Presentation By: Akshaya Mali

FINDING MARKET SPACE Getting Customer Experience Right OBSESSING ON CUSTOMERS Value Proposition & Indifference COMPETING WITH YOURSELF Line Extensions Incremental Improvements

New Product Development Competitive Advantage Market Dominance Product Differentiation

Steve Jobs Demise of the iconic CEO has caused considerable amount of flutter in the industry and people are speculating the moves of Tim Cook. The problem was that Jobs made himself irreplaceable and the company though well organized revolved around him. AT&T Their bad services in a lot of areas in the US is draining down the goodwill of Apple from its users. Computers Apple iPads are soon going to make Macbook Pro obsolete soon. The future will be more mobile, faster, smaller and better. The App Store There is too much scrutiny by Apple on the kinds of apps that are available. This might become unsustainable soon.

Security Even though Apple OS is not affected much by malware, they still need to be on the watch for any vulnerability.
Mobile Me This iPhone interface to the Mac has web apps which are essentially of no use. Apple does not need to invest in these. Back Ups Most back-ups for Apple products are local. This is a major problem in case of data loss. Apple TV Apple TV has proved to be a failure. It needs major functional and services changes in order to attract buyers. Arch Rivals Apple has grown too big to be challenged by anyone. This will make them complacent. About box credits Due to the fear of headhunting, Apples designers are not given credits. This might cause dissatisfaction in the workforce.

Apple has diversified immensely since its inception and has emerged to be the leader in the PC industry because of its unique design and timely innovative products/services. Same can be explained with the help of Ansoffs matrix.

Market Penetration Apple penetrated the market with its current products/services in the current market in order to increase its market share and attract non-users towards its products/services. For the same, Apple came up with iTunes and App store as complementary services for its products. These services were of immense use for the consumers because of they were user friendly hence, easy to use. Product Development Apple came out with its new products/services like iPad, iCloud and brought in lot many changes in the Mac OS. Apple introduced new OS X in 2001 which was based on UNIX. This costed Apple roughly $1 billion to develop. Later in 2007, Apple came up with a new version called Leopard which ran on more than half of all Mac computers by 2010. Apple not only developed a new product but also managed to attract consumers away Windows XP. Apple had two notable products that failed to live upto expectations. One was Mac Mini and the other was Apple TV. Mac Mini failed due to limited memory and few expansion options.

Market Development: For market development and to increase its revenue, Apple had a huge potential in emerging markets like China and India. Even though there was an intense competition in these markets from the white box PCs, Apples differentiation strategy helped it develop its products/services in these emerging markets. Also, more than a million first generation iPhones were sold in the grey market, which reflected the demand for Apple products in other markets of the world. Diversification: Apple started originally as Apple Computers, best known for its Macintosh personal computers. Later it shifted towards a digital hub strategy which was initiated by the debut of the iPod in 2001, followed by the iPhone in 2007, then the iPad in 2010. This diversified the company from making computers to producing lot many other digital products. The common thread for all the Apples products/services was the companys innovation and unique designs which differentiated Apple products/services from other competitors and gave the company competitive advantage over other companies. The following PLC diagram shows the diversification of Apples products so far and their stages in the diagram.

PC Economies of Scale: R&D is especially a big part of the cost of producing (R&D cost in computers hovers at 12% of sales by the U.S. industry). Product Differentiation: Apples PC has its own operating system and the unique design. Cost Advantage: High demand particularly in proprietary technology.

LOW

Mobile Products LOW Economies of Scale: High demand in R&D and marketing (todays cell Phones come with a lot of add-ons like camera, voice recorder, speakerphone, MP3 player and FM receiver. They also have built in memories to record and retain voice and pictures and facility to download them to a computer). Product Differentiation: iPhone has add-on functions with technology from their own PC and MP3 player.

MP3 player/online music services

LOW

Since iPod nano launched, some competitors such as Rio and Olympus had preferred to stop. Economies of Scale: iPod has 80% of market share and Apple contracted with Samsung to buy 40% of its flash memory production which is two times More expensive than a hard drive. Product Differentiation: iPod has its own music store like iTunes which allows customers download music conveniently. The complete set of iPod iTunes and the accessories for iPod. Cost Advantage: High demand in proprietary technology. Apple has several patents for iPod and favorable access to raw materials by the contract with Samsung.

PC There are relatively few competing firms compared to other industries, HIGH but Microsoft has most of the market share.

Lower priced PC makers like Dell have been growing in the market.

MP3 player/online music services

There

MODERATE

are various competing firms such as Samsung, Sony, i-River, etc., but iPod has almost 80% of the market share.

But if it does not keep the products innovative, the other companys products which are lower in price than iPod can be a significant threat in anytime.

Mobile Products

HIGH

-There are relatively large number of competing firms such as Samsung, LG, Motorola, etc., but the latest market data revealed that Google announced the launch of its new version Android KitKat and Apple launched its new pocket suitable series iPhone 5S and 5C. - Apple broke its policy of only black, white and silver handsets Mocking the new Apple series, Nokia tweeted a picture of its own range of cell phones in funky colours.

PC -Many types of products such as PDA, DVD player, and calculator can exist as a substitute for PC, but these can substitute only one or two functions of PC.

LOW

MP3 player/online music services - The substitutes for MP3 player can be a CD player, MD player, radio, etc.; but cheaper and easier access to MP3 files has been making customers leave from the other music players.

MODERATE

Mobile Products - Mobile phones can be substituted by home phones, internet messengers, etc., but the main convenience of mobile phones which is the portability cannot be easily substituted.

LOW

PC MODERATE The major suppliers are of raw materials and the labor which is highly proprietary in technology and has the power to impact price. Besides the threat of the labor which includes the technicians, there are relatively various suppliers for the raw materials. MP3 player/online music services The suppliers for raw materials and labor can be the threat, but the supplier who holds the main profitability is the song writers, singers and players. Another big threat is the illegal free music download websites or P2P file- sharing sources. Easy and cheap access to MP3 files can encourage the MP3 player market, but on the other hand, this can be the threat to iTunes. HIGH

Mobile Products
Todays

LOW

phone has a lot of functions in addition to calling/receiving so there are many kinds of suppliers for the camera, MP3 players, Video players, memories, etc.
Apple which

is already in the industry of PC and MP3 mostly deals with internal mediates and suppliers.

PC The number of buyers is huge and growing as new technologies are MODERATE introduced at a fast pace. Apple differentiated by creating its own operating system and unique design, but other companies like Dell or HP differentiate by lower price marketing.

MP3 player/online music services The number of buyers is continually increasing and they keep demanding new and updated products. The internet speed and the music file providers are developing and these environments encourage the MP3 buyers. IPod has relatively loyal customers.
Mobile Products The number of buyers is even huger than the PCs. Also the buyers keep increasing with the new market of other developing countries.

LOW

LOW