Introduction
Today’s survival in the increasingly competitive mobile devices’ market requires not only a business strategy but one that works for a company, which will enable the company to survive in the turbulent waters of cut-throat competition while remaining profitable. As one of the biggest players in the mobile devices’ industry, Apple needs easily executable but distinguishing strategies, and a business model that will enable it stay ahead of its competition. Additionally, the company will need to attain a competitive advantage, get a constant flow of resources and develop a culture that will enable it to distinguish itself from other players in the market. What therefore are some of the strategies required for adoption by Apple to attain competitive advantage and how will they be monitored?
Key among the strategies will be the development of highly innovative products. The mobile device market has many players, including Samsung, Sony, and Nokia, which are all producing devices that will compete with Apple’s products. It is therefore important that Apple release products that are distinctively innovative and different from the offerings made by its competitors. In essence, these products must be able to make a difference in the market and use the latest cutting-edge technology (Spence, 2013). With such high-quality products, it is possible to make higher sales at higher prices, in essence, making a return on investment.
Quality is key in the mobile device industry, especially when targeting the premium segment. Apple’s strategy should therefore include releasing products of marked quality that distinguish it from other players in the market. Quality in this case is in the materials used for making the devices, the design and the operating system. Quality, additionally, will involve a tighter integration of the range of the company’s products through a single platform, which in essence, ensures continuity across the product lineup offered by the company. Therefore, with quality, it is possible to establish a luxury brand that satiates the customers’ expectations (Spence, 2013). This will ensure constant and profitable flow of revenue to the company from both old and new customers.
With quality, it is possible to sell the products at premium prices, and continue the products’ reputation as luxury brands (Spence, 2013). Charging premium prices on the products is therefore another possible strategy. Through quality production and premium prices, the company gets higher profit margins, which in essence, increase the overall bottom line and company revenue. This strategy however, is closely integrated with spectacular product introduction and promotion. Therefore, the strategy takes a three-pronged approach in which the company produces high quality products charged at premium prices (Gupta, 2013), and given distinct introductions and promotions in the media. This is in addition to the product life cycles being fast (on a yearly basis), bringing in new features and performance enhancement on the previous products.
To achieve competitive advantage, quality will be crucial. Thus, using the strategy of premium pricing, the company must be able to justify the price through the offering of high quality products.Quality in this case is not only on the products’ design, but transcend to the software, hardware and customer support. Thus, even as competitors race to produce products with bigger screens and software gimmicks such as air gesture on the S5 by Samsung, Apple should ensure that the Apps and feature of their products not only enhance customer experience, but also offer quality in the very offing (Arora, 2013).
Another way to achieve competitive advantage for Apple is through the enhancement of the supply chain. Supply chain management remains an important part of the company’s production and competitive advantage. Given that the company itself does not manufacture any of its products, but does this through other companies such as Foxconn, the management of the supply chain is important for the company’s profit margins and timely delivery of the line of products. This is especially important since any mistake in the supply chain can cause product delays, missed sales and damage the company’s reputation and customer loyalty (Jubak, 2012). Therefore by assisting component suppliers to purchase new machines for producing the components the company wants, within the scheduled time and at a reduced price, the Apple will be guaranteed costs in the overall product as well as timely delivery of the products to customers; a strategy not used by any of the players in the mobile devices industry.
In addition to product quality and supply chain management, user experience and product integration will be another way of achieving competitive advantage. By ensuring that the customer experience is top-notch (Spence, 2013) while they are using the product, with fluidity in the product usage and paying attention to detail, Apple is bound to achieve customer loyalty. The focus on the customer ensures that the customer is not only satisfied with the product, but looks forward to purchasing another product from the company. The competitive advantage is even further enhanced by seamlessly integrating the company’s product lineup. Thus the iPhone, iPad, iPod and the Macs all form one integrated family of products whose difference is only in size and particular tasks they perform; the ecosystem remains largely similar (Magee, 2011).
Even with such strategies, culture and resources are important for the overall success of the company. A result driven culture in which employees can beat deadlines will be important for Apple. Given the fast product life cycles, the creative and innovative teams must be able to work fast to ensure that each new product delivers according to the promise that the company gives. This is in addition to a culture of continually seeking feedback from the consumers and acting on the feedback. Part of the culture also involves remaining accountable for every process and task given, with trained focus on few as opposed to many things at a time. This ensures that one gives their very best to whatever project they are working on (Lahinsky, 2011).
For resources, human resource is among the most important for the firm. This includes product designers, software developers, marketers and the company’s executives. The executives are important in making decisions that affect product lineup, launch and strategic partners and suppliers, while the designers are important in the production of the cutting-edge technology that drive the products. Other resources include the company’s patents and the brand name. The two are especially important as they give the company advantage over its competition. The company’s suppliers are also an important part of the resources owned by Apple including a strong research and development team.
Regular meetings with different product team and reports on the progress of the products under development will be some of the monitoring processes of the strategies’ implementation. This is in addition to customer feedback on products: the performance, problems and strengths of the products. The stock performance and financial performance will also form important monitoring indicators for evaluation of the success of each strategy implemented by the company.
Apple’s business model is one of both a wholesaler and a retailer. Thus, although the company manufactures its own products through contract suppliers such as Foxconn, it retains good relations with partners that include publishers, developers, cellular service providers, the entertainment and the entertainment industry, and it ensures that these products are seamlessly integrated with its software. The company’s line of business is therefore divided into the iTunes Store, Mobile Device and Computing hardware and Software. The three divisions are responsible for the company’s success.
References
Arora, N. (2013). Steve Job’s Perfectionism Lives on as Apple’s Competitive Advantage against Samsung. Forbes, 5 January. Retrieved from http://www.forbes.com/sites/greatspeculations/2013/05/01/steve-jobs-perfectionism-lives-on-as-apples-competitive-advantage-against-samsung/
Gupta, V. (2013). Samsung’s New Strategy is a Worry for Apple. Seeking Alpha, 25 November. Retrieved from http://seekingalpha.com/article/1860001-samsungs-new-strategy-is-a-worry-for-apple
Lashinky, A. (2011). How Apple works. Inside the world’s biggest startup.Fortune, 25 August. Retrieved from http://fortune.com/2011/08/25/how-apple-works-inside-the-worlds-biggest-startup-2/
Magee, D. (2011). Apple’s Competitive Advantage: Multiple Products that integrate as One. International Business Times, 21 July. Retrieved from http://www.ibtimes.com/apples-competitive-advantage-multiple-products-integrate-one-300605
Spence, E. (2013). Nine Business and Strategy Lessons from Apple and the iPhone 5c and 5s. Forbes, 14 September. Retrieved from http://www.forbes.com/sites/ewanspence/2013/09/14/nine-business-and-strategy-lessons-from-apple-and-the-iphone-5c-and-5s/