How Apple’s Corporate Strategy Drove High Growth
Many companies tend to engage themselves in a head to head competition among themselves in a quest for a sustainable and profitable growth. Blue ocean strategy is, therefore, a method which most companies these days use to ensure that they strive to eliminate competition completely. It is a strategy which poses a challenge to the regularities of a healthy competition hence making the competition irrelevant due to the creation of new markets for their products. Apple Company has over the years also employed the use of the same mechanism. It does this by designing unique products which no other company can devise. A case in point is the Mac operating system, iTunes, and iCloud services. All these components are exclusively Apple products, and no other company can either access or manipulate the products. These products have given Apple Company a head start in the technology industry where clients are assured of the safety of their products when lost through remote controlling from iCoud, and they are assured of zero invasion of their phones by viruses through secure file storage at iCloud. Apple Company incorporated blue ocean strategy which geared their routine towards simultaneous differentiation and low costs of their products. They have based their efforts towards producing quality products which they sell at a relatively affordable stable price.
It is true that Apple Company incorporated blue ocean strategy. Actually, with the launch of iTunes, Apple Company launched a blue ocean strategy by designing a new platform which impacted a great change in the music industries. This music platform has dominated the industry for more than a decade now. It has made file sharing across the world very easy and efficient for everyone in the whole world. With the trend becoming very vivid in the music industry, it became clear that the digital music era had come to the fore. People could easily download music from the internet faster, and the music artists could find a platform where they could advertise their products to many people around the world making it very easy for the music albums to sell and make more profits for them. The incorporation of the strategy was, therefore, a success in Apple Company, not to mention the development of iPods to iPads (Swaan, & Waalewijn, 1999).
Through Mac operating systems and computers, and other products that Apple Company has brought to the market, the company has been led into achieving a massive success despite the fact that they encountered several hitches before accomplishing that amount of success. The success is however attributed to the company’s ability to innovate and develop unique products and brand them with a mark of loyalty and quality assurance.
The five force analysis of Apple Company in the technological sector shows the industry’s competition and the bargaining powers of clients as the two strongest marketplace forces that have a great impact on Apple’s profitability. The level of competition among major companies in the technology sector is high. Thus, certain industries such as Google, Hewlett-Packard Company, Samsung Electronics among others pose a great challenge for the market shares to Apple Company. Therefore, this is considered a strong force.
Bargaining powers for customers is a strong force. An individual bargaining power as a buyer is considered a weak force since a single loss of customer represents a negligible income for Apple Company. However, when many customers collectively defect from the company’s products, then, it becomes a very strong force and to curb this, Apple Company strives to produce quality products with continued loyalty and quality assurances. Threats of new entrants is a moderate force for Apple Company. If companies are to come up then, it means that they will take some time to get established into fully fledged companies with a significant threat values to Apple Company. However, before all that happens, Apple Company will be striving to ensure that its customers are fully satisfied.
Bargaining power of suppliers is a weak force. The bargaining power of the suppliers is mainly weakened by the readily available potential suppliers in the market which weakens the suppliers’ bargaining chips. This surplus availability of suppliers makes Apple ready to renounce the other suppliers and employ new once. Threats of substitute products or substitution is a weak force. According to Porter’s Five Force model, a substitute product is that product which does not directly compete with the product. In this case, the only substitute product is landline telephone which is weak since most customers would prefer a cell phone to a landline telephone.
References
Swaan, A. H., & Waalewijn, P. (1999). A knowledge base representing Porter's five forces model. Rotterdam: RIBES, Rotterdam Institute for Business Economic Studies.
