Comprehensive SWOT Analysis of Apple Company's Performance

This report presents a comprehensive SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of Apple Inc. It begins with an introduction to Apple's global influence and its product range. The analysis delves into the key opportunities and threats Apple faces, including competition from rival companies like Samsung and LG, imitation of products, rising labor costs, and government regulations. Opportunities such as the expansion of distribution networks, increasing demand for smartphones and tablets, and the creation of new products are also explored. The report then examines Apple's perceived strengths, such as its strong brand image, high-profit margins, innovation, and effective marketing strategies, while also addressing weaknesses like limited distribution, high selling prices, and over-reliance on specific products. The competitive analysis focuses on Apple's innovation, marketing, and distribution strategies, as well as its leadership style. Finally, the report concludes by discussing the potential direction Apple may take in the next ten years, considering both internal and external factors, and the need for diversification and adaptation to remain competitive.

Swot Analysis of Apple Company 1
SWOT ANALYSIS OF APPLE COMPANY
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Swot Analysis of Apple Company 2
Introduction
Apple is an American leading IT corporation that forms one the most existing profitable
and social influencing companies around the globe (Zich 2014). In the year 1976, Steve Jobs
came up with a computer oriented organization that later assumed the name Apple Company.
The company deals with the manufacture, production, and supply of varied products starting
from homes and business to entertainments sectors (Hands 2013). Due to its constant production
of high-tech items, the company has gained consumers satisfaction and loyalty in the whole
world. In this study, the paper reflects on the nature of the global technology business with a
focus on the critical threats and opportunities as well as the perceived strengths and weaknesses
that directly or indirectly affect the performance of the company. The paper as well reflects on
the competitive strategies adopted by the company with a focus on innovation because there are
many other global organizations such as Google Inc that offer stiff competition in the world
market. The paper concludes by evaluating the possible direction the company is likely to take to
remain sustainable and competitive in the next ten years of its operation.
Key opportunities and threats in the current environment of the Apple Inc
Although Apple Company has made it to the market share against other competitors, it
faces major threats such as; aggressive potential companies, threats of substitute products,
imitations and rising labor cost in other countries that host the Apple plants (Linick 2014). Many
businesses tend to copy the Apple products and launch them in the market, an imitation trend
that has made the company to have some numerous court cases. Such of the imitations are like
the replica case of Samsung, producing a similar Apple device caused both companies to end up
in a court tussle that has taken many years and caused billions of shillings. Such imitations have

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tried to create a bad image to Apple since many customers get disappointed when they buy and
later find out that it is a counterfeit. Such disappointments always reduce the customer
satisfaction hence reducing the client's loyalty to the company.
Rivalry among Companies such as Samsung and LG creates a stiff competition in the
market by producing cheaper products than the Apple’s products (Linick 2014). The low cost of
the substitute products such as LG and Motorola tends to offer stiff competition to the Apple’s
products hence reducing the sales of the company. The competition makes the Apple Company
struggle to keep the pace and being the most market commander in future. Such competition
always drops the sales of a company, hence may alter the market share percentage if not well
addressed.
Apple has launched its plants in other countries such as China that laid many policies
known as Foreign Enterprises Income Tax Law to protect domestic companies, provided less
preferential policies for the foreign enterprises (Schulte 2011, p. 8). The Chinese system offered
a platform for piracy; this made Apple face more risks on Apple products in China. China did
also charge a high rate of license on the foreign enterprises. These high fees propagated the
increase of running cost of Apple firms to be greater than the income making them unstable in
the local markets. Both the high degree of government charge and reduced sales tends to reduce
the profit level and increase the Apple’s dominance in the market may not last long form such
stiff competition from Samsung since the market command gap is small

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Opportunities
Apple Company has potential opportunities that determine its future. They are also known to
involve various external factors such as the expansion of distribution network, increasing
demand for the tablets and Smartphones, and the creation of new products (Korkeamaki &
Takalo 2012).The unavailability of Apple’s products to lower class people gives the company a
better opportunity to develop new affordable products and expand its distribution network to
reach the lower class. The company can achieve this through making more simplified products
such as Apple watch, which is profitable to the lower class people. The move will not only
expand its innovativeness but will also increase its market command with other competitive
companies such as Samsung.
In a systematic review, Lynch (2011) points out that this Taiwan semiconductor
manufacturer a renowned Taiwan company that leads in fables semiconductors producer is
believable to be the only supplier of the A1 Fusion chips used in powering the series of the
smartphone on Apple’s current iPhone 7. The same study denotes that it is the sole manufacturer
of A10XFshion chips created within the Apple’s newly released 12.9-inch and 10.5-inch iPad
Pro models. However, it is as well expected to be the only manufacturer of the A11 Fusion
processors used in powering iPhone 7s, 7+, as well as the premium OLED iPhone. With all these
chances and market opportunities in the iPhone products, the company has attracted more
investors who view that the company has much more opportunities to improve in the productions
and distribution in the entire market making it more and stronger.
In another study, Korkeamaki and Takalo (2012) denote that the company has a record of
high-performance computers. Starting with its 7-nanometer generation of technology, the market

Swot Analysis of Apple Company 5
for high- performance computing devices has proven to be in real growth. The company is a
contract manufacturer, therefore, does not design products for specific market segments but
instead develops various manufacturing technologies, an aspect that many technologists value as
a marvelous canvas in the technology business. Linik (2014) also denotes that market is full of
customers who are aggressively going for the high-performance products in the market such as
virtual reality, deep learning accelerators, as well as data center processors among others.
Apple’s market share has increased due to the introduction of the iPhone that had numbers of
consumer electronic features. These aspects peg the total addressable market for the company
between $10 billion to 11.5% in 2017, but us as well expected to grow with a margin of 10%
annually.
Perceived strengths and weaknesses of the Apple Inc
Apple’s strengths lie on the internal strategic factors that are the high brand image, high-
profit margin, and effective innovation process and strong market strategy. Apple’s brand is one
of the most powerful and most popular in the world hence it has enjoyed high profits from a
large volume of sales made per annum through strategically maintaining the premium
price( Toth 2016). The constant rapid, innovative strategy of apples enables it to keep at par with
the fast development of technology pushing them to launch new products’ into the market. The
strong brand image makes the company successful in introducing many of the new products
without fear of disappointing their customers. Apple App Store that offers a marketplace for the
customers to buy applications for the tablets and computers, hence preventing entry of malicious
applications to the products.

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The internal strategic factors that cause Apple’s weaknesses are such as limited
distribution, high selling prices of the products and limited sales to the high-end market (Wright
2012, p. 90). Apple Company has an insufficient distribution network that causes by the
company’s restrictive policy. The same study as well denotes that the company tends to exclude
some of the retailers and prefer specific ones. With that system, there is reduced distribution
channel of the enterprise. Hence the products are not reachable to other people who may want to
buy them. The selling strategy of the Apple Company is directed mostly to specific classes such
as the upper and the middle. The approach makes the products to be more expensive than the
lower class cannot afford. Therefore they experience limited customer target.
Apple has always depended on the sale of iPhone that has increased in the few years to
about 52% in 2015 as pointed out by Zich (2014, p. 45). Overdependence on one product makes
it vulnerable to changes in the Smartphone market since its products targets only the well-off
individuals and developed regions. For Apple to avoid revenue challenges in the future, it must
introduce new cheap smartphones such as smart-watches and others to maintain the changing
emerging economies.
Competitive Analysis of the Company in the innovation perspective
The apple marketing, advertising capabilities and great budget of over US$ 2 billion that
has continued creating awareness of the brand have created an increase in demand (Linick 2014).
The marketing and advertising strategy of not selling the products but inviting the customers to
come and experience the Apple lifestyle and become the part of the iPod community have helped
in catching more customers. The company has trained its staffs, not to major on selling the

Swot Analysis of Apple Company 7
products rather than they should focus on building on customer relationship and trying to make
their lives more enjoyable.
The leadership style that has been practiced by Steve Jobs has also led it to achieve
employees confidence as pointed out by Schulte (2011, p. 89). Steve Jobs ensured a strong
corporate culture among all the staff, whereby they are required to be innovative, fast-paced, and
committed to the tasks. Apple initially depended on the potential retail shops to distribute their
products, but it opened up a store lately like in Tysons Corner (Wright 2012).The locations of
most of the stores are in high-traffic positions hence able to reach to more customers hence
making more sales. Evangelism of the company’s products has helped it to gain more access to
more customers. The company’s successful evangelism from dedicated employees, retailers and
potential customers has contributed to spreading the Apples good gospel to others. Hence apple
was able to create what is called “Mac cult” to refer to loyal customers (Lynch 2011).
The vertical integration of Apple Company is very efficient that can manage four
separate businesses, which are hardware, software, service and retail providers with ease (Zich
2014). The single control of all the supply chains makes it more prominent since there is no other
company can do that with ease. The active Apple’s distribution channels in the United States
have earned it the market command it is enjoying currently (Hands 2013). The company has
multiple distributions channels that deliver the products to customers with the shortest period
possible. It has also built many retail shops and storage shops on various busy streets to ease the
accessibility by clients. Apple has great indirect distribution channels like the Amazon Market
that assist online purchases. For the company to achieve global market command in future, then
it has to increase its stores and plants in all parts of the world.

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Diversity on innovation has made the company to grow to the current situation
(Korkeamaki & Takalo 2012, p. 9). It started by producing computers and then later diversified
its innovativeness to a large number of attractive items such as iPhone the latest mobile phone.
The simplicity of the Apples’ products has attracted so many customers more than the substitute
products. The company focuses more on improving complicated items and making them easier to
use. Just like it never invented the PC, the Mp3 player nor downloadable music but, Steve Jobs
borrowed the ideas from companies like Sony and improved on them to simple usage methods.
The direction of the Apple in the next ten years
According to SWOT analysis, Apple future lies in both the external and internal factors
that dictate its daily operations (Zich 2014). The external factors include political and legal,
economic, socio-cultural, technological, global and demographic factors. The economic factors
dictate the future by offering a wider market for its products. The company will only survive
when it proves to be stronger than the competitors; this is achievable through the production of
more varied price friendly products that are distributable to less economical regions. With that
move, there will be an increase in both the Apple productions, sales and market coverage hence
making it stronger than competitors. The socio-cultural factors keep on changing everyday as life
becomes more and more digital. Since computers and phones have become part and parcel of
life, their demand have increased and still continue to do so in most of the homes, government
institutions, schools and even in personal life increasing the opportunity to produce more
products in the next ten years( Linick 2014). The technological increase in the globe dictates all
the stake holders to update their game to meet the customer’s preferences. Apple‘s capability to

Swot Analysis of Apple Company 9
design customized products to customers makes it more preferable to the market with young
individuals who are more conscious to colors, features, and sizes.
The entry of strong competitors and existent of such companies like Samsung, Dell, HP
continue making access to customers more than Apple firm (Linick 2014). The firms are
providing varied and cheap products that are with features related to the Apple phones. These
products are more marketable in the less economical regions hence creating a stronger market
than Apple’s expensive products; as a result, the future market command of Apple will weaken
and probably get displaced. The future solution of the Apple firm lies on diversifying their
products that are less expensive and varied to strengthen its consumer electronic market.
The internal factors that see the future success of Apple are like the strong management
team, which has outsourced most of the manufacturing and logistical that have and are
continuing to aid the success of Apple’s distribution of products to the potential market (Zich
2014). Another internal factor is the financial stability of the company which makes it stronger
even in the competitive market. The innovation spirit of the staffs and employment of the “Think
Differently” philosophy has enabled it to be realistic in the future market as they are producing
new consumer electronic products (Schulte 2011). The focused advertising strategy of Apple’s
firm having been productive and will continue. Apple spent a lot of money more than any
competitor to build its image and reputation therefore with their financial stability they are very
capable of doing everything to continue and increase what they are in the next ten years.

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Conclusion
From the above analysis, it is evident that there is a stiff competition in the global market
on technology and related innovations. It is hence necessary for every company to adopt
strategies that can ensure it stands out in the market. Despite the still market competition, Apple
has a significant market share, an advantage that it enjoys since it is the sole producer of various
iPhone products in the global market. As a result, it has attracted more investors as well as
customers who value its high performing products.

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List of References
Hands, A, 2013, Tech Services on the Web: Apps for the IPHONE (Part One)
http://www.apple.com/iphone/. Technical Services Quarterly, 31(1), pp.79-80.
Korkeamaki, T. & Takalo, T, 2012, Valuation of Innovation: The Case of Iphone. SSRN
Electronic Journal.
Linick, M, 2014, Measuring Competition: Inconsistent Definitions, Inconsistent Results.
Education Policy Analysis Archives.
Lynch, P, 2011, iPhone Apps for the Workplace. Biomedical Instrumentation & Technology,
45(1), pp.10-11.
Lynch, P. (2011). iPhone Apps for the Workplace. Biomedical Instrumentation & Technology,
45(1), pp.10-11.
Mohammad Arabzadan, S, 2012, Improving Project Management Process in Municipality Based
on SWOT Analysis. International Journal of Engineering and Technology, 4(5), pp.607-
612.
Schulte, C, 2011, Book Review: iPhone and IOS Forensics: Investigation, Analysis and Mobile
Security for Apple iPhone, iPad and IOS Devices. Journal of Digital Forensics, Security
and Law.
Tóth, G, 2016, Az Apple titok, avagy mitől szeretetmárka az Apple? = The secret of Apple, so
what makes Apple a lovemark?. E-conom, V(1).

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Wright, A, 2012, Analyzing Apple products. Communications of the ACM, 55(1), p.27.
Zich, R, 2014, Analysis of company success potential from the point of view of success-ability.
Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 57(6), pp.343-
350.