individual group international business strategy apple inc

Industry: Apple operates in the technology industry, primarily focusing on consumer electronics, software, and online services.. Main products and services: Apple offers a wide range of

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INDIVIDUAL GROUP INTERNATIONAL BUSINESS STRATEGY

Lecture: Bui Thuy Duong

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I COMPANY PROFILE 4

1 Background 4

2 Mission, Visions & Values 4

3 Scope of Apple analysis 5

II ANALYSIS 6

1 Environment Analysis 6

1.1 Demographic Trends 6

1.2 Social-culture influences 6

1.3 Political-legal pressure 7

1.4 Global trade issue 7

1.5 Macro Economics impacts 7

1.6 Technological development 8

2 SWOT Analysis 9

2.1 Strengths 9

2.2 Weaknesses 11

2.3 Opportunities 13

2.4 Threats 14

3 Porter's Five Force Analysis 15

3.1.Threat of Entry 16

3.2 B gaining Power of Buyers 16ả 3.3 Bargaining Power of Sellers 17

3.4 Threat of Substitutes 17

3.5 Intensity of Rivalry 18

IV CONCLUSION 18

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VI GRADES ON GROUPMATES 21

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1 Background

Company's name: Apple Inc

Establishment year: Apple Inc was founded on April 1, 1976

Headquarters: Apple Inc.'s headquarters is located in Cupertino, California, United States Industry: Apple operates in the technology industry, primarily focusing on consumer electronics,

software, and online services

Main products and services:

Apple offers a wide range of products and services, including iPhones, iPads, Mac computers, Apple Watches, Apple TVs, AirPods, HomePods, iCloud services, iTunes, the App Store, Apple Music, and various software applications

Target market: Apple targets a broad consumer market with its products and services It caters to customers across different age groups and demographics, including individuals, professionals, and businesses [1]

Operating country: Apple operates globally, with its products and services available in numerous

countries around the world It has a significant presence in the United States, Europe, China, and other major markets

2 Mission, visions and values

Vision: Apple's vision is to create innovative products that enrich people's lives

Mission: Apple's mission is to bring the best user experience to its customers through its

Innovative hardware, software, and services

Message: Apple's message is about simplicity, elegance, and ease-of-use The company strives to make technology accessible to everyone

Inclusion and diversity: Apple values diversity and inclusivity, both in its workforce and

in the products it creates

3 Scope of Apple analysis

In this analysis, the scope will focus on the global market of Apple Inc This means looking at a company's activities, products and services on a global scale By analyzing Apple's global presence,

we can better understand the overall position in the industry, the competitive landscape, and the opportunities and challenges in the market

Figure 1: Global smartphone market share (Q2 2021 Q1 2023) – [2]

1.2 Social- culture influence

Socio-cultural factors include consumers’ lifestyles, buying habits, education, religion, beliefs, values, demographics, social classes, and attitudes These factors determine the suitability of an organisation’s products and services for its customers’ needs Apple Inc has succeeded in using environmental factors flexibly

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China there is a legend that tells the story of a young man, his love for opera and his enduring spirit What's more special is that this entire video was shot entirely with Shot on iPhone 14 Pro The nearly 18-minute video was shot on an Iphone 14Pro for Apple to highlight all the new camera features available on this phone This ad has brought Apple's great success in the Chinese market- Public Technology Environment [5]

1.3 Political- legal pressure

The instability and rapid political change between will create a risky environment for business because each country has different laws and regulations For example: Chinese decided to raise tariffs on some U.S goods after President Donald Trump threatened to further raise tariffs on Chinese import The political war is affecting a lot of different stocks, but Apple seems to be hit harder than most because Chinese market is Apple's 3rd largest consumption market after the Americas and Europe and assembles its iPhones primarily in China This tax imposition could reduce iPhone sales by 6 - 8 million in the US in 2020 This means that Apple's income could drop

by up to 4% [6]

1.4 Global trade issue

Apple's value drops as interest rates, supply woes and recession fears batter tech industry Tech companies face strong headwinds from higher interest rates, production problems and global economic concerns, investors selling off shares Apple stock has lost $1trn (£829bn) from its market value, meaning there are no longer any tech companies worth more than $2trn (£1.65trn) Apple too struggled with production in China, and in November said it experienced "significant" disruptions with iPhone assembly after a COVID-19 outbreak [8]

1.5 Macro economics impacts

Inflation is a critical macroeconomic factor that can influence the supply and demand of the Apple Gross Domestic Product is the second factor that will influence the iPhone in that an increase in GDP in the US means that citizens are making more money, thus have more purchasing power to buy Apple’s product The third factor in macroeconomics in regards to the US that could affect the Apple are geopolitical factors With the vast majority of production in China, any shift in politics by either the US or China towards each other could have huge impacts on the company supply The trade deficient between the US and China is now in the hundreds of billions of dollars,

in the sense that the US imports much more from China than exports to it The United States is the

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in that could be catastrophic for the US and its economy For Apple, this would signal a drop in supply and demand The supply will decrease as demand in the US will decrease because in the event of a ruined economy, no one will be able to buy an iPhone [9]

Figure 2: Critical Macroeconomic Outputs [12]

1.6 Technological development

Technology is increasingly changing the way many businesses operate today Machine learning, big data, and artificial intelligence are some of the most important technological advancements Apple has recognized and incorporated these advanced technologies into its products In June 2020, when Apple announced the iPad, macOS, and iOS operating systems, they hinted that some of the updates and features had machine learning and artificial intelligence Apple has also used artificial intelligence to help users track their sleep Through the Apple Watch, machine learning can classify a user's movements and detect if they're asleep and for how long Or like Homekit - a smart home solution, Apple has also allowed Homekit-enabled security cameras to use photos tagged on the user's phone for identification [10] Influential technology companies like Apple have had a significant positive impact on society today Specifically, iPhone has replaced many other gadgets, making it an irreplaceable item in an individual's daily life, the products that have

Strong Brand Recognition

Apple is one of the best-known brands in the world Apple is ranked #1 position for the 9th consecutive year by Interbrand with a brand value of $408 Billion Followed by Amazon ranked –

at #2 with a brand value of $249 Billion, and Microsoft ranked at #3 with a brand value of $210 Billion [14]

Loyal Customers

It has a loyal customer base that continues to grow due to its innovative products, design quality, and user experience According to a report from research group CIRP, Apple maintained a loyalty rate of more than 90% for the past three years The calculation was based on the percentage of new iPhone customers who upgraded from a previous iPhone model [15] Apple’s brand recognition extends to its App Store, making it easy for new users to find the apps they need quickly This can

be seen by the sheer number of downloads that app developers receive for their apps on the App Store- many developers report a huge increase in sales when releasing an app on Apple’s platform compared to other platforms This is partly due to iPhone being more popular in regions with high income, such as Japan and the United States, which also tend to spend more on apps [16,17]

Innovative Products and Services

In 2021, Apple Inc ranked first among the 50 most innovative companies in the world selected by Boston Consulting [18] Apple Inc can maintain a high growth rate for a long time because of its unique innovation ability, including product innovation and process innovation For example, Apple Inc reformed the design and production of all-in-one machines, using hard disks instead of memory to make MP3s and so on As Apple Inc's core competitiveness, these innovative reforms assisted Apple Inc in quickly occupying and maintaining its leading position in the industry This has brought huge profit margins and market influence to Apple Inc and provided a substantial basis for Apple Inc's future market expansion and strategic transformation plan Also, when it comes to mobile devices, iPhones were one of the first mobile phones that allowed access to internet

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anywhere, through their phones themselves

Figure 3: Latest earning report of Apple [20]

Leading Technology Edge

When considering Apple’s strengths, it would be remiss not to mention the company’s leading technological edge As one of the most innovative tech giants of the modern era, along with Amazon and Google/Alphabet Inc., Apple continually sets new trends when it comes to technology development From introducing groundbreaking features like facial recognition through Face ID (iPhone X) or augmented reality apps through ARKit (iPhone 8), Apple pushes boundaries by bringing state-of-the-art solutions into consumer markets faster than any other competitor can keep

High-Quality Products with Unique Features

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

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The company’s 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

From iPhones to iPads, MacBooks, and much more, their product range is extensive enough for everyone, from kids, just starting out using computing devices up to more experienced professionals looking for the latest technological advancements found only within Apple products The features included both on a software and hardware level within these devices make them stand out against competitors

Proficient Research & Development

Apple puts dedication into its product designs Careful study and extensive research are performed

to help understand customer needs and market trends Apple continues to invest a substantial amount of money in research and development for future growth and a competitive edge For example, Apple spends $26.25 Billion (about 7%) of its revenue on R&D [19]

Expansion in services

Apple has been expanding its services portfolio for many years For example, about 20% of Apple’s annual revenue ($78 B out of $394 B in 2022) came from its services, which is the second biggest contributor to its revenue after the iPhone (52% of its revenue) [20]

Apple’s services include digital content stores, streaming services, iCloud, AppleCare, payment services, etc Recently, Apple has introduced many new services, such as Apple TV+, Apple News+, Apple Card (credit card services), Apple Arcade (game subscription), Apple Fitness+, etc [21]

2.2 Weaknesses

Expensive products and services

Apple Inc is known for high-quality products, but they come at a cost that is more expensive than most competitors IPhones, Macs, iPads, and other hardware items like AirPods and the Apple Watch are especially pricey compared to other options similar in features Similarly, their services, such as iCloud storage and iTunes, also have higher prices than competitor versions The more significant financial commitment needed to purchase these products and services puts them out of the reach of many consumers [22]

Limited advertisement & promotions

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resources Apple's marketing relies heavily on its iconic and flagship retail stores We can also see that Apple rarely has promotions, or discount vouchers to attract customers Because of their success, Apple does not feel the need to have excessive spending towards advertisement in comparison to another big brands

Incompatibility with other software

When a customer buys an Apple product, they enter the Apple universe Apple’s products do not support other software or technologies making them incompatible with other devices Customers have to exclusively purchase Apple apps or accessories to continue using their Apple products

Lack of new innovative products in recent years

In recent years, Apple has not been as successful in introducing new and innovative products as it had been in the past Rather than developing revolutionary pieces of technology like their iconic iPod, iPhone, and iPad, their more recent releases have tended to have features already found on earlier models, which makes it difficult for them to stand out and garner a new customer base We can easily see this in some of the iPhone products that Apple has launched recently Although the iPhone 12, iPhone 13, and iPhone 14 lines were born a period of time apart, their external design has not changed Meanwhile, Samsung has launched many generations of folding-screen smartphones

The high degree of litigation

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 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

Recently, in October 2022, Apple was fined $19 million by the São Paulo State Court because of its decision to remove chargers from iPhone packages These are just a couple of some litigation over the past few years [23]

Allegations of Tracking

Tracking users undermines trust Apple has been accused of using tracking apps on its phones, which revealed the precise location of users Even though the latest version of Apple’s phones gives users the right to decline tracking, trust is difficult to regain once it is lost [25]