Apple in 2010

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By 2004 the firm held a 70% market share in the digital music industry. The success of the iPod helped build the brand value of the company. The popularity of the brand helped the company revive its computer business. In 2005 the firm held a market share of 4% in the computer business which was a tremendous feat considering the firm had less than a one percent share a few years earlier. The transformation of Apple helped the firm visualize opportunities in other markets such as the cellular industry. In 2007 Apple released a product that changed the cellular industry. The iPhone was the first smartphone. Steve Job’s leadership was critical to the success of the company. He pushed his engineers and staff to provide innovative ideas. He also had the foresight of getting rid of unprofitable business segments and divisions. The firm had great leadership which motivated the employees to achieve their potential. The COO of the company, Tim Cook, was also instrumental in the success of the company. Apple Computers adapted well to market changes. The firm realized that the success of the company relied on the ability of the firm to look beyond the computer sector for sales. During the 21st century the generic strategy of the company evolved and the firm started utilizing a diversification strategy. Diversification growth makes sense when good opportunities can be found outside the present businesses (Kotler, 2003, pg. 101). The three main business segments Apple penetrated are the computer industry, cellular products, and music media players. The computer industry in 2009 was consolidated with five vendors accounting for 78.5% of the U.S. shipments and 60.3% of the sales worldwide (Marino amp. Gamble, 2010). The recession of 2008-2009 slowed down the growth in sales and negatively impacted the prices of computers. By the second quarter of 2010 industry sales rose once again experiencing a growth of over 20%. A tendency among computer users was replacing desktop computers with laptops and notebooks. As of 2010 Apple despite the fact that a growing number of its sales came from non-computer products considered the computer division its core business. The Mac product line differentiated itself from the competition due its superb quality, superior operating system and graphic interface. The market share of the company jumped from 4% in 2005 to 8% by 2009. The firm benefited from a halo effect of users of iPod and iPhone wanting a computer product from the same brand. The computer product offering of the company included the Mac Pro, iMac, and Mac Mini. The notebook offering of Apple was composed of the MacBook Pro, MacBook, and the MacBook Air. The most recent innovation to the Apple line of computer products was the MacBook Air. This notebook targeted customers that seek durability and portability. The computer was designed to have a height of 0.76 inches when closed and it weighted only three pounds. All Apple desktop and notebook products were priced at a premium. This strategy helped boost the profitability of the company. Due to the fact that Apple no longer depended solely on computer sales the strategy worked better than in the past. In order to boost the demand for its computer products the company implemented a 10% or more discount on all its computer products in June of 2009. The law of supply and demand states that a decrease in price will