International Business strategies of Apple Inc.

Palash Goyal -2014 MBA15

1974

The idea for Apple Computers was

BORN

1976

First Computer was

SOLD

1984

The Macintosh was

INTRODUCED

1985

was dischargedSteve Jobs

1986 1997

Apple II was introduced

Steve Job returns to apple

2001 2011

ipods 4 & 4s

And the Innovations continue…

Product portfolio

Cont..

Cont..

How Apple does INNOVATIONS…“Great ideas push the world forward. And they can come from anywhere.”

Apple relies on their employees’ diverse backgrounds and perspectives to spark innovation. They hire more inclusively, choosing partners who make diversity a priority.

In the US they hired more than 2,200 Black employees — a 50 percent increase over last year — and 2,700 Hispanic employees, a 66 percent increase. nearly 50 percent of the people they hired in 2015 were women, Black, Hispanic, or Native American.

http://www.apple.com/diversity/

• Genius ergonomics make Apple products effortless to use. 

•  Innovation lies also in Apple’s innovative business models – new synergistic ways to create, deliver, and capture value.

• For instance, the iPod and iPhone would not have

had nearly as much impact if they hadn't been matched with iTunes and the App Store respectively.

Cont..

• Apple attempts to increase market demand for its products through differentiation, which entails making its products unique and attractive.

• Apple has succeeded in creating demand for its products, giving the company power over prices through product differentiation, innovative advertising, ensured brand loyalty, and hype around the launch of new products.

Cont..

Supply chain

Source: www.supplychain247.com

IT research firm Gartner ranked Apple’s supply chain last year as the best supply chain in the world for the third time in a row.

Strength

• Brand equity.• Tag of innovation.• Consumer loyalty.•Amazing software and OS.• Design consistency.

Weakness

•High price.•Restrictions on the phone.•No Steve jobs anymore.

Opportunities

•Continued technological advancement.• Geographic expansion.

Threats

• Android – The single biggest threat to Apple Iphone is the Android operating system.•Samsung with it’s large varieties of mobile phones coming in all shapes and sizes.

SWOT Analysis

Porter’s Diamond Model

Structure of firms & rivalry

Factor conditions Demand conditions

Related & Supporting industries

Government

Chance

• Distribution Network.•Transportation.•Good communication system.

•Brand image (status) •high demand in India till 2014 , but in 2015 when iphone 6 & 6 plus were launched the demand was comparatively less, sales were 10-20% of previous year.*(2)

Source:*(1) IndiaTimes.com *(2) http://retail.economictimes.indiatimes.com *(3) http://indiatoday.intoday.in/ and economic times

•Globalized & Standardized .• Design and technology.•Apple has to compete with rivals like Samsung (tough competitor)and Micromax as iPhone only enjoys 10% market share in India.*(1)

• Redington & Ingram supply Apple's products in India.•Brightstar.

•Apple filed request with govt. to open Apple store in India.•Relaxation in FDI norms.•Relaxation in local sourcing that was 30%.(*3)

Leontiades’ Model

Global high share strategy

Global niche strategy

National high share strategy

National niche strategy

Global

National

High Low

Market share objectives

Mar

ket

scop

e

Cont..

Global Niche Strategy: Offering product mix in mass market.International Standardization.It targets upper segments, having low price sensitivity.High research & development.Unit cost reduction by foreign outsourcing & importing.Apple has 479 retail stores in 18 countries and an online store available in 39 countries.*(1)iphone 6 & 6 plus were available in 69 countries & territories.*(2)

Source: *(1)Wikipedia *(2)www.apple.com

Administrative Cultural

•Working culture in India is slightly

different , attitude regarding the work

creates differences.

•Language barrier is no longer exist for the

international companies like Apple, English

has been adopted as USB of language.

•As Apple is having its own organizational

culture based on innovation , creativity

and secrecy , the challenges arise while

matching their organizational culture with

the country’s culture.

•Biggest obstacle has been removed for

setting up fully owned stores in India for

Apple.

•Union government has relaxed mandatory

condition linked to single brand retail on

30% sourcing from India.

•This is creating possibilities to Foxconn of

setting up a manufacturing plant in India

for Apple products.

•Political hostility and the corruption are

the two terms which is generally

exaggerate by the competitors of the

organizations.

Economic Geographic

•India is having GDP of 1262.62 USD which

illustrate that Apple is having market of

those customers who can afford their

products.

•Labor cost in low, distribution and sales

are the most dominant activities of Apple

in India for that purpose the labor cost is

low.

•Availability of skilled human resources at

lower cost.

•Apple is having 0.15% of world economy

which depicts is financial capabilities itself.

•Location of India is near to assembling

location of apple like China so it provides a

geographical advantages.

•Climate differences can effect the

distribution related operations due to

diversified climate of country.

•Transportation and communication ,

these factors are supportive for the apple

due to availability of giant players in

logistics and also availability of high speed

highways connectivity.

International Product Life Cycle(IPLC) Curve

Conclusion

• Indians getting problems in downloading and there is problem in Bluetooth connectivity so this influence many buyers towards another options. So these problems should be solved.

• Apple should provide some apps free , which are freely available in android market so that they can increase their customer base.

Recommendations

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