Role Major Key Success Factor For Apple Essay Example

wide range of products including tablets, mobile phones, cameras, televisions, and washing machines, creating a diverse product portfolio. The brand's reputation for performance and reliable after-sales service has further strengthened consumer trust. Samsung's flagship models, such as the Samsung S4 and S5, feature a standard hardware design and operate on the Android operating system (Bhasin, 2014; Armstrong, 2008).Pricing: Samsung uses a market planning pricing technique to charge high prices for its products at the beginning, in order to take advantage of profitable opportunities before competitors enter the market. For example, it initially charges high prices for its Samsung Note 3 at its debut phase. However, when it realizes that competition is getting tough, it decides to lower its prices in order to charge competitive prices using a sharp pricing strategy. This pricing strategy has been successful for its mobile phone products, but not for its home devices compared to its rival LG. Samsung then resorts to competitive pricing instead of pursuing a differentiation strategy in terms of design and technology.

Promotions: To increase the sale of its products, Samsung employs various forms of promotion, including offering benefits and discounts to its trade partners. Effective advertising is used to attract customers, while sales promotion is used for pushing the products.With its effective advertisement scheme, which has cost $770 million over the last two years (Dignan, 2014), the company has successfully competed against its rival Apple. To expand its product availability, it utilizes various channels in the market. These channels include the Sales and Service dealers, Modern retail, and distributors. The Sales and Service dealers play a crucial role in maintaining key accounts for the company and achieving

corporate sales (Bhasin, 2014). Apple has a unique and unconventional marketing strategy compared to other companies. In order to become a top player in the mobile industry, Apple avoids traditional marketing methods such as TV ads, newspapers, magazines, SEO, and social media. Instead, it relies on other companies to promote its iPhone products, who not only provide full support but also cover the promotional costs (Baker, 2008).These network providers are typically involved in promoting Apple products but they also face restrictions on the appearance and content of their advertisements, imposed by Apple ( McCormack, 2014). The segmentation of Apple products, specifically iPhone and iPad, targets customers who desire a unique and luxurious lifestyle. The organization captures the psychological concept of these customers by limiting the supply of iPhones, making them available to only a select few. This strategy piques media interest, as customers wait for days and weeks outside iPhone stores, resulting in free publicity for the organization (Promotion). Ultimately, the strategy of restricting iPhone supply creates two distinct groups of customers: those who own an iPhone and feel special as part of an exclusive club, and those who are deprived of it, experiencing envy and creating conflicts. These conflicts generate word-of-mouth advertising through forums, blogs, and other social media platforms (McCormack, 2014).To implement its Marketing Strategy, Apple uses the following Selling mix:

1. Merchandise: Apple provides its users with the IOS operating system on both Macbook and iPhone to ensure good quality over time. The hardware of the products is designed for efficiency and compatibility with the software, allowing the IOS to run smoothly. In addition, Apple operates its own music and application
   

shops, known as "iTunes" and "Apple Store" respectively, which are popular among users for their high quality compared to competitors like Google Play Store (Bhasin, 2014). These measures aim to differentiate Apple's products and provide a superior experience to customers (Nair, 2014; Moorman, 2012; W. Farris et al., 2010).

The organization is present in major cities of different countries, providing an excellent service for premium clients. Its I-Stores are mainly found in high-end locations and malls, and products are distributed to modern retail stores through a carrying and forwarding agent. The I-Store is the exclusive showroom for offering products at the best prices, as it receives them directly from the company with discounts. To prevent competition between stores, the organization enforces a minimum advertised price (MAP) on retailers by offering monetary incentives. In terms of promotions, while the organization mainly focuses on word-of-mouth advertising and media promotion to create desirability for its products, it also utilizes above-the-line (ATL) platforms such as radio, television, and magazines to target its premium clients.

(Perez, 2013; Easton, 2011).

Supply Chain Management by Samsung: Samsung has implemented a collaborative program to promote growth and stability among its suppliers. This involved shifting their growth plan to smaller companies and emphasizing green supply chain objectives. As part of this program, Samsung has established a win-win fund for partner companies, provided support for indirect suppliers, set up a joint technology development center, incorporated natural material price changes in purchasing prices, and implemented a temporary registration scheme to facilitate e-transactions. These efforts have resulted in maintaining a strong and loyal network of partners (Joel Wisner, 2015).The organization implemented a Collaborative Planning, Forecasting and Replenishment (CPFR) plan to improve its supply chain management. This involved partnering with various stakeholders to meet customer demand and resulted in cost savings in marketing, inventory, logistics, and transportation. Additionally, the organization made agreements with other companies to monitor market demands, gather customer feedback, and reduce operating costs.

Given the complexity of Samsung's global supply chain, the organization decided to implement a quality control program called Six Sigma. This initiative focused on aligning customer needs with products and services using lean manufacturing methods to improve profitability and reduce costs. To guide their Six Sigma projects, the organization followed the following principles:

1. Emphasize global optimization to ensure improvements are made on a global scale rather than locally.
2. Systemization is a critical component of Six Sigma.

Therefore, Samsung has maintained its position as a global leader in consumer electronics by implementing

supply chain improvement processes such as Fast follower, CPFR, and six sigma.

Supply Chain Management of Apple:

Apple's goal is to develop innovative solutions, and they are accelerating their product launches by acquiring third-party businesses and licenses. They also prioritize identifying potential quality defects, managing production incline issues, providing software for raw materials, maintaining appropriate inventory levels, determining launch quantity, making prepayments to suppliers to secure orders, resolving backlogs, reviewing inventory levels, adjusting demand forecasts, monitoring current sales levels, and tracking component cost trends.

In addition, Apple is considered more efficient than Amazon with a stock inventory turnover of 59 compared to Amazon's 10. Apple has one main warehouse in California, while Amazon has 28 warehouses across the country. Apple synchronizes data between its central warehouse and over 246 stores to achieve efficiency. (Supply Chain 247, 2015)The organization's main objective is to offer high-quality products to premium customers at premium prices, while keeping costs as low as possible. To achieve this goal, the organization has not only chosen overseas suppliers for production, but has also formed strategic partnerships with other manufacturers who understand its product differentiation strategy. In order to establish exclusive agreements with these suppliers in exchange for volume guarantees, the organization has set a formal list of expectations for them.

Building relationships with suppliers has allowed the organization to quickly scale its operations to meet customer demand for both existing and new products. Working with supply chain partners has also helped the organization develop innovative manufacturing processes. Additionally, by placing high-volume pre-orders and investing heavily in production capacity, the organization ensures that it has enough resources to meet demand while preventing competitors from

accessing the same manufacturing resources.

However, Apple has faced criticism regarding working conditions in its supplier's factories and warehouses.In 2012, the organization announced plans to resume production in the United States after a 10-year hiatus. Some industry analysts attribute this decision to rising prices for natural gas and oil in China, as well as other developments and decreasing wage gaps between US and overseas workers (University of San Francisco, 2015; C.M.Harland, 2005; Meindl, 2013; Horvath, 2001). According to Bloomberg Business (2011), Apple has created a closed ecosystem where it has control over nearly every aspect of its supply chain, from design to retail stores. This allows the company to negotiate significant discounts on components, manufacturing capacity, and air freight. The Apple Website (2015) states that the company is on the verge of integrating its employees to promote equality, human rights, and environmental respect throughout the entire supply chain. As part of their commitment to high environmental standards in manufacturing, the organization publicly shares guidelines and suppliers for all to see (Apple, 2015).

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