Apple Music's service costs the user 9.99 per month, and the platform is already installed onto each Apple product, to make it easily available to consumers. Business Failures This allows Google to widen its VA product ecosystem. If you want to find out more about the SWOT of Apple, youre in the right place. Available at: Apple, Inc. (2020). Refunds and Policy While this strategy may have served them well in the past, it is becoming increasingly evident that relying exclusively on brand recognition will not be enough going forward to keep abreast of rivals rapidly developing products and services. Apple Inc. For example, Apple could focus on increasing its presence in emerging markets like India, with a growing middle class with increasing purchasing power. Competitors such as Samsung, Google, and Microsoft have developed their own innovative products that compete directly with Apples offerings. })(); Copyright 2019 Daniel Pereira - The Business Model Analyst. Apple is operating in the technology industry where competition is often based on patents. Since 2014, Apples dependence on iPhone sales grew from 55.8% to 61.6% in 2017 and again declined to 54.7% in 2019. perform swot analysis for google. Competition in various industries can be seen as one of the greatest risks that Apple has faced over the years. Swot Analysis Examples With over 1.8 billion active devices expected to be in use by 2023, Apples colossal size and reach are unparalleled amongst technology firms around the world. Company This means that customers must purchase Apple products in order for them to be used together without any modifications or additional software purchases. Augmented Reality and Virtual Reality Market by Offering, Device Type, Application, and Geography Global Forecast to 2023. In 2019, Apple is still the major premium smartphone and tablet company, with very high average selling prices for its products. The major key weaknesses include lack of distribution channels in the countries and high price which can be overcome. Apple SWOT Analysis | Free SWOT Analysis The SWOT or strategic analysis of Apple showed that the major key strengths of Apple Inc. that comes from the quality and uniqueness of the Apple iPhone. #gap-325806325 { Mature markets: as Apple music is part of the mature market community it will therefore be challenging to sustain their growing market. Proficient Research & Development 6. Over the past 10 years, Apple has infringed many patents and has had to pay damages accordingly. --divider-top-width: 100%; --divider-width: 100%; It has introduced many breakthrough products to the market, such as the iPod, iPhone and iPad. Apples ability to retain its customers and do it so well brings it a competitive advantage no rival can match. Apple is a market leader in the technology industry for a reason; its high-quality products are extremely popular among consumers. I've created a SWOT analysis to make clear what aspects both companies have to their advantage and disadvantage. A SWOT analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats of a business, project, or individual. Except for Google and Samsung Electronics, few other companies could seriously attempt to challenge Apples competitive advantage. window.mc4wp.listeners.push( Conclusion 1. color: rgb(255, 255, 255); For example, if consumers begin to favor more affordable or customizable products, Apples premium pricing and closed ecosystem could become a liability. Personally I believe his influence within the music platform such as within Beats one generates a serious amount of hype and will continue to do so in the future. Innovation challenges: While Apple is known for its innovative products, it has faced criticism recently for a perceived lack of innovation. Apple has been successfully competing in China since entering the market in 2009. Services: The services business of Apple, which includes Apple pay, Apple Music, and the App store, is growing rapidly and is a possible source of revenue for the firm. [23], A research done by Research and Markets[20], indicates that AR market could be worth US$60.55 billion by 2023, growing on average by 40.29% every year. Iniciar sesin Registrate. } Since then, smartphones have improved a lot. Apple Inc., established in 1977, is the largest technology company by revenue and one of the most valuable companies, both in terms of market capitalization and brand value, in the world. Concepts Currency exchange rates affect every multinational company, including Apple. New services: apple music can benefit and learn from new services to help diversify their customer base, International expansion: given Apple music is already international this means it can reach a wider audience and expand their business. A strong dollar does not only decrease the profits from foreign countries but also makes the companys products more expensive and less attractive to the customers abroad. Their strong brand recognition and diverse product portfolio give them an advantage over competitors. Soundcharts is an analytics tool that tracks more than a thousand Apple Music charts in one analytics dashboard. In particular, the Company has historically faced a significant number of patent claims relating to its cellular-enabled products, and new claims may arise in the future. Even with the lowest R&D budget, Apple was still able to generate more revenue than any of its rivals. Claims against the Company based on allegations of patent infringement or other violations of intellectual property rights have generally increased over time and may continue to increase. text-align: left; 2016 Winning Brands Brand Keys Customer Loyalty Engagement Index. Strong Brand Value According to Interbrand's Best Global Brands 2022 ranking, Apple won the title of top global brand for the tenth consecutive year with a brand value of whopping $482,215 million. Three month trial of Apple music will entice customers to test the service before making a decision to pay. @media (min-width:550px) { It involves identifying the internal and external factors that can affect a ventures success or failure and analyzing them to develop a strategic plan. This has been especially seen regarding their battle with Qualcomm Inc., where each company sued the other over various patents, resulting in long-term costs and delays while trying to reach an agreement between the parties involved. Who Owns The company was also the only one which could provide the best quality products with a great ecosystem. While Apple is a highly successful brand with many strengths, the company also faces challenges and weaknesses that it must address to maintain its position as a leader in the technology industry. Apple music debuts music at 256kpbs which is although the same as iTunes. 50%+ Apples revenue is generated from the sale of the iPhone. It is not expected to be as huge as the AR market and currently there are no signs that Apple will be venturing into it. Apple is finding it very hard to differentiate its iPhones through incremental hardware improvements, as are other smartphone manufacturers. Several reports have emerged accusing iPhone of threatening to withdrawal their support on specific music labels. While this strategy has enabled the company to maintain its market share, it also restricts compatibility with other devices. Hardware can be connected and controlled through only one VA and accessed almost anywhere in a house. #col-1823339708 > .col-inner { Available at: Christensen, N. at Kitco (2019). Leave this field empty if you're human: Bundles } The companys commitment to providing excellent customer service and quality devices has earned its loyal fans, as well as a massive following on social media platforms such as Twitter and YouTube. The service includes curated internet radio such as Beats 1 which is driven by the respected Zane Lowe and his hand picked team of renowned DJs. Research finds Apple music could not convince the record labels to charge any less. [34] Android also closes the quality and user experience gap between it and iOS through constant improvement. -Beats 1: a 24/7 radio driven by Zane Lowe features an all around the clock live broadcast from DJs based in Los Angeles, New York, and London. [1], Apple operates and sells its products in over 100 countries, but the U.S. China, the U.K. Canada and Australia are the most important markets. This Apple SWOT analysis reveals how one of the most successful world's companies used its competitive advantages to become the dominant player in the tech industry. Apple services are not just confined to iPhones, MacBooks, and ipads. Moreover, their long-term strategic investments hint strongly at a continued commitment to becoming a major player in the content streaming space. This is where a strong U.S. dollar, or in other words, the currently rising U.S. dollar exchange rate damages companys financial position. height: 150px; padding-top: 0px; Cheaper hardware also tends to mean reduced quality, and customers may end up having a negative experience when using these knockoff items. } #col-1823339708 > .col-inner { } This Apple SWOT analysis will help us in determining what makes Apple such a big name in . Theres no guarantee that Apple, willingly or not, will not breach more patents in the future, resulting in damages that have to be paid and the associated negative publicity that would hurt the companys reputation. Innovative products: Apple is known for its innovative products that push the boundaries of technology and design. Fortune Global 500. } color: rgb(255, 255, 255); Subscribe now and don't miss any new posts! There is massive potential for both VR and AR applications across industries such as entertainment, education, and retail experiences; this has led many top brands like Apple to explore ways they can incorporate these technologies into their product lines. The plaintiffs in these actions frequently seek injunctions and substantial damages.[1]. The Wearable Life 2.0. In addition, Apple should improve and strengthen its R&D capabilities and introduce more innovative products to the market. Integration of AI and machine learning: Artificial intelligence and machine learning are becoming increasingly important in the tech industry, and Apple has an opportunity to integrate these technologies into its products and services. This would strengthen the companys ecosystem and provide a better user experience. } Apples retention rates in the smartphone market are the highest among its major rivals. Spotify is the leader in music streaming. Despite those competitive advantages, Apples products and services are seen as luxury items that only rich people in China can afford. Top Technology 4. Apple is known for producing high-quality, innovative products focusing on design and user experience. Apple is actively fighting against this problem, but it persists as counterfeiters continue to find ways around their efforts. At the beginning, most smartphone manufacturers were competing with each other based on hardware, design, software and additional services. In recent years, Apple has seen its market share reduce as other competitors emerge. padding: 30px 0px 0px 0px; In 2019, the U.S. dollar increased in value against other currencies for the second consecutive year. Change), You are commenting using your Twitter account. Apple Inc. SWOT & PESTEL Analysis are popular since the company is among the most prominent firms globally, best known for its sleek designs . Several threats could potentially impact the Apple brand: Overall, while Apple is a successful brand with a strong reputation and loyal customer base, the company faces a range of threats that it must navigate to maintain its position in the market. Since its inception in 1976, Apple has become synonymous with high-quality products that are unique yet easy to use for customers across all demographics and segments of society worldwide. 2019 Winning Brands Brand Keys Customer Loyalty Engagement Index. With their solid customer base and industry-leading hardware platform, they have been able to quickly establish a dominant position within the digital media market. } Available at: PwC (2016). } Brand loyalty: Apple has a loyal customer base willing to pay a premium for its products. Privacy, data security, or antitrust regulation changes could impact Apples business model or require the company to change its products or services significantly. Apples brand recognition extends to its App Store, making it easy for new users to find the apps they need quickly. Available at: Wang, Y (2017). Natasha Mascarenhas. SWOT Analysis of Apple 3. padding: 0px 0px 0px 0px; Apple Swot Analysis - Internal & External Strategic Factors Business Updated on April 7, 2021 Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne in April 1976. The potential for government agencies to access user data stored on the iPhone through backdoor mechanisms is a significant threat facing Apple. Similarly, their services, such as iCloud storage and iTunes, also have higher prices than competitor versions. ); color: rgb(255, 255, 255); [1] In 2019, the company introduced three new iPhones: iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max. Expansion into new markets: Apple has a strong presence in many of the worlds largest markets, but there are still many untapped markets that the company could expand into. There are many large and well-positioned rivals in the industry, so a fierce competition requires constant innovation and taking advantage of the arising opportunities. RECEIVE OUR UPDATES Worldwide Spending on Augmented and Virtual Reality Expected to Reach $18.8 Billion in 2020. Apple SWOT Analysis 2022. Worldwide Wearables Market to Top 300 Million Units in 2019 and Nearly 500 Million Units in 2023, Says IDC. by Scotty Soul) 13. Other external factors, such as rising inflation rates, could also affect consumer spending power, which would further reduce demand for luxury items such as those offered by Apple, thus reducing profits earned by the company as well as overall revenues generated over time through digital payments. What does Apple do | How does Apple make money | Business Model. SWOT Analysis of Apple Inc. for 2021. Intense competition: competition from other streaming services such as from Spotify could threaten Apple musics profit. The Worlds 50 Most Innovative Companies 2019. [15]. May 3, 2021 by Brandon Gaille. The highly competitive environment in which Apple operates often leads them into legal battles with other tech giants or patent holders over intellectual property rights or trademark disputes. These could be further improved to monitor and store various health data. color: rgb(255, 255, 255); I have chosen Apple for this analysis. By capturing only 10%-20% market share the company could potentially earn US$6 billion to US$12 billion in additional revenue with an enhanced Apple Watch device. Improved smartphone and wearable technologies have given rise to many opportunities for Apple. Other currencies therefore have to be converted to the U.S. dollar in order for the company to be able to calculate its total revenue and transfer its profits back to the U.S. Most businesses try to diversify their revenue sources for a few reasons. The software comes pre-installed on all Apple music devices whilst also available as a free download. Design excellence: Apples products are known for their sleek, elegant, functional, and aesthetically pleasing design. } Augmented and virtual reality markets will be worth US$104 billion by 2023, 1. Want Receive new Business Model Analysis direct on your inbox? It became the companys second largest market in 2011 and is the only country besides the U.S. that generates over 10% of its revenue. (LogOut/ The companys brand is associated with quality, innovation, and a commitment to customer satisfaction, which has helped to build customer trust and loyalty. Available at: Alphabet Inc. (2019). It has a loyal customer base that continues to grow due to its innovative products, design quality, and user experience. @media (min-width:850px) { Apples excellence in creating spectacular marketing campaigns, its superior advertising capabilities, premium quality products and ability to deliver an excellent customer experience has allowed the company to build the most powerful brand in the world. For example, Apple could explore new product categories like augmented or virtual reality or develop new software or services that complement its existing product line. #section_964939376 { A report from Meticulous Research predicts that the global wearable medical devices market will reach US$62.82 billion by 2025.[31]. [16] It is also the second largest premium smartphone market, which is the Apples main target market for its products and services. The companys revenue declined by 2% or US$5.6 billion in 2019, mainly due to the 13.6% or US$22.507 billion decline in iPhone sales. The Company is vigorously defending infringement actions in courts in several U.S. jurisdictions, as well as internationally in various countries. Form 10-K for the Fiscal Year Ended September 27, 2014. U.S. Dollar can still roar in 2020 even as it ends 2019 with a whimper. Available at: Statista (2019). Apple SWOT Analysis Apple Inc. is an American multinational technology company that designs, develops, and sells consumer electronics, computer software, and online services. Available at: Wollerton, M. at Cnet (2019). This is currently the most important and profitable opportunity Apple should pursue. Why is this such a major weakness for the company? Figure 6. [3] The company has revolutionized the smartphone market and has created one of the most iconic brands in history. This, as well as Apple musics financial leverage helped me to infer that the platforms success will be highly driven by respected artists with big fan bases. Google with their Android operating system, Business Model Canvas: The Definitive Guide, Business Model What is it and How it works. When considering Apples strengths, it would be remiss not to mention the companys leading technological edge. On demand streaming: All you can eat service including Apple musics extensive 30 million song library (given you pay the flat fee of $9.99 a month). } Available in 100 countries as opposed to 58 for Spotify. Any change in the economic, social, political, technological or environmental factors may negatively affect products sales. Regulatory changes: Apple is subject to various regulations and laws governing the technology industry. The companys closed ecosystem can make it difficult for users to switch to other platforms or devices, limiting their options and reducing their ability to customize their experience. Smartphone designs are also getting more similar. This includes investing heavily in research and development so that novel technologies can be quickly brought into production for use within its hardware devices, as well as software applications for both macOS and iOS platforms so that users can get more out of them than ever before. Available at: Brand Keys (2016). iPhones, Macs, iPads, and other hardware items like AirPods and the Apple Watch are especially pricey compared to other options similar in features. } First, according to Tim Merel from TechCrunch[25], the AR market needs to overcome 5 obstacles to become a mass market: With an introduction of an iPhone 11 and the companys recent acquisitions of PrimeSense, Metaio and RealFace companies, who all work on various 3D technologies and face recognition, the company is now capable to overcome all 5 obstacles. callback: cb They face fierce competition in the names of Spotify, Napster and many more. Development of new products: Apple has a long history of developing innovative products, and there are many areas where the company could continue to innovate. As for a leading company in technology domain, Apple enjoys a great part of market share, and its users are all over the world. Figure 7. Apple SWOT analysis framework is a strategic management decision-making technique that identifies the firm's most important issues based on internal and external business conditions. Available at: Fast Company (2019). Apples low R&D spending shows how effectively its R&D budget is managed. How about the virtual reality market? Over the next few years, Apple will continue to grow successfully. I explore Apple using a Strengths, Weaknesses, Opportunities, and Threats (SWOT) model. color: rgb(255, 255, 255); Soundcharts compiles all these Apple Music statistics, creating a comprehensive summary of all current and historical charts positions, updated in real-time. The company is well aware of the opportunities that augmented and virtual reality markets have to offer. But no business is immune to external or internal factors that can have a negative or positive impact on their operations and bottom line. An ecosystem of products and services: Apple has created a cohesive ecosystem that works seamlessly together, making it easy for customers to integrate Apple products into their lives. Apple is regarded as the tech industry's pinnacle of innovation and the most powerful company in the world. Apples product ecosystem is comprised of: Apples ecosystem is the result of the companys ability to design a wide variety of integrated proprietary hardware, software, applications and services. The main companys product is iPhone, which runs on Apples iOS operating system and accounts for 54.7% of the total companys revenue. { Connect: a social networking feature, which lets fans follow artists. To diversify their revenue sources for a perceived lack of innovation and the most iconic Brands in history design... Budget, Apple will continue to find the apps they need quickly willing to damages! Positive impact on their operations and bottom line many opportunities for Apple that... 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