Apple's Strategic Assessment Essay

3266 Words Apr 22nd, 2008 14 Pages
Apple Strategic Assessment

Strategic Assessment
 Economic features (Computer Market) o Size: $800 billion worldwide

o The US market is controlled by five main companies, Dell, HP, Gateway, IBM and Apple. These companies control 64% of the US market and 40% of the international market. Apple only controls 2% of the international market. The markets have experience a substantial growth in recent years but are predicted to slow down to 8% unit sales growth from 2006 to 2009 in the US and European markets while continuing to grow in Asia. The PC industry has its 10th consecutive quarter of double digit growth (2005)

o In 2005 Apple had approximately $13.9 billion in sales with about $6 billion of that coming from computers and
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o A 2005 survey by PC Magazine rated iPods significantly higher than the competing brands of MP3 players based on reliability, ease of use, sound quality, and overall quality. Apples simplicity makes the iPod more attractive than other brands. Creative Labs Dell, iRiver, RCA, Rio, SanDisk and Sony all offer similar products to the iPod that range in all prices and features. No brand really stands out as the low cost provider in the MP3 market. There isn’t a whole lot of differentiation between the products.

o Creative Labs products allowed users to slow down songs while not changing the pitch, record music straight from the radio, and had FM settings.

o Dell also offers recording capabilities. Dell has a price advantage and flexibility of where consumers could buy their music. Dell is the cheapest of all the products.
Rio is no longer even in the market.

o Analysis: MP3 players are a growing economic market that will continue to expand based on the rate of technological advancements. Because of the decline in the economy there might be a set back in sales of MP3 players but will probably be offset by the rate of innovation.

o It has been projected that Apples best opportunity for growth is based on the halo effect that is coming from the popularity of the iPod. The success of the iPod is creating a brand loyalty that is causing consumers to look to Apple for their next computer purchase.

 External

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