COMPETITIVE STRATEGY OF APPLE

Running head: COMPETITIVE STRATEGY OF APPLE
COMPETITIVE STRATEGY OF APPLE
Name of the Student
Name of the University
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Table of Contents
Introduction................................................................................................................................2
Discussion..................................................................................................................................2
About the company:...............................................................................................................2
Competitive options or aspects of Apple:..............................................................................3
Competitive strategies based on competitive options:...........................................................3
Instance on base of competition:............................................................................................5
Conclusion..................................................................................................................................5

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Introduction
A long-term plan dedicated towards a specific organization for acquiring a
competitive advantage amongst the competitors of the same industry is known as competitive
strategy. The aim of constructing defensive or attacking strategy or strategic position in the
industry demonstrates the prime role of competitive strategy (Parast, 2017). The role of
competitive strategy also involves generation of superior Return on Investment. Competitive
advantage of a business reflects the feature of allowing a company to outperform amongst
competitors. Competitive advantage includes various factors or aspects that address the need
of responding to the competitors (Molina-Azorín et al., 2018). Various options of framing the
competitive advantage includes, resource availability, skilled labors, high entry barriers, low-
cost power source, access to advanced technologies and entry strategies.
The purpose of the paper is to present the competitive strategies of a selected
company with respect to five aspects or competitive options. The chosen company for this
assignment is Apple. The paper will also include an instance demonstrating the competing
aspects between Apple and Samsung. The paper will be concluded by presenting a summary
demonstrating the competitive strategies of the company to maintain the strategic position in
the industry.
Discussion
About the company:
The multinational technology-based company, Apple is headquartered in California,
Cupertino. The company designs, manufactures, develop and distribute the consumer
electronic, online services, computer hardware and software directly and through authorized
sellers to consumers. The online services of the multinational company involve iOS app
store, Apple Music, iCloud, Apple TV+, iMessage, iTunes store and Mac App store. The

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company was founded in the year 1976 by Steve Jobs and Steve Wozniak. From the
origination, the company aimed at creating a new vision for the perception about computers
and technological device (Apple.com, 2020). The purpose of building the company also
aimed at designing the computers, which can be availed for the purpose of setting up at
offices and homes. Apple is known for its prominent contribution in the software and
hardware industry with the association of innovation (Apple.com, 2020). The company
introduced Macintosh in the year 1984, which was the first ever widely sold PC (Personal
Computer) with GUI, Graphical User Interface.
Competitive options or aspects of Apple:
The competitive option of the company Apple is solely dedicated towards the purpose
of maintaining the brand reputation and position amongst existing and potential competitors
of the company. The multinational company, Apple operates in the technological sector by
competing with the key competitors, Samsung, Lenovo, Microsoft, HP, Dell, Google and
Sony. The aspects which are responsible for comprising the competitive options in the
industry are Pricing, Customer Loyalty, R&D (Research and Development), Brand Equity
and Global Presence (Gavetti & Porac, 2018). These aspects or resources are what make the
company successfully relevant and reputable even amongst a number of potential and
technology-advanced key competitors.
Competitive strategies based on competitive options:
Pricing: Apple started with a niche market segment and has gradually shifted with the
purpose of dominating the market with product and service offerings. The pricing strategy of
the company can be explained through various conceptions including, Premium pricing and
price skimming. Through the adoption of price skimming, Apple avails the profit from the
market by setting a higher price, but this strategy is only adopted in the introduction phase,
introduction of newer products and services reduces the prices of the older designs and may

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also cannibalize the older products. On the other hand, the pricing strategy of Apple is
primarily based on premium pricing. Both the pricing methods involve high probability of
risks, specifically in premium pricing strategy. However, the premium pricing strategy of the
company has been utilized and proved for the source and strength of competitive advantage
for the company. The strategy created a distinctive image of the brand. The sense of
premiumness is created by design and accompanied by the pricing aspects.
Customer Loyalty- One of the significant competitive option for the company is customer
loyalty, especially in the 21st century. The company invests strategically in extracting
continuous feedback from the market to understand the unrecognized need or desires of
consumers (Straker & Wrigley, 2016). With the introduction of numerous products and
associated online services, Apple has constructed an ecosystem, which can add ease of
operation by synching the functionality of every Apple product (Purkayastha & Sharma,
2016).
R&D- Research and development what makes Apple distinctive than other companies. The
company invests majority of its funds or profits in designing innovative products and services
for keeping the image of premiumness and maintains reputation. Apple invests around 5
percent of the net sales for R&D. The R&D investment for 2018 was 14.24 billion dollars
from 11.6 billion dollars in 2017.
Brand Equity- The reliability of technology, security of online services and products with
remarkable design, premium style and continuous innovation are the strategic initiatives that
contributes in strong brand equity, thereby helping in framing competitive advantage
(Clemons, 2019).
Global Presence- The Company has reached numerous attractive markets of the world such
as, Asia, Europe, America, China and Japan. Although, similar offerings are sold in all

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market but are handled individually in terms of marketing communication approach,
government support and distribution partner relationship. The international marketing or
global presence strategy of Apple is differentiation strategy, which is an approach focused at
the development of unique services and products by accompanying unique marketing
message, vision and continuous improvement of hardware and service delivery.
Instance on base of competition:
One of the main competitors of Apple is Samsung. Both the companies have
distinctive values which makes them unique from their competitors. The main competitive
distinctiveness of the two companies or brands is that Apple competes with Premium pricing,
premium design and strong brand equity whereas Samsung competes with huge economies of
scale. Apple has created strong brand equity by constructing the sense of premiumness,
market reputation, investing in R&D than in heavy production and by creating an ecosystem
(Yun, Lee, & Aoshima, 2019). Samsung competes by the advantage of economies of scale as
it represents industrial conglomerate with the concentration of addressing various segments
of offerings.
Conclusion
Therefore, it can be concluded that a company can establish and maintain its position
in the market by addressing the unrecognized or unmet market opportunities and by
designing strategies that best suits the convenience and sense of accomplishment of the
customers. Apple has maintained its premium image by addressing the demand of advanced
technological requirements and by controlling the competitive advantages, which mainly
bases on the options such as, customer loyalty, pricing, global presence, brand equity and
R&D.

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References:
Apple.com (2020). Apple. [Online] Retrieved from https://www.apple.com apple.com/
Clemons, E. K. (2019). Resources, Platforms, and Sustainable Competitive Advantage: How
to Win and Keep on Winning. In New Patterns of Power and Profit (pp. 93-104).
Palgrave Macmillan, Cham.
Gavetti, G., & Porac, J. (2018). On the origin of great strategies. Strategy Science, 3(1), 352-
365.
Molina-Azorín, J. F., Tarí, J. J., Lopez-Gamero, M. D., Pereira-Moliner, J., & Pertusa-Ortega,
E. (2018). The Implementation and Advantages of Mixed Methods in Competitive
Strategy and Management Systems.
Parast, M. (2017). Linking Operations Strategy to Competitive Priorities and Firm
Performance. In Academy of Management Proceedings (Vol. 2017, No. 1, p. 16316).
Briarcliff Manor, NY 10510: Academy of Management.
Purkayastha, A., & Sharma, S. (2016). Gaining competitive advantage through the right
business model: Analysis based on case studies. Journal of Strategy and
Management.
Straker, K., & Wrigley, C. (2016). The role of emotion, experience and meaning: The
comparative case of Apple and Samsung. In International perspectives on business
innovation and disruption in design. Edward Elgar Publishing.
Yun, B. S., Lee, S. G., & Aoshima, Y. (2019). An analysis of the trilemma phenomenon for
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