The Competitive Advantage of Apple Inc

Background of Apple Inc

Apple Inc is a international information technology corporation based in California, USA. The company produces consumer electronics, individual computers, and software. It is one of the largest IT corporations in the world which is often painstaking as one of the successful start-ups of all time. Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne. The first personal computer named Apple I went on sale in the year 1976 and it was essentially just a motherboard.

During the first five years since the company had throve, the revenues went double every four months. In the year 1977, Apple II individual processor was released. As opposed to the other computers, Apple II stood out due to its usage of cell-based color graphics. This computer featured an integrated keyboard, plastic case, and eight internal expansion slots. The company has also strained to gain a purchase in the music streaming business which has expanded by 51% in 2013 and the music designers declined by 2.1% according to the International Federation of the Photographic Industry. The total number of employees of Apple inc is 147000 as of 2020. The number has increased by 7.3% from 2019. Similarly, the revenues have augmented by 53.63% to $89.58 billion during the first quarter of 2021. This article covers a detailed explanation of competitive advantage of Apple.

The competitive advantage of Apple inc

Apple Inc is one of the most reputed brands in the USA. It functions on the global stage and caters to multiple product categories starting from iPad, iPhone, laptops, and desktops. Further, they operate on digital television and entertaining services over the years. Apple has expanded its business by diversifying the value influence and concentrating on upholding of business image. As of 2019, Apple has earned revenue of USD 260 billion which puts the company ranked 4th  among other peers. The firm also holds a leading position in terms of market capitalization, valued at USD 3 trillion. The fiscal statistics of the corporation highlight the company’s effective growth and success rate. This as a result has helped the firm to create a strong position against Apple competitors.

Since the organization operates in the technological sector which is rapidly growing at present. The industry growth and prospective are consistently drawing forward the new market players. These market players consistently seek to offer more attractive value propositions to the customers and pose strong competition to the other market players like Samsung. The competitors of Apple, like Samsung, are continuously trying to outpace the company by introducing new products and services like a new type of smartphone, watches, etc. All of these can create a strong impact on the minds of the customers. Hence amidst the steep competition, the company has still been able to maintain its position in the market through a strong modest benefit. Apple competitive advantages allows the company to distinguish itself from other marketplace companies in terms of value creation. The Porters Generic strategies can be suitable to assess the competitive advantage of Apple inc.

Figure 1: Competitive advantage of Apple inc

The above diagram shows the highlights of Porter’s Generic Model. As per this model, the organization can achieve modest benefit through four dissimilar plans like cost leadership, differentiation, cost emphasis, and change focus. Apple competitive advantage is achieved through differentiation strategy.

Using differentiation to gain Apple competitive advantage

Apple inc has significantly used the differentiation method to gain a modest advantage. A closer look into the firm’s business processes reveals that the organization has strictly followed the differentiation strategy to distinguish itself from the broad market score. The first differentiation which the company has comprehended is its brand development over the years. Based on the Apple competitive advantage, the company has created a strong brand image that is focused on quality, ease of use, and user knowledge. The strong brand loyalty among customers has also been framed by Apple to gain a competitive benefit. All of these have translated in terms of brand justice. Presently the company ranks first in terms of brand value with a valuation of USD 260.2 billion. The strong brand image sets a platform for the company which helps to discriminate themselves from other peers in the market. Hence when it comes to brand image, Apple inc is quite spoken about its uncompromised promise of user-friendly crops and services. Further, the robust brand image of Apple inc has kept them aside from offering identical products. The differentiated brand image of the company has helped the customers to have top-of-the-mind brand recall which is extremely crucial for making brand preference before opting to purchase Apple’s product. The user-focused approach has helped Apple to be established as a premium brand in the technology-based product segment. The company also targets premium customers for selling their products which cater to the niche market segment. Since the company is a premium brand, the customers are ready to pay more for the product like iPhone and laptops. In this way, the company has been able to create a strong Apple competitive advantage from its sole brand image. The real brand image of Apple thoroughly communicates the greater product quality and higher ambition worth.

On the other hand, the modest benefit of Apple inc is also made from its product design. The business has always focused on making an experience for the patrons rather than just selling products. Hence Apple Inc.’s products are designed to offer better experiences than its rival products. To generate a single and outstanding skill, Apple devices are driven by their own exclusive working systems. The user border has been industrial in such a way so that it is strikingly different from the other market players. The iOS on iPhones is different from Google's Android. Similarly, the MacOS on the Mac computer is dissimilar from its competitor Microsoft Windows. The company also develops its own set of mobile processors to generate an unmatched performance and better level of optimization with its software. Apple also makes sure that they bring varied and more enjoyable experiences for the clienteles.

The client knowledge is further distinguished finished the creation of a creation bionetwork. Over the years Apple has intended its crops in such a manner anywhere the customers can generate better business insights and values with its Apple products. Smart devices like  Apple iPad, iPhones and Apple Watch work seamlessly together to generate a better business experience. The product ecosystem has helped Apple Inc to strengthen the differentiation process even further.

Premium pricing strategy

Apple has ensured a premium pricing strategy to gain business superiority. If it is compared to other brands which are having equal specifications such as Samsung, Asus, HTC, or Xiaomi, the price of Apple is much higher. Many people argued that the value is high and it is outside the spread of people. But Apple has been able to meet its competitive market strategy through its high pricing. It creates an image that the individuals of Upper-class culture can have these crops.

Innovative products of Apple Inc

Issues such as ground-breaking products, the permanency of product life, sole operating system, and overall quality have helped Apple inc to gain faith among their users. It has been able to make a higher ostensible value. As a result, the company has been able to achieve a competitive edge that contestants like Samsung have not been able to generate.

Conclusion

The company believes that once a person buys Apple products will never shift to other products. The devices of Apple are unique and easy to use. Conversely in the android phone industry, there are many companies likes Samsung, Xiaomi, etc who produces android mobile phones. The difference between iOS and Android is that android is an open-source operating system. Hence if any person buys an iOS device, the choice is Apple only. In this way, a strong Apple competitive advantage has been developed.

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