Analysis SWOT Iphone 4 - Essay Example

?Introduction Apple Inc is one of the leading consumer electronics companies in the world offering mainly computing related consumer goods and services. Based in US, Apple started as a computer manufacturing firm offering its own hardware and software to run on the computer machines manufactured by Apple itself. However, over the period of time, Apple has evolved and successfully transformed itself into an electronic manufacturing firm offering laptops, MP3 Players, Smartphones, tablets, TV devices, monitors and other electronics items. Apple has now become a brand name to reckon with and has successfully developed and launched products like IPOD, Iphone and IPad which are generating billions of revenue for the firm every year. Apple’s target market is often young and middle aged adults looking for excitement on the go and it’s because of this reason that Apple has developed products which offer the entertainment element on the go. Consumers can rip their music, videos and photos on their devices and carry them and use them wherever they go. Apple has also attempted to target young professionals by offering them products like Apple IPhone and Apple IPad to check their emails, surf internet as well as watch videos and movies anywhere anytime. The overall marketing mix of the company is based upon offering premium products through its own chain of stores and other partners besides having an online store. Further, the brand recognition of Apple has reached to a level where its products are self selling in nature. This report will present a situational analysis of one of its newly launched products i.e. Apple Iphone 4 with special reference to London, UK. Situational Analysis This section will discuss both the internal as well as external environment of Apple Iphone 4 with first section will be on the assessment of the internal environment. Internal environment Iphone 4 is a sequel to the much successful Iphone product line of Apple which has overtaken the smartphones market by storm. Based on the Apple’s own mobile operating system, this product combined the Apple’s already successful MP3 Player IPod with the added utility of mobile phone and other applications. The IPhone therefore was the result of the vision to combine music and mobile communication on the go while allowing consumers to check their emails, surf internet and use so called apps on their Iphones. It is also important to note that Iphone 4 comes with added features such as retina display, face time as well as with iBooks where consumers can actually read the eBooks on their Iphone4. (Apple Inc, 2010). These features were absent from the earlier versions of the Iphone. Apps have also proved a really an important source of not only improving the productivity but also created fun and excitement for the users also. (Sintumuang, 2011) Like its predecessor, Iphone was targeted as the young and middle age individuals who were looking for some added functionalities in the phone. Apple therefore has followed the segmentation strategy based on people rather than on markets. (Asay, 2010) Iphone 4 comes with the face time utility allowing users to make video calls besides enjoying high speed internet. Consumer trends therefore suggest that the customers are willing to pay the premium price for the product given the brand name and product quality of the phone. It is also important to note that Apple faced a rather tricky situation at the beginning of the launch of Iphone due to some technical issues which somewhat distracted the customers. However, the situation was overcome and the new models are now being sold with further technical refinements. A closer look at the marketing mix situation of the product would suggest that Iphone4 is priced at premium and is sold in the range of ?500 to ?6201 for two different models according to the storage capacity. Pricing of the product therefore suggest that Apple is charging premium for the quality and breadth of services it provides through its allied service iTunes. Product is mostly distributed through Apple’s own stores or through different carriers in the city. Almost all mobile phone carriers in the country are offering bundled services along with Iphone 4 however; these services are not particularly tied with Apple. In America, Apple has launched Iphone and Iphone 4 with the collaboration of carriers such as Verizon however, in UK; it is not sold along with any carrier and any carrier can actually sell the phone. The advertising as well as other elements of marketing are being done by Apple through different electronic, print and other media. The major focus is on highlighting the new aspects of Iphone 4 including its face time utility. The overall approach towards promotional activities therefore indicates that the Apple is keen on providing information about the new features of the phone to its target market. The competitive advantage of Apple lies in its ability to offer high quality products however, what truly distinguishes Apple from others is its ability to offer a complete user experience to the customers. The combined ability to offer high quality products along with allied services effortlessly and efficiently allowed Apple to build its competitive advantage. It is selling Iphone and has also tied it with it iTunes services which not only allow the users to upload their own data on the device but through iTunes services, users can actually purchase music, videos and apps thus allowing users the ease and efficiency with which they can obtain stuff of their choice. Another important aspect of the resources and capabilities of Apple lies in its CEO and most of the success of Apple revolves around Steve Jobs as the man behind all the change and turnaround at Apple. Another important resource and capability of Apple is its retail stores which are spread all over the country offering its products directly to the customers. (Jackson, 2011) On technical grounds, Apple has excellent software development team which has allowed it to develop one of the best mobile operating system in the world. The operating system which runs on the Apple Iphone 4 is exclusive and can only run on the devices built by Apple itself. (Edwards, 2010). This combination of tailored hardware and software along with excellent industrial design and development capabilities allow Apple to dominate the market where others potentially failed to make any success till now. External Analysis Competitive Situation In order to understand the competitive situation faced by the Iphone 4 it is important to divide this in hardware and software components. The major competitors of Apple in Iphone 4 market include Samsung, Google, HTC, Nokia, Sony Ericson as well as Motorola. (McDermott, 2011). It is however, important to note none of the competitors have been successfully able to challenge Iphone4 because of their inability to offer bundled services. They may be offering compatible hardware however, most of them are actually lacking in offering a better operating system which is based on open ended software. Google’s operating system Android is however, making lot of inroads into the market and more and more manufacturers are actually using Android and Microsoft’s Windows 7 operating system in order to take advantage of the better and more integrated operating systems. Apple therefore can face significant challenge in this regard because its operating system cannot be run on other devices except manufactured by Apple itself. Macro Environment London is one of the largest and busiest cities in the world and is also considered as the financial hub of the world. Due to the large economic activity and social diversity of the city provide Iphone 4 a perfect macro environment to thrive on. It is also important to note that UK as a country is passing through tough economic conditions and therefore if economic activity does not pick up in future, Iphone 4’s overall demand may reduce due to its premium price which may make it simply unaffordable to many users. SWOT Analysis Strengths 1. Excellent Industrial design and development capabilities. 2. Large network of retail stores and other strategic partners 3. CEO of Apple is also one of the strengths of the firm. (Deutschman, 2000) 4. Excellent and robust operating system offering ease with which it can be used. 5. Selling of bundled services through iTunes thus offering a complete user experience. Weaknesses 1. Highly priced therefore making it difficult for increasing number of consumers to buy the phone on standalone basis. 2. Few retail stores in London thus limiting the choices available for the consumers to purchase the phone. 3. In order to optimize the use of phone, users often have to purchase music, videos and apps from iTunes thus increasing the overall costs for them. Opportunities 1. Opportunity to offer lighter versions of the Phone with smaller storage capacity in order to allow users with low affordability to buy the phone. Threats 1 Google Android run phones are becoming common and statistics show that more and more manufacturers are adapting this operating system to beat Iphone. (Raphel, 2010) 2 Cheaper phones are coming in the market which utilizes other systems such as Android and Windows 7 thus making it more affordable for the consumers to enjoy almost same experience at relatively lower price. Strategic Actions Market Penetration In order to successfully build the market for Iphone 4 it is important that Apple must reduce it prices in order to further penetrate into the market. Market penetration therefore seems to be one of the strategies Apple could undertake in order to ensure that it remains well ahead of the competition. Market penetration strategy will be more suitable in this situation due to the fact that the market is already developed for this product and a price reduction will therefore allow Apple to remain on top despite the fact that the new and cheaper products are coming in the market. Further, Apple may also look into the opportunity of reducing the prices on its iTunes store so that customers can download videos and music at relatively cheaper prices. Product variants Till now Apple has experimented with different versions of the Phone by altering their technical specifications in terms of light weight, better signal reception, face time as well as the more storage. Due to this, the phone has also been priced at premium and the 64 GB version of the phone is selling over ?600. However, like Apple did with its Ipod product, it can also bring in more variation in the Iphone 4 in order to make it more affordable and fun to use for the consumers. Storage capacity can be reduced in order to make the phone cheaper to allow new variants to penetrate the market. Conclusion Iphone 4 is one of the leading smartphones in the world however, due to the constant inflow of new products is posing significant challenges. Iphone 4 technology is based upon the superior software and hardware design and is sold by Apple through its retail stores and other partners. In order to successfully keep its top position in the market, it is important that market penetration strategies should be adapted by Apple. Bibliography 1 Apple Inc. (2010). Apple Iphone 4. Retrieved March 07, 2011, from Apple: http://www.apple.com/iphone/ 2 Asay, M. (2010, August 26). Apple Doesn't Target Markets. It Targets People. Retrieved March 7, 2011, from Gigaom: http://gigaom.com/2010/08/26/apple-doesnt-target-markets-it-targets-people/ 3 Deutschman, A. (2000, Oct 11). The once and future Steve Jobs. Retrieved March 2011, 2011, from Salon.com: http://www.salon.com/technology/books/2000/10/11/jobs_excerpt/index2.html 4 Edwards, C. (2010). The killer iPhone. How Apple designed its new model to be sweet to customers an vicious to rivals. Strategic Direction , 26 (11), 3-6. 5 Jackson, S. E. (2011). Making strategies stick. Journal of Business Strategy , 32 (1), 5-7. 6 McDermott, B. (2011, Feb 26). Apple’s iPhone 4 loses ground on HTC and Samsung smartphones. Retrieved March 07, 2011, from Beehivecity: http://www.beehivecity.com/hightech/apple-iphone-loses-ground-on-htc-smartphones-364375/ 7 Raphel, J. (2010, September 03). Android steals more market share from Apple. Retrieved March 07, 2011, from ComputerWorld: http://blogs.computerworld.com/16883/android_apple_market_share 8 Sintumuang, K. (2011, March 5). Unlock the iPhone's Magical Time-Killing Abilities . Retrieved March 7, 2011, from The Wall Street Journal: http://online.wsj.com/article/SB10001424052748704615504576172553201712100.html?KEYWORDS=Iphone Read More