A

Strategic Management
Report on
Apple’s IPHONE
In Competition of 3rd Trimester

Submitted to - Submitted by-

Prof. Hitesh Manocha Group 6

JK BUSINESS SCHOOL
JK Chawk, 1200 meters on Damdama Lake Road, Off Sohna Expressway,
Gurugram, Haryana 122102

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Group 6 members-
Amit Singh Pingal (005)
Ayush Srivastava (010)
Darshika Gupta (013)
Mohd Shariq Israr Khan (025)
Sudarshan Chandak (036)
Prabhakar Rai (048)
Ashish Kumar (057)
Alok Kumar (066)
Sampann Patodi (087)
Trishit sarkar (101)

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 Table of contents
Sl.no Particulars Pg.
1 Objective of study 4
Background of Apple’s iPhone 4
Mission, vision and core values of APPLE 5-6
Competitive Landscape 6-7
Industry performance for last five years and projections for 7
next three years
Market share of organized and unorganized for last year 7-9
and projection for next three years
Market share of Top Five players in the last two years 10
Apple iphone’s five competitive forces 11
indirect competitors 12
Competitive advantages of Apple iPhone 13
PEST factors 14-18
Internal Analysis
SWOT analysis
Value Chain analysis
Strategic Posture (IPHONE as a Niche product) 18-19

Strategic Approach 20
• Generic Strategies for Niche market & Recommendation
• Grand Strategies for Niche market & Recommendation
Functional Strategies 21-33
• Marketing Strategy
• Financial strategy
• HR Strategy
• Production Strategy
Projected profit and loss statement for next 10 years 33-35
(Sales/Revenue, COGS, PBDIT, DIT, PAT)
Recommendation & Conclusion 36 -37

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OBJECTIVE OF STUDY
The aim of this assignment is to make a business plan for the Apple iPhone company and to learn
various concepts of marketing by carrying out a field study. A Business plan is an expression of how it is going
to achieve its business objectives. We are preparing this business plan by understanding the various elements of
a strategic planning process.

Our study includes vision and mission statement, industries competitive Analysis, strategic postures, various
approaches and the profit and loss statement for next 10 years.

BACKGROUND OF APPLE’S IPHONE

The iPhone is a line of smartphones and marketed by Apple Inc. that use Apple iOS mobile operating
system, The first-generation iPhone was announced by former Apple CEO Steve Jobs on January 09 2007 since
the apple has annually released new iPhones models and iOS updates as of November 1 2018 more than 2.2
billion iPhones had been sold. The iPhone has a user interface built around a multi-touch screen. It connects to
cellular networks or WIFI and can make calls browse the web, take pictures, play music and send and receive
emails and text messages since iPhone launch further features have been added including larger screen sizes,
shooting videos, waterproofing, the ability to install third party mobile apps through app store and many
accessibility features up to 2017 iPhones used a layout with a single button on the front panel that returns the
user to the home screen since 2017 more expensive iPhone models have been switched to a nearly bezel less
front screen design with app switching activated by gesture recognition. The iPhone is one of the two largest
smartphone platforms in the world alongside Android forming a large part of the luxury market the iPhone had
generated large profits for apple making; it one of the world most valuable publicly traded companies.

The first-generation iPhone was described as ‘revolutionary’ and a ‘game changer’ for the mobile phones
industry and subsequent models have also garnered praise the iPhone had been credited with popularizing the
smartphones and slate form factor and with creating a large market for smartphone app or app economy.

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Mission Statement
The mission statements of Apple Inc. are the foundations for the company's success as one of the most
profitable companies in the world. The business, which was established in 1976, is a symbol of design creativity
and elegance. This situation benefits the brand, which is one of the company's main assets. Employees are
motivated to promote and contribute to creativity for competitive advantage by the company's corporate mission
and vision statements. Apple's corporate mission statements have evolved over time to reflect changes in the
organization, from Steve Jobs' time to Tim Cook's current leadership. The company's efforts in addressing
opportunities in the information technology, consumer electronics, cloud computing, digital delivery systems,
and semiconductors industries are now represented by the vision and mission statements.

Components arise from this Mission statement.

Best user experience: The part of 'best user experience' indicates that Apple's top priority is to make sure its
customers have a good time using their goods. Rather than being a source of entertainment, Apple creates items
that are easy to use. Each product's security features also contribute to a better user experience. Apple goods are
well-crafted and meticulously planned, which comes as no surprise.

Improving the lives of people: Apple's first section of its mission statement emphasizes the company's
responsibility to make its users' lives easier through simple and user-friendly technology. The company has
been compelled to connect this component with the demand for security features that enhance the user's
experience as a result of its awareness of vulnerabilities in the online room.

Empowerment of the public: Another important aspect of the company is innovation. When it comes to
technology, Apple is committed to helping close any holes. Since technology is still changing, Apple is
constantly coming up with new designs to meet the changing needs of its customers. Apple's approach to
fulfilling this part of its mission statement demonstrates that the company views its goods as more than just
entertainment devices. Instead, they are a source of empowerment, which explains the widespread use of apple
at work.

Top-quality products: Apple's product success demonstrates how far the organization goes to fulfil the third
aspect of its mission statement. Most importantly, one rule remains unbroken in this company, and that is to
provide the highest quality goods to customers. The company strives for excellence in all facets of its products.
The business gains a competitive advantage in the industry by combining high-quality hardware, software, and
services.

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Vision Statement
Apple vision statement is “We believe that we are on the face of the earth to make great products and
that’s not changing. The company emphasizes its commitment to providing high-quality goods to its customers
in this statement. They also plan to do so for a long time, according to the statement. It goes into great detail on
how the company approaches its activities in order to place itself as the leading player in the industry.

Apple's vision statement has an impact on strategic management choices made by the company's executives in
order to achieve a future of leadership in the different industries in which the company operates. The phrase
"best goods" implies that the technology company's corporate vision is to be a global leader in product design
and development. The desire to create the best products pushes Apple to keep searching for new product
creation innovations. Vertical integration lets the organization achieve a cohesive market situation for
leadership in the information technology, software, and online services industries in this direction. The
corporation has plans and policies that extend to its operations as well as the operations of business partners,
such as semiconductor component suppliers and manufacturers, in order to achieve its corporate vision
statement.

The Competitive Landscape

At first glance, it appears that Apple has a near-complete monopoly on the smartphone industry. They
aren't the only name in the game, but they have set the bar that everyone else must meet. However, just because
they're the top dogs doesn't mean you have to prostrate yourself in front of Steve Jobs and Steve Wozniak's
work. If you're an Android aficionado or simply want something other than an Apple product, the market is
flooded with alternatives of every form, size, and functionality. So, whether you want anything to compete with
the iPhone and its formidable camera collection, or you want to reduce the number of distractions in favor of a
simplified "dumb" phone, you've come to the right place.

SAMSUNG GALAXY: The least expensive “true” alternative to the iPhone is the most recently revealed
next-generation smartphone on our list (so long as you have an eligible trade-in). but don't be fooled by its low
starting price; the Samsung galaxy ultra 5g is a serious contender. To begin with, it has what Samsung refers to
as the "most intelligent screen" on the market.

GOOGLE PIXEL: It might seem weird to call a product made by one of the world's most powerful and
popular corporations a dark horse, but that's exactly what we'd mean about the google pixel. for a phone that no
one seems to be talking about, this is unquestionably one of the best alternatives to any iPhone model. it all
begins with the price.

NOKIA: It's not always necessary for an alternative to be equivalent to the industry norm in order for it to
become your preferred option. What we mean is that, while the Nokia seen here doesn't exactly crack the
mound, it can still compete with the current generation of apple mobile devices in the ways that matter most to
consumers. its professional-grade is the clearest example of this.

LG: With so many smartphones on the market with identical internals, it can be difficult to say if any of them
are truly distinguishable. there aren't many distinguishing features, owing to the fact that customers have come

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to demand a certain level of performance from their phones. However, as seen in LG, internal hardware and
software aren't always the only considerations.

SONY: Sony should be at the top of anyone's list of smartphones worth buying as an alternative to an iPhone
if they consider themselves a "content maker" or photographer. This is due to the fact that it was created with
picture and video production in mind. In reality, the company proudly proclaims that this is the world's first
smartphone.

INDUSTRY PERFORMANCE FOR LAST FIVE YEARS

Apple annual/quarterly revenue history and growth rate from 2006 to 2021. Revenue can be defined as
the amount of money a company receives from its customers in exchange for the sales of goods or services.
Revenue is the top line item on an income statement from which all costs and expenses are subtracted to
arrive at net income.

● Apple revenue for the quarter ending March 31, 2021 was $89.584B, a 53.63% increase year-over-year.
● Apple revenue for the twelve months ending March 31, 2021 was $325.406B, a 21.43% increase year-
over-year.
● Apple annual revenue for 2020 was $274.515B, a 5.51% increase from 2019.
● Apple annual revenue for 2019 was $260.174B, a 2.04% decline from 2018.
● Apple annual revenue for 2018 was $265.595B, a 15.86% increase from 2017.

APPLE STOCK PRICE PREDICTIONS for next 3 years.

• Apple stock predictions for December 2021.

The forecast for the beginning of December 150. Maximum value 167, while minimum
149. Averaged Apple stock price for month 156. Price at the end 158, change for
December 5.33%.
• Apple stock predictions for December 2022.
The forecast for the beginning of December 182. Maximum value 201, while minimum
179. Averaged Apple stock price for month 188. Price at the end 190, change for
December 4.40%.
• Apple stock price predictions for May 2023.
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 The forecast for the beginning of May 228. Maximum value 230, while minimum 204.
Averaged Apple stock price for month 220. Price at the end 217, change for May -4.82%.

● The Indian smartphone market registered a modest 4% decline in the pandemic-hit year.

● The market crossed 100 million units in the second half of 2020 for the first time ever.

● Xiaomi led the market with a 26% shipment share in 2020, followed by Samsung at 21%.

● Among the top five brands, realme grew the highest at 22% YoY in 2020.

● Apple witnessed its best ever quarter in Q4 2020, selling more than 1.5 million units.

Share of Apple in the mobile phone market across India from Jan 2020 to

April 2021

Iphone Market share in india

4

3.5

2.5

1.5

0.5

Iphone Market share in india

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Revenue and Net profit of apple in India
❖ Revenue of apple in India – RS 13,756 Cr in 2020. (29% YOY jump as compare to
previous year)
❖ Revenue of apple in India – RS 10,674 Cr in 2019.
❖ Net profit of apple in India – RS 926.2 Cr in 2020. (267% growth in 2020 as compared to
previous year)
❖ Net profit of apple in India – RS 262.27 Cr in 2019.

India's smartphone market

➢ IN 2021 – Rs 2 trillion (Excepted)
➢ IN 2020 – Rs 1.68 trillion
➢ IN 2019 – Rs 1.77 trillion

India Smartphone Market Share (%)

Brands Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021
Xiaomi 31% 29% 23% 26% 26%
Samsung 16% 26% 24% 20% 20%
Vivo 17% 17% 16% 15% 16%
Realme 14% 11% 15% 11% 11%
Oppo 12% 9% 10% 10% 11%
Apple 3% 3.5% 3% 3% 2.5%
Others 11% 4.5% 9% 15% 13.5%

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 Quarterly Highlights 2020
• The Indian smartphone market registered a modest 4% decline in the pandemic-hit
year.
• The market crossed 100 million units in the second half of 2020 for the first time ever.
• The smartphone shipments registered 9% YoY growth to over 53 million units. This is
the highest-ever shipment in a quarter for India (Q3)
• The smartphone market declined 51% YoY in Q2 2020 as April was a washout.

❖ Total unit Apple sold in India – 3.2 million iPhone (2020)

• In Q1 2020 Apple sold 0.5 million iPhone units in India.
• In Q2 2020 Apple sold 0.8 million iPhone units in India.
• In Q3 2020 Apple sold 0.4 million iPhone units in India.
• In Q4 2020 Apple sold 1.5 million iPhone units in India.

Market Summary:

The Indian smartphone market grew 19% YoY in Q4 2020 as the festive season offers got extended,
when compared to Q4 2019, due to Diwali falling on November 14.

● Apple captured the sixth spot in Q4 2020 with 171% YoY growth in Q4 and 93% YoY growth in

2020. The launch of the iPhone 12, aggressive offers on the iPhone SE 2020 and iPhone 11, and

online expansion drove this growth. For the first time, the brand crossed 1.5 million shipments in a

single quarter.

● Samsung slipped to the second position in Q4 2020 but exhibited a strong 30% YoY growth.

Overall, 2020 has been a great year for Samsung as it recaptured the second spot in the Indian

market. This was the first time when it went aggressive on online channels and built its portfolio

across various price bands. The brand grew 1.5x YoY in CY 2020 on online channel shipments.

Samsung was quite aggressive with its channels and go-to-market strategies for its mid-tier

portfolio, like the Galaxy M and A-series.

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 ● OnePlus experienced 200% YoY growth in Q4 2020 driven by its mid-range Nord series and the

newly launched 8T series. It re-entered the mid segment with the Nord series, which made it

possible to cross 3 million shipments in a year for the first time.

● Xiaomi recaptured the top spot in Q4 2020 with a strong 13% YoY growth. Ramped-up production

through partnerships with more EMS (Electronic Manufacturing Service) players, new launches

with a focus on the premium segment, strong demand for the Redmi 9 and Redmi Note 9 series, and

aggressive offers during the festive season led to a strong quarter for Xiaomi. In 2021, the brand will

continue to focus on the mid as well as premium segment to gain mindshare, besides increasing the

pace of offline expansion

Five forces analysis of Apple

Apple’s strategies are partly based on the need to address forces in the external business environment.
These forces can limit or reduce the firm’s market share, revenues, profitability, and business development
potential.

Competitive Rivalry –

Apple faces the strong competitive rivalry. This component of Porter’s Five Forces analysis model determines
the intensity of the influence that competitors have on each other. Companies like Samsung, one plus and LG
aggressively compete with apple. In terms of product differentiation, available products in the market are
generally similar in fulfilling specific purposes.

Bargaining Power of Buyers-

The bargaining power of buyers is strong in affecting Apple’s business. It is easy for customers to change
brands, thereby making them powerful in compelling companies like Apple to ensure customer satisfaction.
This external factor enables buyers to exert a strong force on Apple and other brands.

Bargaining power of Suppliers-

Apple experiences the weak force of the bargaining power of suppliers. The global size of its supply chain
allows Apple to access many suppliers around the world. This external factor reflects the presence of a small
number of big companies like Apple and Samsung, in contrast to a larger number of medium-sized and big
suppliers.

Threats of Substitutes-

The competitive threat of substitution is weak in affecting Apple’s computing technology, consumer
electronics, and online services business. This component of Porter’s Five Forces framework determines the

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strength of substitute products in attracting customers. Many customers would rather use Apple products based
on convenience and advanced functions. This condition makes substitution a weak force in impacting the
company’s business.

Threat of new Entrants-

Apple experiences the moderate force of the threat of new entrants. This component of Porter’s five Forces
analysis indicates the effect and possibility of new competitors entering the market. Establishing a business to
compete against firms like Apple requires high capitalization. These external facts make new entrants’ week.
There are large companies like Google and Samsung that have the potential to directly compete against apple.
Thus, the overall threat of new entry is moderate.

What are the competitive advantages of Apple’s top three

competitors?
Apple success can to some extent be attributed to its competitive advantage. The company has managed
to retain a high level of performance while other companies face hard times. Apple has remained unstoppable
while its competitors face difficult times.
Apple has managed to differentiate its products.

Competitive advantage of Apple’s top three competitors-

Samsung- Samsung has a good customer base. Samsung has good electronic items range. Samsung deals in
Smartphones also. Samsung’s Flagship smartphones are always the biggest competitors of Apple. Recent
launch of Samsung S21+, S21 ultra are compare with iPhone 12 pro and 12 pro max. Samsung gives a good UI
interface that its customers like Advantage of Samsung Also offers a mid-range and budget smartphone for its
customers.

Google- Google is also a big competitor of Apple. Google launches flagship smartphones like google pixel 4,
google pixel 5. Competitive advantage that googles have is their clean UI, stock android, and the camera.
Google’s camera can single handedly take best quality photos. Google’s UI has a great advantage as it is stock
android. No bloatware apps are there on Google and it provides good security to its customer’s data.

One Plus- One plus has emerged as a competitor of apple. In recent times it really had launched some great 5g
flagship smartphones and they are really liked by the customers. One plus has its own base of customers. There
are people who consider One plus over Apple. One plus UI is also great. It is smooth and provides a good
experience to customers. One plus offers good features in its smartphone such as Fast charging, Good UI,
Hasselblad camera, Smooth display and the latest snapdragon best processor.

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Who are Apple’s indirect competitors?
Indirect competitors are the businesses that sell a product or service in the same category as you, but it’s
different enough to act as a substitute for your product or service.
Indirect competitor of Apple's iPhone can be –

Personal computer – At the cost of an iPhone a person can easily buy a good personal computer which can
accomplish the tasks. So, a personal computer can be the indirect competitor of iPhone.

Tablets- At the cost much cheaper than an iPhone a person can buy a good tablet which can fulfill all the tasks
of an iPhone. iPad can also be considered as an indirect competitor of the iPhone as it can do all the tasks that
an iPhone can do.

DSLR’s- A good Desir also costs the same as an iPhone and the people who buy an iPhone due to its camera
can also consider DSLR as an indirect alternative as it will capture the photos in much better quality than an
iPhone.

Competitive Advantages
I-Phones, a product which comes under the brand name of APPLE, has great competitive advantages over the
other brands such as One Plus, Samsung, Redmi, Xiomi, RealMe, LG ETC.

Premium Products
Apple has done an excellent job in delivering a wide range of innovative smartphones over the years
which has resulted in higher revenues and popularity. iPhone is the best-selling product for apple and
contributes majorly to its revenues. iPhone costs are high and the service and quality differentiate the product
from the other brands of products.

Innovation
Company is very much innovative as the company comes up with different features, Upgraded IOS
services, Unique Design, Size, High Definition Camera and most important with high security and this creates
an differentiation as the customer are looking for the design and smoothness of the smartphones the customer
also looks for the features and the camera quality as Indians are more concentrated on the camera of an
particular brand it makes an competitive advantage from other smartphones brands as other brings product with
high definition camera but it can’t beat the picture quality Of iPhone, the security is also an plus point and
Apple always focus on innovation.

Customer Relationship
Customer relationship/ royalty can be very advantageous in today’s era as every company works
towards retaining its existing customers and maintaining customer loyalty. Apple generally focuses on ensuring
that customers have an experience rather than simply making a purchase. The support accepts all kinds of
feedback, be it good or bad, by acknowledging people who compliment them and working quickly to solve any
issue they make everyone feel valued.

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Brand Equity
One of the reasons for the competitive advantages over the other brands is the brand equity. Apple is
known for delivering the best quality products and services it has maintained the trust levels among the
customer for years. A product with a brand is how people feel about the company and surely its fans have a lot
of positive feelings about it. I phone do a great Job of ensuring that its customers get the best experience be it
the way you shop in the stores.

PEST Analysis:
Political:
· the political relations between the United States of America and other countries including the UK
· enhancing free trade policies and balanced politics in developed countries
· Apple also had some difficulties in controlling the political factors, most of the sales of its
products come from countries outside of the US.

Economical:
· rapid growth in developing countries and stable economies in developed countries.
· making distinct unique products from its competitors, which has augmented the demand for Apple’s
products.
Social:
· High status Lifestyle
· Potential market place in third world country
· Moral factors of manufacturing in China
· Brand acquisition in many countries
Technological:
· Advantages of 760 China Mobile Subscriber
· Accessing the consumer’s mind
· Competitors offering the same
· Limited market for new products

Internal Analysis
Apple Inc. is an Industry where the different category of products is manufactured and sold in the
Market. I Phones, a product which has been sold under the brand name of Apple has been recognized as one of
the best products in the smartphone industry. I phones are very much different from the other brands such as
Xiomi, RealMe, Samsung, Sony. I Phones have been launched with a different Software as IOS and the other
brand smartphones come under Android. I phones are known for its security features, Camera iPhone is the
giant in the smartphones industry majorly In India and the company targets the Upper Middle class, Upper class
persons who can afford the product as I phones comes in high range with a trust and with the brand name of
Apple.

The company strength is its brand value as the customers have a trust and faith and the company focus on the
trust of the customer and it always bring it products with new features and in shorter duration of times which
encourages the customer to purchase the product so it differentiates from the other brands and the company
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focus on less advertisement as they know their customers and they don’t go for much advertisement they do on
the social media advertisement. Company has good promotional knowledge.

SWOT Analysis
Strength
Brand Advantages: Apple is a global brand and it's among one of the most valuable brands of the world. It
gives its products distinctive advantages and most of its products are not just popular but are leading in the
market Like the I-Phones. This brand of I-phone gives an edge over the other smartphones in the market.

Investment in Branding and Marketing: Apple invests a lot in branding and marketing. I-Phones are
marketed over the internet and television. Due to the brand image and size of Apple it already gets a lot of
exposure and publicity.

Touch ID and Apple Pay: These are some features found in the newest versions and which again proves Apple
focus on innovation and user convenience.

High tech camera for better pictures and videos

Powerful and Efficient
Retina HD display with 3D
Growing worldwide sales
Creativity
Novelty and Structure

Weakness
High priced products: I-Phones can be considered a luxury due to their premium prices and the products are
priced for the middle and high-income consumers, low-income consumers can’t simply afford the I-Phone.

Limited advertisement and promotions: Apple have solidified their grounds by establishing loyal customers
even with the limited advertisement resources.

Allegations of Technology: Tracking users determines trust. Apple has been accused of using tracking apps in
its phones which revealed the precise locations of users.

Restrictions on the Phones: there are unnecessary restrictions on the apple I phones out of the box the
expandable memory is absent.

Opportunities
• Consistent customer growth
• Expansive Distribution Network
• Huge Untapped Market
• More Innovation, features and models

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 Threats
● Lack of choices for customers
● Mobile manufacturers using Android OS
● Threats from cheaper substitutes

VALUE CHAIN ANALYSIS

It was Michael E Porter of the Harvard Business School who introduced the concept of the value chain.
The value chain consists of the entire range of activities from the beginning to the end involved in bringing the
product to the market and the end user starting from the raw material till marketing, sales and after sales service
all these stages add value to the product. Through the optimization of the value chain the companies cannot
reduce their cost but also improve their operational efficiency. This is an analysis of the Value Chain of I-
PHONE, a product of Apple Inc.

There are 2 kinds of value chain analysis, the primary activities and the support activities.

Primary Activities:
Inbound Logistics
I-Phone has a very large supply chain and when it comes to obtaining raw materials it has several
options before it. The inbound logistics consist of the sourcing, manufacturing, warehousing, Distribution. The
sourcing is from the United States, China, India, Other Asian Country, Europe and after sourcing the
manufacturing/Assembling are been done India, China now comes the warehousing part the iPhone
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intermediate Warehouse are via UPS/ FedEx and in elk grove, California through FedEx it’s been sent to online
stores and facility of grove are send through retail stores, direct sales forces, wholesalers, retailers, network
carriers.

Operations
Although the tech giants do not apply Just-in-Time principle in inbound logistics. Apple (I-Phones)
supply chain practices is a benchmark for efficiency for the business. The multinational technology company
purchases commitments typically cover its requirements for the period up to 150 days CEO Tim Cook is
known for his strategy getting suppliers considerably after becoming CEO In 2011 the main sources of inbound
logistics relate to the economics of scale to the massive scope and scale of business operations as discussed
below and the development of strategic operations as discussed below and the development of strategic
relationship with suppliers moreover Apple Inc( I-Phones) exercise an immense bargaining power in dealing
with its suppliers and as a result the company is able to secure cost advantages in the purchase of resources.

The world largest IT Company by revenue tries to keep operations lean but it does not apply Six Sigma
principles like its competitor Samsung, Xiaomi etc. iPhone operations are being performed worldwide and it has
majorly been done in America, China, Europe, japan and apple operations are conducted by 1,47,000 full time
equivalent employees all around the globe.

Outbound Logistics
Apple(I-Phones) outbound logistics involve warehousing and distribution of ready products of Multiple
categories as I phone XR, iPhone XS, iPhone 12 etc. for technology items inventory depreciation rates are very
high due to short product life cycle. The management recognizes this critically important aspect of the business.
The company distributes its products to multiple platforms as an E-Commerce site, Warehouse and Inventory
stores.

Marketing and Sales

Apple Sells its products through the following sales channels:

1. Apple retail Stores

2. Apple Online Stores

3. Direct Sales

4. Third- party cellular network carriers

5. Wholesalers

6. Retailers

7. Value-added resellers

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The tech giant consistently increasing the shares of sales through direct sales channels as opposed to the indirect
sales channel. IN 2020 the net sales through its direct and indirect distribution channels have accounted for 30%
in India.

Services
Apple is famous for its exceptional quality of customer services during all three stages pre- purchase during the
purchase and post-purchase the company maintains a friendly behavior. Apple experience centers in major
cities around India where anyone can use its products to become convinced about the quality apple sales
assistants are usually trained and polite young males and females who are technically savvy and happy to
demonstrate product features and capabilities.

Apple stores have emerged as hubs where customers can go when they are sure about anything or when
something goes wrong there are cases where customers had their cracked iPhone screens repaired at an apple
store for free.

iPhone as a Niche product (Strategic Posture)

We Would like the iPhone to be a Niche product in the market because we want a strong and loyal
customer base who prefer to buy a mobile phone with a wide range of things such as standout features, power-
packed performance modules, and affordability. Moreover, due to its Operating system (IOS) which is different
and unique from different smartphones. We are also planning to position the iPhone as a premium product,
because its bestselling status will speak volumes of its value. And the reasons why we choose iPhone to be a
Niche product is because iPhone being one of the best smartphones design, great speed, top-of-the- line
features, remarkable performance and many more exquisite features like-

iPhones are faster

When customers think of buying an iPhone, know that the A12 Bionic chip inside beats
anything from the Android camp. iPhones can transcode video faster as compared to other smartphones
This speed difference also makes enjoying demanding augmented-reality apps a smoother experience.

Better hardware and software integration

I phone’s Face ID, which securely logs its user into the iPhone using a 3D scan of their face via
a True Depth sensor. Other companies have attempted to copy Face ID, but none have succeeded.
Animoji and Emoji are other examples of Apple hardware and software working seamlessly together.

Easiest phone to use

IPhone is the easiest phone to use by far. With its slick design it is easy to Pick it up, turn it on, touch the
app to open. Apple has folded in enhancements over the years, such as Siri and Control Center. With iOS 11,
the iPhone has the ability to edit Live Photos, send payments to friends in the Messages app and organize files
via a proper Files app. And in iOS 12, users got Siri Shortcuts and Suggestions, faster performance, Group
Facetime and other enhancements.

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OS updates when you want them
With a compatible iPhone, users can update to the latest version of iOS on the day it's released (or close
to it, depending on how Apple's servers stand up to the strain). This dynamic isn't going to change anytime
soon. Whereas this feature isn’t available in other smartphones

The best apps first

The iPhone is still favored by developers as the launch platform of choice for the hottest new apps. The
Google Play store is like the Netflix of app stores; it gets the hits, but usually after they see their first run on
iOS. Users who don't want to be treated like second-class app citizens; the iPhone is still the king.

No Bloatware!
iPhone doesn’t need a preloaded single piece of carrier software, making for a clean out-of-the-box
experience. Apple does include some apps you might not want or need, like Apple Watch, but it has much more
restraint than other manufacturers when it comes to bundling its own stuff. And on iOS 12, you can at least
disable built-in apps you don't need.

Works beautifully with Macs

MacBook works very efficiently with iPhones. For instance, with the Continuity feature in macOS,
Users can use MacBook to send and receive text messages and even receive and place calls. All they have to do
is keep your iPhone nearby. It also has an Airdrop feature, which lets the user easily transfer photos and videos
over Wi-Fi from iPhone to a MacBook. With macOS Mojave and iOS 12, the new Continuity Camera feature
lets users instantly insert a photo into a document, mail or note.

Apple Pay
Apple Pay is a method for making mobile payments. It’s also dead-simple to use. All users need to do to
use Apple Pay is bring their iPhone close to the supported payment terminal at the checkout counter and then
press their finger on the iPhone's Touch ID sensor. With the iPhone XS and iPhone XR, users just double tap
the Side button and then stare at your phone to use Face ID. iPhone also supports sending and receiving money
from friends and family from within the Messages apathete are third-party apps that do this, which is built right
in.

Family Sharing
With Family Sharing on the iPhone, Mom, Dad and the kids can share purchases from the App Store,
iTunes and iBook with up to six people. They can still keep their own iTunes accounts, too. Other Family
Sharing features include shared photo albums, a shared calendar and the ability to see where their kids are on a
map at any time.

Best support and help

When users have a problem with their iPhone, they can tap into a vast database of useful help articles on
Apple's website, get help via live chat or schedule an appointment at an Apple Store Genius Bar

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Generic Strategies we would recommend
iPhone generic strategy is broad differentiation. This generic strategy focuses on key features that
differentiate the products from competitors. Through the broad differentiation generic strategy, Apple iPhone
stands out in the market. For example, elegant design and user-friendliness of a phone, combined with high-end
branding, effectively differentiate the technology business. This generic strategy means that Apple always aims
to set itself apart from competitors not by price but by competitive advantages based on product design that
attracts customers. Such design includes seamless connectivity among its phones and cutting-edge aesthetics.
Even though this generic strategy makes iPhone different, the company still broadly reaches various segments
of the market. In this way,

The generic strategy of broad differentiation supports the company in maintaining its competitive
advantage, leadership, and position as a high-end and high-value technology business.

The broad differentiation generic strategy has significant implications on I phone’s strategic objectives.
For example, to apply this strategy, the company must continue emphasizing innovation through research and
development. Apple must keep innovation of its phone at primary level so that the business maintains its
competitive advantage. Competitors eventually catch up with new technologies and new products, so the broad
differentiation generic strategy compels the company to continuously innovate to keep itself always ahead of
the competition. Thus, continuous innovation is one of I phone’s strategic objectives based on the broad
differentiation generic competitive strategy. In addition, to maintain business growth, the company must keep
growing its market reach in India and adding. In its generic strategy for new customer continuous competitive
advantage, another of I phone’s strategic objectives based on its generic strategy is to penetrate markets to
ensure a broad reach. Such expansion and business growth are achieved through intensive strategies for growth.

Grand Strategies we would recommend

Focus on the user experience.

Give away your software in order to make your hardware more valuable and your competitor’s software less
valuable.

Make your platform so valuable that your competitors will feel compelled to put their services on your
platform.

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Marketing Strategy of iPhone in India
Apple was doing good in India in the smartphone category but after the entry of Chinese smartphone
player like Realme, Xiaomi, Apple went through a depressing year that saw Apple’s sales and revenues
nosedive in India, so to the tackle the problem the US-based tech giant has come up with a three-pronged-
strategy that will shake up its existing structure in how it handles retail, manufacturing, and pricing in the
country.

Apple’s India new strategy to revive the sale and revenue has been divided in 4 points

(I) Making better and longer-lasting retail deals with higher sales targets.
Apple will be partnering with individual stores to raise sales targets by four times to 40 or 50 units every
week. In exchange, Apple will be training staff to teach customers how to operate their phones, similar to what
it does in its Genius Bars and revamp in-store branding as well as product displays. In addition, the company
will be employing stricter guidelines with conference calls to track progress and cutting off retailers which,
more often than that, fail to hit the established target.

(ii) The opening of official Apple retail stores in India.

With the launch of the Apple Store online and with a retail store set to launch sometime next year
customers in India now have the ability to buy products directly from Apple., Apple plans on opening new
official stores in New Delhi, Bengaluru, and Mumbai. That's a big deal, because it means customers in the
country can get to customize their products. Apple is offering a wealth of configuration options for those buying
the iMac and MacBooks, there are plenty of custom bands for the Apple Watch, and with a generous trade-in
program, buying an iPhone in India has never been easier.

(iii) “overhauling” the company’s relationship with independent retailers.

Apple is said to be in talks with retailers and banks to “offer holiday deals year-round” to convince
customers to purchase its smartphones.

(iv) Improving apps and services “aimed more closely at Indians.

This strategy includes a completely overhauled Apple Maps that is slated to launch in 2020. The
company is slowly rolling out more detailed first-party map data for Apple Maps beginning with iOS 12 betas,
and it looks like India might be on the receiving end of the improved coverage. These upgrades may also
include turn-by-turn directions.

Page | 21
Marketing segmentation
Apple has segmented its market into four major key areas of creative professionals, business, education,
and high-end consumers.

Apple iPhone marketing mix

Product
The IOS operating system
The first and foremost quality which people loved in the iPhone was access to the world-renowned
Apple iOS operating system. The MacBook is probably the most desired laptop and the iPhone has access to a
similar operating system like Mac Book which was iOS. As android and Windows operating systems came later
on smartphones, Apple was able to spellbound its customers with its mobile operating system.

Processing speed
Only the operating system was not enough to keep customers attracted, it required processing speed as
well. iPhone hardware was very much compatible with the software and the OS used to run smoothly. Thus, the
high-quality processing speed also lends a hand towards the popularity of the product.

Price
Predominantly, India has been a very price sensitive market. We Indians, always look for value for
money – what values are we getting for the price we are paying for a particular product or service? With an
average income of less than $2000 in a year, the majority of the Indians are not ready to spend more than $200
for their smartphones. Most of the smartphones sold in India are in the price range of $50 to $200. Apple
doesn’t have any offering in this price segment. The premium smartphone market, where Apple operates, still
makes less than 5% of the overall market of India. Apple charges a lot of premium for its products which has
not been accepted by the price-conscious consumers of India.

On the other hand, the Chinese smartphones manufacturers such as Xiaomi, Vivo, Oppo, and Huawei
along with the Korean giant Samsung are killing the competitions in the Indian smartphone market. Domestic
players like Micromax, Karbon and Intel are almost finished in this intense competition. Samsung had lost its
ground too to the Chinese players like Xiaomi. But it seems like Samsung is now adopting a new strategy to
making its mark again in the Indian budget smartphones market, by introducing its new Galaxy M Series (M10,
M20 & M30) smartphones.

At this point, Apple is not too keen to change its pricing strategy for the India market.

Place
Most of the Apple products are not manufactured locally in India. Stiff tariffs, local regulations and very
high import duties on iPhones are making them less affordable in India. Though the older iPhone models such
as iPhone SE and iPhone 6S are locally manufactured in India (partnership with Taiwan manufacturer Wistron),
the price remains still on the higher side. At the same time, other players like Samsung and Xiaomi are
manufacturing almost all of their smartphones in India, leveraging the “Make in India” initiative by the current
Page | 22
government. Since 2007, Samsung has had one of its largest manufacturing facilities in Noida, India. Soon
Apple is expected to move its iPhone X series production to southern India (partnership with Foxconn). This
might give some breather to Apple in terms of reducing the price of its iPhone X series.

Again, Apple can’t have its Apple stores in India due to some regulatory issues. Not having dedicated channel
partners feels like rubbing salt in the wounds for Apple. Apple is committed to building a strong retail network
in India by partnering with e-commerce companies such as Flipkart and Amazon as well as premium 3rd party
sellers such as Reliance Digital and Croma.

It seems like Apple is trying to solve these issues soon.

Promotions
ATL – Promotions of iPhone are known to be fantastic and might range from a full front-page ad on the launch
of the product, promotions on online, the television and what not. Whenever a new phone is being launched, be
sure to see iPhone everywhere, on each and every ATL platform. Because they are targeting a premium
segment, the presence of Apple iPhone is higher in the ATL segment than in the BTL segment. The interesting
thing here is the taglines in newspaper ads because many of the iPhone ads are known to come up with the most
interesting taglines for the new phone.

BTL – For BTL marketing, iPhone uses out of home advertising with hoardings and point of sale advertising in
major retail outlets. It also uses various forms of sales promotions and exchange offers to lure in the customer
via BTL marketing.

As you can see, the iPhone marketing mix is one of the strongest marketing mixes because the key factor –
Product, is very iPhone strong. When you read the SWOT analysis of iPhone, you will find out the various
strengths of the brand and the product. As the product is strong and it is being supported by the promotions, this
ensures that 2 Ps are very much intact for the Apple iPhone. The remaining 2 P’s – Pricing and place contribute
well to make Apple iPhone one of the bestselling smart phones in the market.

Page | 23
Financial Strategy at Apple
Need for financial Strategy
Reality in the world is that it is no longer survival of the fittest; being strong is no longer being gauged
based on the physique of a person. In the ancient world, where people are just occupied on their present and
basic needs and that status is being bestowed based on bravery and lineage but then as life becomes complex
and when everything is no longer about basic needs and status is being given not based on lineage and bravery
but on criteria that this commercial world had bestowed, and that is financial security. The status of a person in
the present commercial world is being determined on the person’s financial security.

To achieve financial security, there is a need for you to have a financial strategy. If you will live your life the
way the stone-age people do, then you can expect that you will face life’s future with misery and financial
distress. Financial Strategy is also being employed by large corporations in order to ensure that it will be on top
of the competition. Even in Silicon Valley, the tough competition can be seen, with Apple considered as the
company that changed the way people lived and adopted a financial strategy.

Strategies used by Apple

1. Focus on Decisive Investments
Organizations become lucrative after investing in areas, where the company scrutinizes and
contemplates growth. Hence, any big tech like Apple formulates all the pros and cons, before indulging into the
thought of making big investments. As Apple is being recognized for augmenting their technology, improving
products and services, and presenting the customers with an assortment of options, each more suited from the
previous one, hence most of the investments are made in the research and development of new apple products.
Also, as most of the investment by Apple is not disclosed, different areas and segments of investment could not
be tracked down.

In 2016, Apple stated that the company is developing new technologies to enhance existing products thus
expanding the range of its product offerings through R&D, licensing of intellectual property and acquisition of
third-party businesses and technology. The total research and development expense was compounded to be
US$10.0 billion in 2016, while the total cash and short-term investment of Apple for the year 2016, accounted
at US$67 billion.

Apple’s investment continued to grow for the year 2017 as well. For the year 2017, Apple’s iPhone
business garnered 60% of the total revenue by investing in its phone business. The total R&D expense for 2017,
accounted for US$11.6 billion, and was heavily governed by delivering, and licensing intellectual properties,
and acquisition of third-party businesses and technology. The intellectual property of Apple includes patents,
copyrights, trademarks, service marks and other forms of intellectual property rights. The total cash and short-
term investment compounded for US$74 billion.

In 2018, the company made heavy investments in the research and development of its product. The total cost for
research and development accounted to be US$14,236 billion, the total investment of the Q2 for the year 2018,
valued at US$3.378 billion on research and development.
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 Apple’s investment in the research and development of its products and services increased in 2019, as
compared to 2018. The company invested US$16,217 billion for research and development, which was 7.9% of
its total revenue according to the reports. As Apple observed a decrease in the sale of the company’s major
product iPhone, the company then invested more in its core technologies. Apple has also invested US$1billion
for purchasing Intel’s modem division, thus making this as the largest ever from an employee integration
standpoint.

2. Growing Inorganically through Mergers and Acquisitions

Though there is no magic formula to make acquisitions successful, some of them have the potential to
change the course of the main company. Most of the acquisitions or mergers are made in view to augment the
performance and offerings of the target company, broaden the market and acquire skills or technologies that
will be instrumental in boosting the scalability and provide an edge in the market. While previously critics
charged that Apple is too slow to acquire outside companies and new technologies, the company has proved this
notion wrong in the past few years. Last year, CEO Tim Cook issued a statement saying Apple purchases a
company every two to three weeks on average. And the reason most of such deals don’t come in the limelight is
that Apple doesn’t announce them since the companies are small and Apple is “primarily looking for talent and
intellectual property. In the annals of its history, the most significant acquisition was its US$3 billion purchase
of Beats in 2014 and turning it into Apple music.

While the fanfare of Apple always gets excited during any Apple events, especially the iPhone, the recent
announcements on the mergers and acquisitions, highlight the company’s appetite to emphasize beyond the
traditional iPhone market and audience. For instance, one of the main focuses is to expand the AR/VR segment
of Apple. Closer scrutiny reveals that the M&A activities have tracked closely with elevated capital expenditure
budgets and aims for a win-win scenario.

Starting with 7th January 2016, Apple acquired Emotient, an emotional intelligence startup that leverages AI to
decipher people’s emotions by analyzing their facial expressions. This technology is used for detecting a
person’s emotions at any given moment, in real-time, just by analyzing their facial patterns. One of Emotient’s
first wearable applications was a Google Glass add-on that the company hoped salespeople could use to judge
whether a person actually loves a product or not. Next came Flyby Media, a company that designs technology
allowing mobile phones to see and scan, through the camera, the world around them in applications like indoor
mapping to driverless cars. Later on, 5th August, Apple bought Turi, an AI startup focused on tools that help
enterprises make better sense of data for US$200 million. And the next major AI acquisition was Tuple jump
which is an Indian machine learning company that aims to simplify data management technologies and make
them extremely simple to use. A TechCrunch report says Apple wanted this company for its Filo DB project,
which was an open-source project that Tuple jump was building to efficiently apply machine learning concepts
and analytics to massive amounts of complex data right as it streamed in.

On 24th September 2018, Apple had completed its acquisition of music recognition service Shazam for US$400
million, after reaching a preliminary agreement in December 2017 and made the Shazam app ad-free for all
users. Shazam, which is a fan favorite for music lovers, offers identification of the names and lyrics of songs,
music videos, TV shows, and more, simply by listening to and deciphering whatever is playing. Next month, on
11th October 2018, Apple paid US$600 million to license intellectual property, assets, and talent from English
semiconductor manufacturer Dialog. Apple had accounted for 74pc of Dialog’s sales in 2016, and the
chipmaker had been the exclusive supplier of power management integrated circuits (PMICs) for the iPhone,
iPad, and Apple Watch.

From 10th December 2017 to 19th January 2018, Apple had acquired a team of data scientists from a company
called Silicon Valley Data Science. The startup was described as a company focused on providing data analysis
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to larger companies “to improve their forecasts, operational efficiency, and customer relationships.” Apple
confirmed that it acquired Akonia Holographic intending to continue its work on lenses for augmented reality
glasses. By then, Akonia Holographics had held some 200 patents related to technologies and displays for
augmented reality glasses. Spektral, a Danish startup that specialized in software to digitally steal people and
objects from the background, was also purchased by Apple with merging by 10th October. Apple’s next
acquisition of 2018 in AI came on 20th November, when it acquired Silk Labs, an AI startup focused on
software lightweight enough to fit onto consumer hardware like cameras and user privacy.

In January last year, Apple acquired Xnor.ai, a venture-funded startup company established in 2017, for an
estimated US$200 million. Xnor.ai offers technology specializing in image recognition and machine learning
techniques or algorithms that work locally on mobile devices. It is believed that Xnor.ai models’ installation
capability on edge devices and Apple’s strategy to invest in its products with onboard intelligence that doesn’t
need cloud servers can bring a new era of edge systems. Another of Apple’s most recent acquisitions was the
purchase of Dublin AI startup Voysis. Noel Ruane founded Voysis with Peter Cahill in 2012 to help businesses
to set up deep-domain, brand-specific intelligent voice systems that can provide users with rich, natural
language interactions. Bloomberg reports that Apple plans to use Voysis’s offerings to improve Siri’s
understanding of natural language. Further, technology developed by Voysis can help improve digital assistants
in online shopping apps. In June, Apple bought Fleetsmith. This company offers a suite of management and
security services that enables its users to oversee their fleet of enterprise devices.

Page | 26
 Strategic Human Resource Activities at Apple Inc
Apple has based its success on the strength of its employees. The HR strategy employed by the
company is the primary reason behind its continued growth and excellent performance in the market.
Apple has some of the great talents, and the management has been equipped with the best talent
management approaches. This is to ensure that the company attracts and retain the talented workforce.
Great talents and efficient management skills are the primary reason why Apple has become a leader in
the manufacture of consumer electronics.

Apple Inc. marketing strategy focuses on the expectations of the customers. Apple products are
aimed at improving the lives of the users. The company is committed to understanding the needs of the
consumers before launching a new product in the market. Besides, the customers are provided with
different skills and tools to enable them to use the products efficiently. The marketing policies of Apple
are based on creativity and innovation. They are also responsive to the needs of their clients as stated in
the mission statement of the firm. The primary objective of the company is to promote personal
computing among various groups of people including creative professionals, students, consumers, and
educators. This has been made possible through their software, internet and hardware offerings.
Therefore, Apple Inc works in an environment full of challenges. However, it has been structured to
overcome such challenges. The internal structure of the company adopts best practices that attract and
retains talented force.

Models of Strategic Human Resource Management

The key people who work for Apple are at the marketing, technical, staff positions. The primary
objective of the company is to attract and retain its employees. To achieve this, the company has
employed different strategic human resource practices to attract skilled professionals. Apple is
interested in maximizing the efforts of its workforce by investing in their skills. The company
recognizes human capital as a vital element for overall competitiveness. The human resources are the
driving force towards its development strategy. As such, the firm has capitalized on the competencies
of its staff with the primary objective of achieving competitive advantage in the market. The great
talents and people management approaches used in the company have enabled it to become the most
innovative firm in the consumer electronics industry.

HR of Apple Inc. works towards maximizing the returns on investment by minimizing the
financial risks while capitalizing on human capital. The human resource management of Apple Inc is
charged with various responsibilities including recruitment and selection, leadership development,
incentive compensation, employee development, and employee relations among others. These
activities are carried out by human resource managers efficiently and consistently. The key
strategic human resource functions are discussed below.

➢ Recruitment and Selection

Recruitment and selection are the keys to the success of most organizations. Apple has invested
a lot in recruitment process with the primary objective of getting the right talents who can fit the
organizational culture. The company requires employees who are hardworking and committed to the
Page | 27
activities of the enterprise. Apple uses a different recruitment strategy which is different from other
employers. Apple does not promise its employees on career progression. The employees are required to
own their career. In this, case the company does not support career path. The workforce is expected to
seek information concerning their jobs. The company also relies on pirate raiding of talented workers
from other businesses. The recruitment process is designed in such a way that only employees who fit
the organizational culture are hired. The selection process is based on the verbal interview. The
recruitment and selection model enables the company to get right talents to serve the organization.

➢ Diversity and Equal Employment Opportunities

Apple provides equal employment opportunities to all people regardless of their gender, race,
ethnicity or disability among others. The company also employees’ people from diverse backgrounds.
As such, it has been able to attract a talented workforce from different parts of the world that have
contributed to its continued success and growth.

➢ Employment Benefits and Compensation

Apple provides competitive packages to attract talented staff. The benefits are provided based on
the employment status and the geographical location of the employer. Some of the benefits provided by
the company include insurance cover, employee stock purchase programs and investment and savings
plan. Employees are also entitled to products discounts. They are also given bonuses for working with
experienced talents in the industry. Apple provides flex benefits where employees are required to
choose the benefits that best suit their lifestyles. The Economic reward has been used as the best
retention strategy by Apple. Employees are awarded periodical stock grants for their contribution to the
company. This is a great opportunity for employees to create wealth and realize individual
accomplishment at retirement. The company also embraces agility. This has been the major
contributing factor to its success and employee retention. Employees are encouraged to shift from one
manufacturing department to another. For instance, an employee can shift from music industry to
computer and then to the smartphone industry. The company encourages employees to be a master of
all activities as they prepare themselves for the next big thing. This strategy has motivated employees
to commit their effort to the organizational culture since they are in a position to enhance their skills.

➢ Employee Appreciation and Recognition

The company has a program known Apple Fellows Program that was created in 1995 to recognize
employees who make an extraordinary contribution to the company. Employees who receive this award
are appointed as leaders. They provide visionary guidance to the organization in their field of expertise.
This strategy motivates employees to work hard since it also associated with economic benefits. Apple
appreciates and values employees who are committed to innovation. As such, the firm has attracted
some of the best and committed talents in the industry.

➢ Career opportunity
The recruitment policy of Apple focuses on the suitability of the candidate to fit the organizational
culture as opposed to the level of skills and experience. Apple gives the employees opportunity to
advance their skills while working for the organization. It provides an opportunity for training and
Page | 28
 development. Employees are encouraged to learn on the job. Besides, the company provides on-the –
job training to allow employees to advance their skills on the job.

Apple also absorbs employees through an internship. Those who are on internship are provided with
actual learning experiences that allow them to develop in their prospective careers. The internship
opportunity attracts the most talented students. They are provided with the opportunity to develop their
skills to equip them for future employment opportunities. At the end of the internship, the interns who
display outstanding performance are employed. Besides, those who are not fortunate to get
employment from the company can get jobs immediately. This is because Apple provides a real
learning experience that other firms cannot provide. The interns from Apple are promptly employed by
other companies within the industry.
On-the-job training provides junior staff opportunity to interact with the experienced and talented
workforce. In this case, they can overcome challenges that they are likely to experience in the course of
their duty.

➢ Training and Development

Apple utilizes a unique training approach to ensure that the employees are equipped with right
skills for the job. The company allows the employees to do things on their own to encourage them to
develop strong self-reliance. In this case, the workers can learn from their mistakes. This strategy has
enhanced skills development. Employees are encouraged to develop innovative skills since they are
allowed to work in different units within the organization. Apple uses a unique approach to assigning
roles to different teams. In this case, several groups are assigned to perform a particular task. After
accomplishing the task, they are then assigned an entirely different role. The teams are required to do
something new at all times. This is the reason why Apple has developed as one of the innovative
companies in the world. The teams always compete to provide something new that is entirely different
from the previous projects. After completing the tasks, the work of each team is reviewed, and the
best is selected or chosen.
To enhance the culture of free thinking and innovation, the teams meet twice in a week. During the
meetings, they can brainstorm to come up with something new full of innovation. Apple does not
prepare training programs, but employees are encouraged to learn on their own. This type of learning
allows the employees to receive incredible returns that contribute to the development of the company.
The challenges experienced during the projects encourage employees to become proactive about what
will be taking place the following day. The employees of the Apple can learn on their own without
training. This strategy has enabled the company to nurture and develop talents that have made the
company to achieve international recognition.
The strategic human resource management approach used by Apple Inc. is aimed at attracting the best
talents and retaining them at the same time. These strategic HR practices have enabled the firm to
become the leading provider of consumer personal computing products in the world.

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PRODUCTION STRATEGY
Apple’s Corporate Strategy
1. Dominant Business type of diversification: 70% -95% of their revenue comes from a single
business.

2. The dominant business: computer business. Supporting businesses: software and chips
businesses.

3. Related constrained diversification.

Apple’s Business Level Strategy

1. Differentiation strategy.
2. Focuses on high quality and innovation.
3. Offers strong graphic performance with great design.
4. Creates brand loyalty.
5. Products can be imitated at a lower cost structure than apple focuses on superior quality
and innovation focuses on superior quality and innovation.

Apple’s International Strategy

1. Follows a global strategy.

2. Promotes its products worldwide as a standardized product.
3. Uses centralized control to tightly monitor and coordinate their pricing across different
international markets.

Apple’s Cooperative Strategy

1. Uses strategic alliances and joint ventures to enter markets.

2. Alliances with companies like HP and Nokia to promote products
3. Joint venture with Nike to create the Nike+Ipod to further brand recognition in other markets

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 SYNTHESIS

Strengths

1. Strong brand image.

2. Customer loyalty.
3. High customer switching costs.
4. Research and Development.
5. Outstanding financial performance
6. Frequent product introduction.

Weaknesses

1. Dependence on the third party software developers.

2. Products and services experience quality problems from time to time (inconsistency).

Opportunities
1. Increasing demand in emerging foreign markets, for example, China and India.
2. Retail store expansion.
3. Increase lifestyle brand image

Threats
1. Intense competition in the industry.
2. Intellectual rights infringement..
3. Political events, terrorism, etc..

Strengths Weaknesses

• Quality, brand image, global distribution
will address increased emerging market
demand.
• Collaborations to expand lifestyle products
(Apple and Bose) expand market.
• Inconsistent service may turn away buyers.
• A diverse product line (too many products)
does not fit Apple’s “simple” brand and will
turn away buyers.

• Fine management team, innovative • Increased demand for portable devices

and effective Marketing, R&D team and may outstrip production abilities.
large financial resources defend their • Steve Jobs Death is an irreplaceable loss.
position.

Page | 31
STRUCTURING OF ALTERNATIVES
Therefore, Apple needs to further differentiate itself from its competitors by introducing
products that its competitors have not yet developed. Apple is known as a leader for innovation in the
industry; therefore, its future products must have the same “wow” effect for the consumers.
Our alternatives, which will be discussed in our report, will revolve around developing
and maintaining Apple’s image as a leader. The entrance of other players in the consumer electronics
market meant that Apple is getting stiffer competition, especially since these competitors are churning
out smartphones and tablets that are significantly lower in price. Apple CEO Tim Cook, however, is
unfazed by this non-threat, calling these lower-cost counterparts as the “junk market”. According to
Cook, Apple is not catering to this junk market, which is why it opts to stick to offering more
expensive products that have a lot more, and better, things to offer, than what these “junk markets” are
currently fielding to buying customers.
There is no denying, however, that the best product strategy that Apple employs is coming up with very
good products. They call it the “great product” strategy. By continuing to hold on to high standards of
quality, Apple refuses to get on the bandwagon that most other device makers are using, where they
pack their products chock-full of features that, while they may be impressively advanced, actually end
up making operating the device actually more complicated and not at all user-friendly.

Packaging is certainly not an area where Apple is lacking. It is known for being a company that
provides clean and simple, yet functional packaging to its products. More than being flashy, it tends to
boast more of a utilitarian aesthetic, but without coming across as boring or plain.

The “great product” strategy also focuses on quality over quantity. While other manufacturers’
strategy entail churning out products one after another in a short span of time and having such a
diversified product mix, Apple preferred to stick to what it does best. This means that it focuses on
selected products and continues enhancing them, instead of branching out to create other products
within the same category.

If you look at the numbers, it is true that other companies, such as Samsung, are showing higher figures
when it comes to unit sales. They are starting to occupy a larger share of the market. But this does not
worry Apple. Instead, it continues to focus on its loyal customers and, despite occupying a smaller
Page | 32
percentage of the market, is able to position itself as a premium brand and a maker and provider of top
quality products.

As such, Samsung was able to eat up a huge chunk of the market because of its production of cheap
and low-end gadgets. That market is not really what Apple is aiming for, and it is comfortable with the
market it has right now

PROJECTED PROFIT AND LOSS FOR NEXT 3 YEARS

A profit and loss, or P&L, forecast is a projection of how much money a company will bring in by
selling products or services and how much profit you will make from these sales. In good times, we use
it to ensure that there will be enough money coming in to exceed the costs of providing the goods and
services so you can make a solid profit. In tough times, the P&L can play an essential role in showing
what kind of a plan we need to return to break even, so that we are able to survive until better times
come.

● Apple, through several judgemental approaches which estimate the demand so that they can
know the quantity of their products they need to manufacture.
● The second approach is called the tentative method. In this method, the clients’ reviews are
used. A group of customers come together to try how the new product is, as they assess the
qualities and features in it.
● The third approach is the test-marketing approach. It helps in assessing the awareness of the
product.
Since, Apple is respected for its products, an enormous demand is created by the iPhone.
Now, we will see the projected Profit and Loss of Apple.

USD in Millions
PARTICULARS 2020 2021 2022 2023
Net sales 274 515 353 786 366 009 380 573
Operating 66 288 101 118 100 269 100 498
income

Income before 67 091 102 075 100 709 100 459

provision for
income taxes
Net income 57 411 87 004 84 397 85 373

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NET SALES

● It refers to the amount that a company books after deducting returns, discounts and allowances
from gross sales.
● Net Sales = Gross Sales – Returns – Allowances – Discounts
● Apple Inc.’s projected net sales increased from 2020 to 2021; from 2021 to 2022; and from 2022
to 2023.
● The reasons for this gradual increase in projected net sales may be due to the following reasons:
1. Increased number of customers
2. Increased average transaction per customer
3. Raise prices of the products

OPERATING INCOME

● It is also referred to as ‘operating profit’.

● It refers to the amount of revenue left after reducing the operational direct and indirect costs
from sales revenue.
● Operating income = Total Revenue – Direct Costs – Indirect Costs
● Apple Inc.’s projected operating income has greatly been increased from 2020 to 2021; but has
decreased a bit from 2021 to 2022 and slightly increased from 2022-2023.
● The reasons for these differences may be due to the following reasons:
1. If the net operating income increases as a percentage of net sales, Apple turns a higher
profit margin on its revenues.
2. This situation occurs when Apple lowers expenses and generates the same revenue or
when it increases expenses at a slower rate than a corresponding increase in sales.
3. Apple can lower expenses by cutting staff, improving efficiency or not investing in
business improvements.
4. As long as revenues do not fall, the operating income will continue to increase as a
percentage of net sales.
5.

INCOME BEFORE PROVISION FOR INCOME TAXES

● It refers to the amount of income (loss) from continuing operations, including income (loss)
from equity method investments, before deduction of income tax expense (benefit), and income
(loss) attributable to noncontrolling interest.
● Income before provision for income taxes = Revenue - Expenses (excluding taxes)
● Apple Inc.’s projected Income before provision for income taxes has greatly increased from
2020-2021; and then subsequently decreased from 2021-2022 and 2022-2023.
● It is a measure of a company's operating and non-operating profits.

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NET INCOME (PAT)

● It is also referred to as Net Profit or net earnings.

● Net Income = Total revenues - Total expenses
● It is a good indicator of the company’s financial position and ability to manage assets efficiently.
● Apple Inc.’s projected Net income has greatly increased from 2020 to 2021; it is decreasing
from 2021 to 2022 and subsequently increasing from 2022 to 2023.
● The reason for this difference may be that Apple wants to show less profit to reduce taxes.

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CONCLUSION
Apple has an incredible opportunity to end up a pioneer on the Indian showcase. The utilization
of legitimate and successful showcasing procedures can be valuable in drawing in more clients and
making it the advertised pioneer in India. The company ought to alter its approach to the Indian
showcase by considering it as one of the foremost critical markets within the world. The challenges and
openings accessible for all companies working their businesses in India are the same. Samsung, which
doesn't originate in India, has overseen to end up the showcase pioneer within the same environment
where other companies with great items are working. Apple must consider its pricing strategy so that
more clients have to get to its items. Having profoundly estimated items within the showcase as it were
alarms absent clients who may need to utilize items created by a company with notoriety such as
Apple. More critical, Apple seem consider improving its dispersion channels and systems within the
Indian showcase to bring the items close to the shoppers. Utilizing neighborhood retailers who get the
elements of the Indian customers may be a step towards joining client tastes and requests within the
manufacturing preparation. It'll guarantee that the items put on the showcase particularly address the
requirements of the buyers. The think about has appeared that companies working in a remote nation
can seldom be advantaged by their domestic advantage but or maybe must consider each showcase as
one of a kind and create frameworks to assist impel them into getting to be a showcase leader.

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Recommendation
Apple has proved itself to be efficient in penetrating the market with the innovative products that
targeted all consumers the company should thus focus on expansion in the smartphone market the
company must also consider expanding into the low-end segment of the market especially in the area of
portable music devices such as the iPod shuffle This is in the light of the fact that majority of the
products and the business strategy that company has adopted are focusing on the high-end market when
in fact the low-end market contains untapped potential that could provide many sales to the company
this could result in revenue growth Apple could have also differentiate its products in design and
development so that it’s been able to cater for the different needs of various consumer segments.

The company should also consider strategies that will enable it to tap into the business market and
reach agreements with third-party manufacturers so that it can provide synchronized products with
content providers it should also allow for increased personalization such as calendars on its products to
give consumers greater capabilities. Equally Apple should develop the products that have the capability
to work with other equipment like projectors and TV because they are increasingly used in business
presentations and Will help the customer.

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