Team Members

Apeksha Maniar - 206 Tulsi Gajjar 246 Vaishali Gusani 248 Vineet Khatri 251 Vipul Raval 252 Vishal Thakkar 253 Shakti Mistry - 256

Differentiation
Creating value through uniqueness Customers must be willing to: Pay more for the differentiators products Buy more from the differentiator (at same or similar price)

Types of Differentiation
Tangible Differentiation Intangible Differentiation

Tangible Differentiation
Components of tangible differentiation Design Packaging Style Quality

Intangible Differentiation
Components of intangible differentiation Brand loyalty Image Company reputation Customer Preferences

Sources of Differentiation
Differences inquality Differences in functional features or design Buyers preferences Salespromotionactivities of sellers Differences in availability (e.g. timing and location)

Cost of Differentiation
High Cost of R&D Increased advertising spend to promote the product Cost of hiring highly skilled staff Use of more expensive material to improve the quality of the product, etc.

Increased expenditure on training

HISTORY
Formed in 1976 Founders: Steve Wozniak Steve Jobs 1976 - Apple I 1977 - Apple II 1978 - Apple III (Failure) 1985 Macintosh (Failure)

HISTORY

Steve Jobs resigned in Dec, 1985. Job formed new company NeXT Job re-united Apple in Feb, 1997 1997 Introduced MAC & Operating System

7S model

Shared Values

Think Differently Aggressiveness/Achievement Innovation/Vision Quality/Excellence

Shared Values

Positive Social Contribution

Shared Values
Empathy for Customers/Users

Structure

Structure

Structure

System

Integration mechanisms and control systems Increases intra-functional coordination and communication Helps in problem-solving and other strategic issues Reach both first time buyers and Power users

Style
Decision Maker Charismatic leader Strongly believes in quality and excellence Convincing Spends most of the time in product development Perfectionist
Our primary goal here is to make the world's best PCs not to be the biggest or the richest. Leave your neckties, bring your ideas

Staff
49500 Employees Smart & Intelligent Creative- Think differently Open for challenges- flexibility to adapt to fastmoving situations Passionate about what they do

Skills
Managerial Skills Engineering Skills Specialized engineering Industrial design Quality assurance Software development Battery Technology CPU Software Engineering Display Engineering Media Engineering Multi-Touch Engineering

Strategy

Strategy
Product Differentiation
Premium Quality Exceptional Design Personalized Service Organizational reputation and brand name

Blue Ocean Strategy

Create Uncontested market space Create and capture new demand Make the competition irrelevant Break the value-cost trade-off Align the whole system of a companys activities in pursuit of differentiation and low cost

Apple Strategic Group

Apple Products

Product Life Cycle

Apple s Growth Trend

Financial period FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 Net sales (Mil USD) 7,081 5,941 6,134 7,983 5,363 5,247 6,207 8,279 13,931 19,315 24,578 37,491 42,905 65,225 Net profits (Mil USD) -1,045 309 601 786 -25 65 57 266 1,328 1,989 3,495 6,119 8,235 14,013 Revenue growth -28% -16% 3% 30% -33% -2% 18% 33% 68% 39% 27% 53% 14% 52% Return on net sales -15% 5% 10% 10% 0% 1% 1% 3% 10% 10% 14% 16% 19% 21%

Apple Vs . Competitors ( F . Y . 2010 )

Net Sales

Margin

Advantages of Differentiation
Strong Brand Loyalty creates barrier to entry as switching costs are considerably high Constant innovation resulting into Frontend & Backend Integration Eco-friendly

Disadvantages of Differentiation
Competitors being able to imitate the products Low Cost competitor such as Dell and HP/Compaq gaining more market share Over Emphasize on Quality by Steve Jobs

Strategy

Focus Strategy
Providing a product or service that caters to a particular segment of the market Firms can focus on differentiation or low cost Serving the needs of the chosen market segment better than a broad range competitor Risks: changes in preferences of the narrow segment or attack by a broad cost leader or differentiator

Focus Strategy @ Apple

Niche Market Creative users Media Companies Youth Tech Savvy People

The Future of Apple