Apple's SWOT Analysis

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How can Apple counter the intense smartphone competition especially in China and Market its new products including Apple Watch to mark the transition of the company from the former deceased Chief Executive Officer (CEO) to the new CEO Tim Cook?

In 2015, Apple Company experienced an impressive momentum since the stock performance was excellent. However, it faced various challenges in facilitating its operations. First, there was intense smartphone competition across the globe, but majorly in China. China introduced new low-cost products including Xiaomi, which were taking over the market. Such products led to further decline in the sales of Apple’s products such as iPad, which has had declining sales from past seven years. The sales of iPad went down by 22 percent affecting the company’s revenues. Apple’ product, iPhone that formed 69 percent of its income was the only product the company that could sustain the company. In response to this situation, Apple introduced a new product, Apple Watch. The new product posed the challenge as to whether it could penetrate the market and improve the revenues. It was as well meant to mark the transition from the former CEO Steve Jobs to the Current CEO Tim Cook. Therefore, it was a product launched by Tim Cook.

Alternative 1: Introduction of a New Product

According to this alternative, it was only written for Apple to introduce a new product within its lines of the smartphone. Xiaomi, a new player in the market was taking over as it was offering inexpensive phones with high-end specifications. In response, to this challenge, it was advisable that Apple purchases Nokia’s devices including Nokia’s Lumia line of smartphones. It then had to introduce this device as its new product in the market. The Nokia device was to run smartphones’ of Apple operating system under its brand. In addition, in dealing with the competition challenge, the company had to give license of its software to other vendors including HTC and Samsung. Apple as well had to introduce more apps in its App Store to generate more revenue from downloads. It was as well necessary in dealing with the competition from the Play Store, which was introduced in 2008.

Alternative 2: Introducing New Technology to Improvise iPad and iPhone

To make iPad and iPhone competitive in the market, Apple has to make them more efficient and advanced technologically. For instance, the creation of an iPhone with a 3.5-inch touch-screen interface structured command helped to reform the smartphone industry. It could make it possible for the users to make commands using fingerprints and not physical keyboards. In addition, the iPhones required a new version of OSX referred to as the IOS. Smartphone users will find this advancement intuitive and attractive. Other new technologies that were needed for the company to attain a competitive advantage especially in China include Siri, which is a voice-activated technology. With Siri, iPhone users could dictate texts, ask questions and schedule appointments using voice commands. Through this, the efficiency of using apple smartphone is improved.

Alternative 3: Moving beyond Smartphones (iPad and iPhones)

This alternative suggests that to stabilize the company’s revenues and competition level across the globe it has to move beyond smartphones and introduce other gadgets. The new product that was launched by the current CEO, Apple Watch plaid a crucial role in redefining the company. Apple Watch changed the digital market as it entailed stunning features. The company had to ensure the product is admirable through its features to penetrate the market. In doing this, the Watch was to contain features such as advanced watch apps, upgraded payment systems to facilitate its purchase, social media and have programs that enable the users to attain healthy lifestyles. Therefore, this product improved the revenues of the company ad redefined its management.

Solution: Alternative 1

Looking at Apple’s SWOT analysis, there are strengths that enable the company to withstand all the forces within the economic environment. These strengths can reduce the threats that affect the organization performance. They include high-profit margins, strong brand image, and effective innovation programs. Apple is one of the most influential brands across the globe according to the SWOT analysis. The analysis as well shows that the company is capable of introducing new products, which are profitable into the market. Its brand image is stable, and therefore any product it launches will always attract high demand in the market leading to high profits.

The SWOT analysis as well points out certain weaknesses that can be resolved by ‘alternative 1’. The most dominant weakness is apples high selling prices, which can be addressed introducing new products. The new items will increase the company’s revenues leading to fair and affordable prices. For instance, the new Apple Watch has increased the company’s revenues. With the introduction of new items, apples attract many opportunities such as rising demand for its other products apart from the new ones and distribution network expansion.

Further, the new products can help Apple Inc. to deal with the market threats such as aggressive competition and rising labor cost. The organization’s increasing capital and high-profit margins resulting from the introduction of new products will facilitate the labor costs. In dealing with the stiff competition in the market, it will be appropriate to introduce better and advanced products to the marker. The SWOT analysis indicates that the company has immense strengths that can be used to address organizational challenges. Further, the company can exploit the opportunities it has to expand.


January – May 2016 Research Planning:

Apple should come up with a tax-force of not less than 20 experts, which takes the responsibility of identifying the new products that can be produced by the company to sustain its revenue state. The task force will be expected to develop an investment plan, select the right approach and come up with the target market for each of the new product. It will as well have to attain access to the company’s resources such as innovation programs in concluding as to what products to produce and the right time for such a process.

May-December 2015 identifying strategic partnership:

Apple needs to develop strategic partners who can help in facilitating various operations necessary in producing the new products. First, the company must identify the partners who can provide active distribution networks. The other factor is the promotion of the new products. In doing this, Apple will require services of other corporations especially the website organizations and even other brands that specialize in that area. Lastly, the company must have the capacity to satisfy the needs of the customers, and in doing so, it must collaborate with other organization on a contractual basis.

October – November 2016 Production and Performance analysis: After identifying the necessary resources and partners the company has to commence production of the new items. The production will run efficiently since the required process such as finance and human resource are already availed. The production will have to be continuous for a specified period; it could be four months after which a performance analysis should be conducted. The performance of the new items in the market will be analyzed as to whether they are as per the expectations set.

January 19, 2024

Business Economics

Subject area:

Apple Company

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