Question

• According to the Boston Consulting Group Matrix, how would you classify Apple’s current product portfolio? • What opportunities exist for Apple to grow? (Consider this question in terms of the Product-Market Expansion grid.) • What macro- and micro-environmental forces will affect Apple’s future strategy? • What, if any, research does Apple need to do in order to form a plan for success? • How would you characterize Apple’s industry in terms of Porter’s Five Forces?

Answer 1

a) Apple’s current portfolio can be considered as Cash Cows in the BCG matrix. This is because the return on asset of Apple is quite high. Apple has been a market leader of smartphones for quite sometime. This has facilitated the high ROA.

b) SWOT Analysis of Apple Inc.

Strengths:

• The ability to design, prototype and develop unique and cutting edge innovative products
• Apple has been in a leadership position in the technology industry for many years and has a loyal base of customers
• Apple enjoys a very high brand equity in the industry
• The brand image of the company is quite strong and is one of the most trusted brands for product quality
• Apple has become synonymous of a lavish lifestyle and sleekness

Weaknesses:

• The relative high price of Apple’s products keep it out of reach from the mass market
• The distribution network and post sales service of Apple products is quite narrow globally
• Many of the Apple products are incompatible with the software and accessories present in the market
• The product portfolio of Apple is quite limited when compared with its competitors
• The sales of Apple products are limited to high-end market making its coverage quite limited

Opportunities:

• Technological advancement is the most capitalizing opportunity for Apple’s innovative business strategy
• Apple is entering the automobile market with Apple cars, which will be launched in the year 2020
• The growth opportunities in developing countries like India is immense for a company like Apple
• The markets of Apple TV and Iwatch is yet to be explored
• Collaboration with various complementary brands can increase market presence of Apple

Threats:

• Product Imitation is one of biggest threat to Apple products
• Emerging competition from various companies is a great threat to sales of Apple products
• Rising labor cost may increase manufacturing cost of Apple products
• The market inflation may decrease the purchasing capacity of the consumers, which may adversely affect the market for Apple products
• Market penetration of various companies is increasing in the smartphone sector