Apple Resources and Capabilities
An Analysis of Apple's Resources and Capabilities
Apple is a leading technology brand founded by Steve Jobs and Steve Wozniak. The company is famous around the globe for its matchless technology and products like Mac and iPhone. However, apart from its highly attractive and popular products, Apple is best known for its great marketing. The company brought several market leading products like the Mac Operating system, iPhone, iTunes, iPad and several more. With time, it has also added many other products and services to its product mix. Rivalled mainly by Microsoft, Apple enjoys very high brand equity in the global markets. Apple’s edge comes from the competitive advantage and the leadership position it has built in the technology industry. iPhone apart from being a highly attractive smartphone, is also loaded with innovative technology and apps. It is the leading source of revenue for the brand. Apple is known for technological innovation but simultaneously marketing and supply chain management as well as a keen focus on customer experience have also helped it strengthen its competitive position in the market.
Have a look at the various resources and capabilities that have helped Apple build and sustain its competitive edge.
Brand equity :-
Brand equity is a significant strength for a brand that has achieved a leadership position. Apart from gaining competitive edge, it helps a company sustain its market leading position and customer base. Brand equity comes from trust and perfectly crafted customer experiences. Apple has always remained a leader in terms of customer focus and an example for others to imitate. The company is known for its obsession with quality and strong customer centricity. Strong customer connection and high level customer engagement have helped the brand build strong equity. The result is high level popularity and sales as well as easy brand recall. This can be highly beneficial for a brand and while on the one hand it makes your image stronger in the market, on the other it also has major advantages in terms of marketing. Apple’s distinct identity and image are a source of competitive advantage. It has built the image of a premium brand with a strong focus on innovation and customer convenience.
Product Quality :-
Product quality can be the driver of demand and popularity. Apple’s reputation in terms of product quality has remained unchallenged. The company brought several mind blowing products starting from Mac computer to iPhone, iTunes, and several more products and services. However, if its products are market leading products, then it is because of the heavy focus on quality and innovation. Apple has always challenged the established norms to bring breakthrough products and services. It is why the demand and popularity of Apple products is high despite the premium price tags.
Research and innovation:-
As a technology brand, Apple places heavy focus upon research and innovation. The level of competition in the tech industry is very high. Among the leading competitors of Apple are HP, Lenovo and Dell in computing, Samsung in smartphones and Microsoft and Alphabet in operating systems. All the rivals of Apple also invest heavily in R&D. Since its foundation, Apple has a strong reputation as an innovative company. It has excelled in the area of creating out of the box products and services. The company invests a large sum each year in Research and innovation. The company invested around 14.24 Billion dollars in research and innovation in 2018. In the first quarter of 2019 alone, it invested around 3.9 Billion dollars in R&D.
Global presence of Apple and its global popularity is also a key advantage that Apple has sustained well. The company operates its business mainly on a geographical basis. Its business is divided into the following geographic segments - Americas, Europe, Greater China, Japan and Rest of Asia Pacific. Americas include both North and South America. Apart from the company owned stores, Apple also sells through online channels and authorized resellers in markets around the globe. Global presence of the brand is a key competitive advantage that helps the brand achieve higher sales and revenue.
Marketing is also a key source of competitive advantage for a brand that apart from driving sales also helps the brand achieve a distinct and differentiated identity. Apple is known as a leading marketer. For years, its unique marketing strategy has helped drive sales and engage customers better. The brand has built a distinct image for itself and a great reputation as an innovative technology brand. Its excellent marketing strategy is also a key source of popularity for the brand. While technological innovation is a key reason that Apple is very popular, its marketing strategy has also helped it establish itself as a customer centric brand.
Consistent focus on innovation, quality and customer convenience has helped Apple build a large customer base and strong customer loyalty. The company has a large customer base and its customers are very loyal customers. Apple has also built an ecosystem of related products which has helped it sustain its customer loyalty. Most Apple customers buy several products from Apple like smartphones, laptops and accessories.
Apple has managed a large and global supply chain network which ensures the availability of good quality raw material. Majority of its supply chain and assembly functions are located outside US. A large number of apple suppliers are located in Asia. However, the company has managed its supplier network very well. The result is continuous availability of good quality raw material which is key to the production of Apple’s products.
|Brand equity||Yes||Yes||yes||Yes||Competitive advantage|
|Global Presence||Yes||No||No||Yes||Temporary advantage|
|Customer loyalty||Yes||Yes||No||Yes||Temporary advantage|
|Supply chain||Yes||Yes||No||Yes||Temporary advantage|
|Premium Product quality||Yes||yes||Yes||Yes||Competitive advantage|
|Research & Innovation||Yes||Yes||Yes||Yes||Competitive Advantage|
Apple Annual Report 2018.