Apple Computer Essay Example

Apple experienced an approximate reduction of 80% in its gross margin. Consequently, the SO/sales ratio declined from 28% to 16%. Additionally, net income decreased from a gain of $310 million in 1991 to a loss of $816 million in 1996 – indicating a recession for the company. Nevertheless, between 1998 and year end-2000, there was significant improvement in Apple's gross margins which reached up to 28%. Sales also showed substantial growth during this period amounting to y83 million (although they had nearly reached the billion-dollar mark back in '96). It appeared that Apple successfully navigated through the recession between '96 and '97; however losses resurfaced again for them in '01.

Overall, Apple displayed varying financial performance throughout the years from1981 to2001 alone with their market value experiencing an alarming decline of $40 multimillionf by the end of '96.

From '98 till '99, Apple witnessed a remarkable increase of $8510 million in its market value. The company follows standard human resources management practices, which encompass specific sections for recruitment, hiring, training, and employee retention. In terms of recruitment strategies, Apple focuses on attracting talented individuals who align with their goals and meet labor demand forecasts. They employ various methods such as online recruitment (E-recruitment), university outreach programs, internships, and the Apple store leader program. Throughout the recruitment process, Apple utilizes an online application system and conducts interviews while ensuring equal employment opportunity and adhering to Affirmative Action policies.

Regarding training efforts, Apple motivates employees to complete their training by incorporating new technology and offering career advancement opportunities that enhance their professional knowledge. To retain high-quality employees, they prioritize creating a fun and innovative work environment alongside maintaining a fair

selection system. Moreover, Apple provides excellent benefits including health insurance, life insurance, assistance programs, and product discounts as part of their employee package. Working at Apple involves contributing to the creation of top-notch products and helping people discover amazing things.Apple's marketing efforts are aimed at home users, educational institutions, and business professionals in various industries. They provide suitable options for home users seeking faster performance and ample storage in all-in-one computers. Additionally, they develop tools like Cut Pro to empower professionals such as graphic designers, movie/TV professionals, and musicians.

Apple targets college and high school students, as well as educational institutions, offering discounts on their computers. Their goal is not only to attract new customers transitioning from Windows but also to keep their existing customer base satisfied with stylish computers and stable operating systems.

Their product line includes iPads, iPhones, Macs, software, and accessories known for trendy and innovative designs. As a premium brand in the PC industry, Apple caters to customers who are less price-sensitive but must be cautious about compromising their brand image and company culture by targeting all customers.

Apple sets different price ranges for each product based on the offered storage capacity according to the preferences of CEOs. The unique features of Apple's products give them a competitive advantage in the electronics market. This allows them to expand their target customer base and entice customers into purchasing their products for exceptional experiences.Apple offers three computer models: MaMacroir, MaMacroro, and iMImax. The MaMacroir and MaMacroro models come in two sizes, each with two types of storage available. Conversely, the iMImax model is available in five different types, which vary in size and memory capacity. Each

product type has its own specific price.

During the introduction stage of the product life cycle, Apple implements a skimming pricing strategy compared to its competitors. To promote their products, Apple heavily relies on advertising through various mediums such as TV commercials, websites, magazines, and even building walls. They also create targeted advertisements for different regions like China, Japan, and Europe. These advertising efforts not only help maintain sales but also attract more customers.

In addition to traditional advertising methods, Apple also offers a "Back to School" promotion specifically for students and teachers. This promotion provides a $100 bonus for applications in addition to their purchase. Furthermore, personal selling plays an important role as a form of promotion at Apple's retail stores.

However,some customers who are unfamiliar with Apple's products may feel overwhelmed or dismissive when visiting the retail stores. This is where salespersons play a crucial role by providing valuable information to customers and ensuring their long-term satisfaction.Retail stores play a crucial role in facilitating customer interaction with Apple through face-to-face services."When customers enter an Apple store, they can expect friendly and knowledgeable salespersons who have received extensive training in product information and customer service skills. These salespeople are always ready to assist customers with purchases or provide additional information. They do this by addressing inquiries patiently and politely, building strong customer relationships and improving overall satisfaction.

To cater to customers' need for hands-on experience and insights into their innovative products, Apple offers online and call-in services globally. This ensures convenience for customers with simple queries or time constraints that prevent them from visiting physical stores.

In terms of distribution channels, Apple primarily sells its products through its websites,

retail stores, well-known electronic or computer stores, and third-party wholesalers. The company also showcases its problem-framing and problem-solving capabilities by addressing various issues across a wide spectrum.

While Apple takes pride in its ambitious and innovative product offerings, it has faced marketing challenges over the years. From 1980 to 2001, the company experienced an 81% decrease in market share which resulted in a lack of software support.In addition, Apple's competitors have managed to replicate and surpass their system, resulting in a loss of competitiveness. To regain market share, Apple needs to enhance its competitive advantages and position itself as a niche player in the PC industry. Despite having attractive design, graphics, and user-friendliness, Apple's market share is hindered by the lack of special functions in programs like Words, PowerPoint, and Excel. In order to surpass competitors in the future, Apple should evaluate the demands of PC users and update their software and operating system. However, this may be challenging for Apple due to intense competition in the PC industry and an unstable economy.

One strength that sets Apple apart is its innovation strategy. This can be seen not only in their stylish products but also in their business model. All Apple products run on the same operating system which allows them to easily connect with various electronic devices such as iPhones, iPads, and iPods. This connectivity attracts more potential customers and encourages them to purchase multiple Apple products. By anticipating future customer demands and creating new products like iPads and iPods, Apple increases revenue and gains loyal customers. Their innovative approach enables them to identify new opportunities and select the most profitable options.

Furthermore, one aspect that distinguishes

Apple's operating system from others is its stability.Mac OS, known for its visually appealing GUI and strong security features (Amy 2011), operates on a two-layered system. The preconfigured and customizable firewall effectively protects against viruses like Trojans or rootkits, unless the user grants root access with an administrator password. Apple's tight control over the operating system ensures compatibility between components, resulting in reliable performance on their computers.

Apple has established a strong brand reputation for creating innovative and well-designed products, as evidenced by their high value in the 2014 BrandZ Top 100 Most Valuable Global Brands ranking. Customers can easily find Apple products like the iMac through numerous distribution channels worldwide, including retail stores and online platforms.

However, there are weaknesses that Apple faces. One weakness is the lack of a robust sales forecasting method for the PC market. Additionally, limited differentiation from Microsoft's widely adopted Windows operating system makes it challenging to convert regular users to Mac OS. These factors contribute to lower returns on sales compared to competitors like Dell and IBM due to Apple's low market share.

Despite these challenges, there are opportunities for Apple to leverage its experience and development spending by developing new products for different customer segments. One potential opportunity is implementing a build-to-order manufacturing model.Research has uncovered new functions of Mac, providing an opportunity for Apple to showcase them to customers. To take advantage of this opportunity, I propose that Apple adopts a build-to-order model, allowing customers to choose which functions they desire. This would benefit those who appreciate Mac's design but do not require professional features, reducing expenses for customers and giving Apple a competitive edge in the highly price-driven

market. However, there are threats within the mature PC industry where computers are continuously improving performance while maintaining affordability. Competitors operating on the same computer platform have an advantage over Apple's proprietary platform as they can offer lower prices to attract both customers and suppliers. Moreover, with the emergence of substitutes like the iPad, demand for traditional computers has declined. These substitutes possess the ability to perform basic computer tasks such as video watching, gaming, music listening, internet searching, and email sending with Word, Excel, and PowerPoint functionalities. Additionally,
these alternatives are more portable and convenient compared
to Mac computers. As a result of their market advantages, these substitutes pose a significant threat to Apple's market share and hinder its position as a frontrunner. In response to this challenge, Apple has launched a $100 million advertising campaign for their largest ever product called iMImax.

The campaign has been a success, selling 278,000 iMImax units in the first week. However, the current ads only focus on showcasing the physical appearance and differences of the computers instead of highlighting the capabilities of Mac OSSO. To address this issue effectively, new ads should emphasize how Mac OSSO can benefit users in various aspects such as studying, working, and playing. These tailored ads for different target segments including Home users, Business users, and Education sector will show every PC user how iMImax is designed specifically for them.

Although Apple doesn't consider itself a software company nor plans to introduce its own hardware brand into the market, it should still consider licensing Mac OSSO. This way Apple would maintain control over the software ensuring exclusive compatibility with Mac products while also having sole

authority in updating it. However, Apple's competitors are offering aggressive pricing and low-cost options which may make Windows compatible with other computers and offer more resources for system updates.

According to David (2009), Apple's development of its own software for its products could potentially harm developers like Google and Adobe. This raises concerns for Apple as they consider the Mac OS crucial for their future success and do not want to license it fearing a negative impact on their position as a hardware industry leader.However, Apple should acknowledge the potential to benefit from its popularity as a technology brand by utilizing the Mac OS as a gateway for consumers to purchase other Apple products. Additionally, Apple's usage of computers in the business world has been unsatisfactory and their current strategy lacks a clear solution. The emergence of a new Windows system necessitates collaboration between Apple and software designers to develop more business applications that are compatible with the Mac OS. These applications need to be both distinctive and functional considering the lack of compatibility between the Mac OS and other systems. To address this issue, one suggestion is for Apple to possibly create an environment within the OS where the Windows system can run. While it remains uncertain whether this will happen, it would be a positive step towards eliminating some reasons for managers to switch to Mac.
Furthermore, there is an alternative strategy proposed in the consequence table that suggests boosting market share by upgrading advertisements, attracting new customers, and stimulating demand among PC users in order to tackle Apple's low market share and positioning problem. Alternative 2 aims to prevent Mac OS from losing dominance

by entering a new hardware market and cutting costs. Alternative 3 focuses on enhancing Apple's position as a professional PC, maintaining relationships with existing customers, and clarifying the functions of Apple's computer in different markets.Based on this analysis, it is recommended that Apple continues to focus on targeting business users. This is crucial for Apple as it helps regain its position in the business world and introduces Windows users to the user-friendliness of Macs. It is recognized that Apple has potential in developing new products for business users and should seize these opportunities. The computer industry's most significant target market is the business world, so changing strategies towards business users can yield substantial results. Furthermore, this could rapidly increase market share since there is greater demand from businesses compared to individuals. If satisfied with Apple computers' functionalities, business users will incorporate them into their daily lives.

From a global perspective, there has been significant growth in the PC industry as computers have become essential tools at work and home. PC sales witnessed rapid growth from late 1900s through the 1990s but declined due to advancements in technology and increased competition. Factors such as internet access and computer substitutes also played a role in this decline as businesses and households held onto their computers for longer before replacing them.

However, between 2000 and 2001, there was another decline in PC sales which have since rebounded. In 2004, there was an increase of 8.3 percent in PC sales in the US and an overall worldwide increase of 11 percent.
The growth of notebook computers and developing countries has contributed to the expansion of the global market. The reduced labor costs

for PC manufacturing in North America, Europe, and Asia make it an attractive aspect. Initially, American PC companies focused on Japan due to its low labor cost and proximity to the US, but they later expanded into Asia. It is crucial for companies to consider global market operations as they are influenced by worldwide economic conditions. Fluctuations in employment rates, negative financial news, declines in income or asset values can negatively impact demand for products or services. Furthermore, fluctuations in prices of internationally sold goods and services can affect demand as they balance out the strengthening of the U.S. Dollar. Various factors such as fuel costs, mortgage markets, labor costs, consumer confidence, and other macroeconomic aspects influence consumer spending behavior which impacts demand. Apple entered the global market in 1980 after being founded in 1976 and became a major player with around 45% of sales coming from outside the U.S. In particular, Apple achieved significant success with a 14% market share in Japan by targeting that region and focusing on China's rapidly growing computer market at that time (David, 2005).In 1996, Apple faced tough competition from FuFajitas and price-conscious consumers due to advancing technology. However, they consistently introduced innovative new products and technologies with unique designs and reliable system products. This made competition not a long-term threat.

By the end of 2010, Apple had obtained profits from the global market and employed over 45 thousand full-time employees worldwide, including about 3 thousand employees from different regions. According to their 2010 report, annual sales reached approximately $67 billion through worldwide operations.

The success of Apple in the global market is attributed to their unique design and high-quality products,

as well as leadership and differentiation strategies. As previously mentioned by ORROAMorporate advisors CEO Ryan O'Ramseyarrett, Apple's products have revolutionized business practices with simple yet sophisticated design and interfaces.

To strengthen its global presence, Apple employs various strategies such as outsourcing, importing, exporting, foreign licensing, and foreign direct investment. For instance, they established a factory in China for iPad production which resulted in significant success (Apple Inc., 2010).However, it should be noted that this strategy may have a negative impact on unemployment rates within their home country. As of April 2014, WiWisped reports that Apple had a total of 425 retail stores spread across 16 different countries with an additional online store serving customers in 43 countries. In the second quarter of fiscal year 2014, TABLE1 shows that Apple's worldwide revenue amounted to $45,646 million dollars indicating a growth of 4% compared to the same period in the previous year. The graph below displays the breakdown of revenues across six regional segments that make up Apple's business. It is important to note that only one-third (33%) of Apple's recognized revenue was generated within America. Despite performing well overall, Apple heavily relied on overseas markets for much of its revenue.

To address concerns related to outsourcing jobs abroad and rising labor costs in developing nations, President Obama announced in 2012 that Apple would bring some outsourced jobs back to America. This decision was seen as a display of national pride and a strategic move to maintain positive public sentiment towards the company. Although this shift may slightly impact profits, it will significantly enhance Apple's reputation.

Considering all these factors, there is still substantial potential for Apple to continue developing

products for the global market.Corporate social responsibility is essential in shaping the perception of companies by their target audience. When deciding where to spend their money, customers often consider a company's initiatives focused on social responsibility. There are two main types of corporate social responsibility: providing financial support and resources for worthwhile social causes, such as donations and charities; and creating a concrete plan to prioritize the well-being of society, including employee safety and environmental initiatives (TrTruism2013). Businesses that aim to maintain a strong commitment to social responsibility face the challenge of demonstrating genuine dedication in their operations. Utilizing recyclable materials in products is one crucial aspect of this commitment, as it helps protect the environment. Companies also need to take evident CSR actions to safeguard their brand and establish a positive company image. Public relations play a significant role in shaping consumer perception and maintaining favorable relationships with the government (TrTruism2013).