Discuss The Swot Analysis Of The Apple Corporation (Essay Sample)

DIGITAL INOVATION JOURNAL 1
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The Apple Company which was founded in April 1976 is an American conglomerate technology corporation. Apple is the most valuable company in the world. Additionally, it is the world's leading technology firm by aggregate assets. This essay will look at the SWOT analysis of Apple Inc. Moreover, it will also discuss how an improved operating system than Macintosh for Apple Inc. would give the technology company an upper hand in its operations. According to (Hirsch & Peter 2007, p. 257) Apple’s SWOT breakdown provides insights on the activities which the company undertakes to maximize its development based on the organization's strengths and opportunities. To stay at the top, the organization enjoys strengths that its rival find hard to keep up with. First, the organization has a strong brand image. Being the most valuable brand in the world as well as one of the most reliable brands, this shows that the firm is in a position to present profitable new products by its famous brand image. Apple’s strategy is the production of quality products as well as services. Further, the organization maintains a premium pricing strategy. According to (Dustin, Bharat & Jitendra, 2014, p. 174) this approach comes with extraordinary profit margins. The pricing strategy is one of the major strengths since it gives the organization flexibility in adjusting prices for its various products leading to substantial profits. Besides, the organization has formulated an excellent advertising strategy which ensures boosted brand awareness. Consequently, a stronger demand for the business's products is created.
Conversely, despite the strengths enjoyed by the firm, just like any other business it has numerous weaknesses. For instance, the company's sales primarily depend on iPhone sales. The organization's 66% of total sales are made from the sale of iPhones. As a result, Apple is vulnerable to variations in the smartphone market. More smartphone companies are coming up with new products every day targeting the same market as Apple. The premium pricing strategy also shows that the corporation targets wealth consumers (Hasan, 2012, p. 76). The markets with such consumers are becoming saturated every day, and with time the organization may encounter challenges in its revenues. On the other hand, the organization has limited distribution channels and especially in India. India is one of the world's most populated markets in the world. This shows there's a ready market in the nation. However, Apple has very poor distribution channels in the country. The direct distribution channels in India are poorly managed resulting to low customer satisfaction levels in the country. The other major weakness of the organization is in research and development. Apple was one of the most innovative companies in the world some time back. However, this has changed in the past few years, and the company has not manufactured anything that is entirely new (Dustin, Bharat & Jitendra, 2014, p. 112). The spending for the company on research and design was 3.4% which was the lowest compared to its competitors in the last financial year.
Despite the challenges, the organization has several opportunities that can aid in its growth. The organization can expand its market by venturing into new market apart from the smartphone market. For instance, the company could manufacture health-related wearable gadgets. Many people in the world today are faced with many health issues. Since Apple is an innovation based company is can seize the opportunity and make health gadgets that would aid in keeping people healthy. Also, there is an increasing demand for both smartphones as well as tablets Apple can seize this opportunity and make more of these gadgets for the booming market. On the other hand, there are several threats facing Apple. First, the competition levels in the smartphone market are increasing; organizations such as Samsung, Sony among others are also making excellent phones. Such phones are increasingly becoming a big threat Apple iPhones. Further, the organization is faced with rising labor cost in the countries where its plants are located. The labor cost in Asia where Apple mainly outsources its work is increasing at an alarming rate and this is negatively affecting the production of the company. Moreover, the organization has been facing lawsuits over patent infringements which also are consuming its revenues and resources (Khan, Alam & Alam, 2015, p. 959).
A digital innovation in the near future that could affect Apple would be an improved operating system compared to the current one Macintosh. Macintosh is an excellent operating system, however; it can be improved...