From

___ _“iCulture”
______ ____
Stems
“A________
Healthier ____
Apple”

Lizzie Lowe
Dan Maslow
Alex Cesan
Whitney Tagliavini
Michael Mitchell
Thesis:
Apple should continue to leverage its
“iCulture” to horizontally integrate through
focus differentiation

Two Future Endeavors:

1) New Products
– Analyze through Porter’s Five Forces

2) Go Green
– Analyze through stakeholder management theory
 History of Apple
• 1976 – Apple was founded 1976
• 1991 – Smooth Success until competition from
Microsoft Windows
– Instead of continuing to innovate Apple sued Microsoft
(unsuccessfully) and sat back on it’s old lines
• 1998 – After a 7 year low stock streak, iMac released
– iMac saved the company and Apple aggressively
innovated
• Today – New products, such as, iPod and iPhone
 “iCulture” Continued
"At the end of day, the whole concept of people experiencing Apple
products and buying more of them is actually happening."
- Gene Munster, an analyst at Piper Jaffray Cos.

- Apple products define an entire generation

- iPod, iPhone serve as status symbols
- “i” prefix has been attached to many words
- Newly nicknamed iGeneration refers to
Generation Y
- New industry has sprung up around
accessories for iPod
- Nike, BMW, Gucci integrating the iPod into
their products
 Five Forces:

PDA and Smartphone Industry

Potential Entrants
-Takes high Funding

Buyers
Suppliers Industry -Low transferability with
-Components Standard -Competition is penalties
-Established Relations on Service -Benefits for Long Term
because of iPod Provider level Commitment
-Few Options

Substitutes
-Possible but Inconvenient
 “iCulture” Phenomenon
 Apple’s three synergetic industries:
 Computers – Mac sales are up 34% from a year earlier
 Portable Music Players – iPod sales are up 17% from a year earlier
 Smartphone – iPhone’s overperformance already
Apple’s September Quarter Revenue and Earnings was Highest Ever

iPhone Customer Base

50+, 6%

15-24, 31%
15-24
35-49, 31% 25-34
35-49
50+

25-34, 32%
iPhone Success • Sold 1 million iPhones on September 9th
– 21 days before projected date
iCar – Attractive Industry or not?

Firm infrastructure
Support
Activities Human resource management

Technology development

Procurement

Inbound Outbound Marketing

logistics Operations logistics and sales Service

Primary Purchases
small
Specializes
in efficiently
Distributes
large
Strong
marketing
Strong customer
service department,
Activities electronic
components
mass-
producing
shipments
of products
division and
heightened
but not accustomed
to automobile
consumer to retail brand loyalty industry
electronics stores

8
 Making of
“A Healthier Apple”
• Green History
• Utilized Accommodative Stakeholder Management Approach
» Many environmental “milestones” actually mandated by law
» Ranked 12th amongst 14 largest electronics manufacturers by Greenpeace
• Three Major Green Issues
» Prevalent use of toxic chemicals (i.e. PVCs/BFRs)
» Large amounts of e-waste (20-50 million tons yearly)
» Overall apathy and lack of innovation in green product design

• Steve Jobs- “A Greener Apple”

» “…I was surprised to learn that in many cases Apple is ahead of, or will soon be
ahead of, most of its competitors in these areas.”
» Full of fluff and illogical comparisons to competitors
» Few notable promises- phase-out of PVCs and BFRs by 2008/strenghten recycling
efforts, etc.
 Going Green
• “iCulture” is trendy
- Trend right now is to go green
- Consumers becoming environmentally conscious
• Going green is a new market
- Demand for environmentally friendly houses, cars, food
- Companies with environmentally friendly products can profit
- Green products enable businesses to expand in saturated markets
 “A Healthier
Apple”
The Steps to a Proactive Positioning

– Progress Underway
– Leverage the “iCulture”
– Strategic partnerships with:
• Join Conservation International
• Advertise the iTune’s Song of the Week
in Starbucks stores                                                                 
• PepsiCo’s Products 08 March 2005 –Guiyu China
A migrant worker strips plastic from wires to extract
– free iTunes Songs useful metals. However, this PVC plastic is toxic
and when burned, a huge pollutant.
on Package www.greenpeace.org/international
.
“A Healthier Apple”
• “Greener Apple” Product Initiatives
– Granny Smith® Color added to each iPod line
– “Greener Apple” Song of the Week on iTunes

• Joint Ventures
– Starbucks
– Have the Song of the Week “Green Cards”
– Agreement with Artists that purchase of song on
iTunes goes directly to Starbucks foundations
– PepsiCo - “Performance with Purpose”
– Already a member of Conservation International
– Co-brand list of products
» Quaker Oats Oatmeal, Gatorade
– Free iTunes Song with purchase
and 10% of proceeds go to Conservation
International