technology Development
New Product Ideation Designing / Funding Product Creation Diffusing products across company

Value Chain
Inbound Logistics Operations Distribution Sales and Marketing Service

Apples Strategy
Apple employs a Product Differentiation Drawbacks as a result of their strategy include:
Not appealing to Price Conscious Consumers Risk of Imitation by Competitors Risk of Change in Customer Taste

Apples Problems
Prices Too High Low Customization

Low Market Share

Strategic Alternatives
Problem Strategy Alternative
Extend their current product line to include some products with a lower price point. Ex. Re-launch Mac Mini Low Market-Share Price Differentiation

The Strategy
Two Fold Agenda
Continue to focus on niche market Set up for Jobs replacement

Market Share
Consistently low share High success in niche market Brand differentiation

Previous CEOs
Ups and Downs of their own Established Identity of Apple Jobs success rate

Focus
Concentrate on current customers Expand niche market Use iPod as gateway

Replacement Plan
One year planning phase Jobs appoints successor Two year mentoring phase Chief advisor position

Questions????