Competitive Strategy Apple

Question: Discuss about theCompetitive Strategyfor Apple. Answer: The Way Apple has Positioned Itself to take Advantages of Unique Design to Attract Large Niche Market to Surpass the Competition in US and China Brand position of Apple has always been stable and strengthened due to its unique design and product quality. The increasing range of products helped the brand to evolve in the competitive market like China and US (Francis, 2017). It is also identified that the core competence of Apple remains delivering exceptional customer experience through excellent user interface. As the purpose of the positioning itself in niche market, Apple has focused on certain areas of marketing such as the products, branding, pricing and software powerhouse. Firstly, the product differentiation has always been an effective achievable strategy carrying the economic value. This means the brand used the strategy of building itself as the innovator by providing an array of easy-to-use products that cover wide range of segments. The firm has focused on the digital lifestyle strategy by introducing iTunes Music Store gaining the cooperation with top 5 music organizations in the world (Hitt, Ireland and Hoskisson, 2012). This has been a first and unique initiative taken by Apple and it remains as lesson for the competitors. Moreover, in United State and China, the number of competitor of Apple is less due to its high range of products. Apple brought in about $58.7 billion in revenue in China alone in fiscal 2015. Hence, almost 96% of increase has been observed from $29.8 billion in fiscal 2014 (Francis, 2017). Additionally, there is a fact that about half of Chinas population has reliable access to the internet; thereby, the potential for sustained long-term iPhone growth lies directly within Chinas border. In 2015, Apple grabbed almost 94% of the share of US and Chinas smart phone profits by selling tablets and smart watch and increasing Mac unit sales (Hagiu, 2014). In addition, Apple has launched NFS paymen t platform and taken a huge slice of the music streaming market. Furthermore, Apple attempts to maximize the market demand for its products by implementing differentiation strategies that entail making its products unique and attractive to buyers. The products of Apple have always been designed to be ahead of the curve compared to its competitors like Micro-Soft and Samsung. Though the number of competitors is less, the level of competition is high in niche market among the existing firms in US and China. However, in spite of the high competition, Apple gained the success in creating the demand for its products, increasing the power over the price through product differentiation, ensured brand loyalty as well as publicity around the launch of new product. As put forward by Morschett, Schramm-Klein and Zentes (2015), by focusing on the customers intended to pay more as well as developing premium price at the cost of unit volume, Apple developed an artificial entry barrier to rivals. For example, the competitor like Samsung does not use premium-pricing strategy in the large market like US, where consumers are not willing to pay premium price for average quality of products. On the other side, Apple implements a retail strategy known as minimum advertised price. The policy of such strategy prevents dealers from advertising a manufactures products below certain minimum price. Apple developed its popularity of its high-price products by providing retailers such as Best Buy a marginal wholesale discount. Such small percentage is savings does not remain as high profit margin for retailers to provide large discounts on the products of Apple (Francis, 2017). This means consumers tend to pay the price that close enough to manufacture suggested retail price. What does the Apple Experience tell us about the Risks Associated with Strategic Alliances or the Risks Associated with Not Pursuing Strategic Alliances? As put forward by Hill, Jones and Schilling (2014), an organization may have strategic alliance with the other firms to achieve a set of common goals but they are independent firms. This sort of strategic alliance could be made to meet the needs and demands as well as it will not be form of merger or acquisition. The case study on strategic alliance indicates that Apple made the mistake not licensing its operating systems. The brand has only licensed its hardware. Although Apple collaborated with IBM, the organization IBM could not put Apple in the charge of the PC business. It is observed that Apple did not license MAC when it has gained the highest popularity. This has probably been the mistake committed by Appl. Generally, the firms are observed to be licensing the products that have the highest popularity or market demands. If Apple had licensed MAC at that time, it would help the firm to maximize the value of the product in the mind of the customers. As put forward by Hagiu (2014), the when an organization has gained popularity in the market, the customers started relying on the brand for its products and services. Thus, when MAC gained the popularity, Apple would have licensed MAC at that time; Microsoft would not to come into the existence. On the contrary, it has also been observed that designing a product common for global consumers may not hit the market. Hence, Apple is also in the list, as its products face the trouble in the market. Consequently, it would have diversified the risk and especially the financial risks by building a strategic alliance. The case study also indicates that by forming strategic alliance organizations gain the opportunities in increasing values of the products in the market. Moreover, the organizations could easily get into the market to provide their products and services. Hence, Cornelissen (2014) commented that by sharing expertise knowledge, the firms could acquire comprehensive expertise knowledge in their operation. When the organizations form the strategic alliance, it gets the opportunities of developing technical capabilities and the organizations become financially strong. As opined by Hitt, Ireland and Hoskisson (2012) a strategic alliance remains as the sustained competitive advantages, if it is rare, and if is rare and difficult to imitate, the firm has the ability to exploit it. Nevertheless, it can be mentioned that in a competitive market, the organizations should focus on the product that has increasing market demands. Reference List: Cornelissen, J. (2014).Corporate communication: A guide to theory and practice. Sage. Francis, A. (2017).Case Study on Apple's Business Strategies.MBA Knowledge Base. Retrieved 23 February 2017, from https://www.mbaknol.com/management-case-studies/case-study-on-apples-business-strategies/ Hagiu, A. (2014). Strategic decisions for multisided platforms.MIT Sloan Management Review,55(2), 71. Hill, C. W., Jones, G. R., Schilling, M. A. (2014).Strategic management: theory: an integrated approach. Cengage Learning. Hitt, M. A., Ireland, R. D., Hoskisson, R. E. (2012).Strategic management cases: competitiveness and globalization. Cengage Learning. Marketrealist.com.(2017).Apple's premium pricing strategy and product differentiation - Market Realist. Retrieved 23 February 2017, from https://marketrealist.com/2014/02/apples-premium-pricing-strategy-product-differentiation/ Morschett, D., Schramm-Klein, H., Zentes, J. (2015).Strategic international management. Springer. Rothaermel, F. T. (2015).Strategic management. New York, NY: McGraw-Hill.