Apple, Inc. Case Study

1711 words - 7 pages

Brief Overview of Apple
Apple, Inc. was formed by Steven Jobs and Steven Wozniak in 1976 (Mrak-Blumberg, Renery & Bundgaard, 2006). Both had developed interest in electronics in their high school years, and upon graduation, found themselves working for major companies. Jobs worked for Atari, while Wozniak was employed by Hewlett-Packard. Wozniak designed the first Apple computer named Apple 1, which made its debut in 1976 but like most new products, was received with skepticism. However, 1977 that would prove a defining year in the success of the company with the launch of the Apple 11 computer, which impressed the audience at a local fair as the first personal computer to feature color ...view middle of the document...

This is generated by quality marketing on part of Apple, and the long standing tradition of high-end technology, which creates a difference in status for Apple products. The company is also fashionable among the youth as it targets youngsters from 13 years and above with products such as the iPad. Income levels of consumers may also impact negatively the supply and demand of Apple, especially because its prices are rather higher. This may diminish the purchasing power of a lot of customers and, therefore, impact demand, which will affect the supply of these products.
An example is the global economic recession, or an increase in price in essential commodities such as milk and bread, which may force customers to withhold extravagant spending. Market expectation by Apple also impacts the supply chain. If consumers discern that prices are likely to go up for the iPhone in a week, they are Likely to purchase in the present, numerous iPones to avoid higher prices in the future, and this will increase demand. On the other hand, if Apple discerns from its forecasts that consumers are likely to spend more on during Christmas, then supply will be increased to meet this projected demand.
Market Structure
The market structure of Apple can be characterized as oligopolistic, duopolistic, and most recently, monopolistic. It has been mentioned previously that Apple operates different products and services across the communications industry. It is oligopolistic within the smartphone market, rivaled only by Google android and windows mobile. In terms of computer operating systems, its market structure is duopolistic, rivaled only by Windows. In recent years, the copay has monopolized branded computer market due to increased brand loyalty from its customers.
Marketing Tools
Apple has always utilized price skimming in selling its products. This is facilitated by increased awareness due to promotional tactics, which leads the consumers to anticipate the entry of particular product. Therefore, Apple is able to sale more of its products in the short-term at higher prices, and capitalizes on overheads in the long-term. Pettinger (2013) provides the example of the launch of the iPad tablet whereby it was priced at $700 which has since diminished to about $400. The application of premium pricing was also to promote the notion that Apple’s quality was supreme compared to other products. Non-price competition by Apple is characterized mainly in the manner in which it promotes its products so as to build competitive advantage. According to Mooorman (2012), one of the company’s principles is he understanding that customers judge a book by its cover, and, therefore, Apple eliminates this weakness by creating innovative products with enormous digital compatibility ad extended lifespans. The company uses advertisements both print and electronic to convey their band message, which favors their pricing strategies. The fact that Apple is big brand means that it has the...

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