Apple’s target market includes the University students, business people, kids, adults, and teenagers who use a wide range of Apple products in their daily life. The company has achieved a trillion-dollar market value and boast of trendy products that will make consumers camp and queue for new products overnight in some markets (Apple). The company key operating strategy over the years is to focus on premium consumes by charging high prices for their products without offering alternative pricing to middle-level consumers. It has sustained this through leading in cutting-edge mobile technology and always ahead of competitors that may try to launch a near-similar product to disrupt the market. Furthermore, the company has focused on offering complementary products to their million customers through the Apple store to try to consolidate their services in one platform.
The strengths are company specific and reflect the overall functioning of the organization, in terms of operational efficiency and marketing strategies. The three most notable strengths include a high-profit margin, strong brand image, and effective rapid innovation process (Apple). According to Forbes Magazine on the world’s most valuable brands, Apple tops the list with $ 182. 8 billion brand value and its main competitor Samsung is in distant seventh position with a brand value of $ 47. 6 billion (Forbes Par. They include high selling price, limited distribution network occasioned by high-end market targeting, and overdependence on sales from high-end market segments. Over the years, the company has maintained its policy on exclusivity which limits the distribution network since the company handpicks authorize sellers of its products.
Consequently, the exclusivity policy continues to limits the market reach for Apple’s products. The premium pricing policy excludes customers in the low-income brackets since the high-end target marketing only accommodates those in high-income brackets and a few in middle-income brackets who can afford the products and services. The high- and middle-income customers only represent a small fraction of the consumer market with the majority in the low-income brackets which the company has consistently shown a lack of interest to serve. Rising labor costs for contract manufacturers reduces profits margins and further drive product prices even higher, yet the current prices are out of reach for low-income earners and some middle-income consumers. The threat of counterfeited products as a result of weak anticounterfeit policies and manipulation of existing technologies to deceive consumers possess a huge threat to Apple growth and expansion in some of the unexploited markets.
Apple PESTLE Analysis External environment plays a critical role in influencing business growth and success. Some macroenvironment factors are beneficial to the business while others possess a threat to business growth and sustainability. The PESTLE analysis examines the political, economic, social technology and the legal environment. Economic Factors Current economic factors relevant to Apple company provide an opportunity for growth. They include rapid growth in developing and emerging economies, and stable economies in developed counties. The increased economic growth rate in developed economies such as in Asia counties remains Apple’s major targets in increasing revenues through exploiting the markets, and satisfying customer needs to stay ahead of competitors. High growth in developed economies creates more job opportunities in companies such as Apple that manufacture to export.
This promotes both the local economic growth and the global economy as well as the labor markets. The world is moving towards adopting sustainable production methods through the adoption of green energy. Consumers are increasingly aware of the need to conserve the environment through participating directly in environmental conservation efforts and associating with products from manufacturers that embrace green technology its operations and along the supply chain. The three main ecological factors related to Apple operations include labor rights trend, product energy efficiency trend and business sustainability trend, they both offer the opportunity to exploit to appeal to consumers and directly participate in environmental conservation. Apple has been at the forefront of enhancing business sustainability by implementing product recycling and related programs.
It has further innovated and adopted new technology that guarantees energy efficiency of its different product line, for example, improved processors, components and batteries that emit less heat, thus enhancing product life (Apple). Apple Five Year Share Price Performance From the graph above, Apple shares have performed exceptionally considering at some point in 2018; the company share fell to $147. Since the last quarter of 2018, the company shares have stabilized between $197. 1 despite the current market turbulence. The future share price is likely to hit above the $220 mark by close of the year considering the current investment in the entertainment industry with the introduction of Apple Tv plus and the introduction of Apple card with exceptional security features. Graph 2. 10 since the stock price will increase to almost $300 in the next five years.
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