Question

It is a strategic management.

Question: Discuss the business-level and corporate-level strategies of Apple, as discussed in the articles below. Why is Apple pursuing these strategies? Be sure to discuss competitive pressures from Sony as it pursues its strategy. Compel your response with data from the articles.

Article 1:

High-end AirPods and over-ear headphones coming next year

Foxconn to build AirPods; Inventec may lose some HomePod work

Apple Inc. is about to pump up the volume on its audio-device strategy, planning higher-end AirPods, a new HomePod and studio-quality over-ear headphones for as early as next year, according to people familiar with the matter.

The Cupertino, California-based company is working on new AirPods with noise-cancellation and water resistance, the people said. Apple is trying to increase the range that AirPods can work away from an iPhone or iPad, one of the people said. You won’t be swimming in them though: The water resistance is mainly to protect against rain and perspiration, the people said.

Slated for 2019, the earbuds will likely cost more than the existing $159 pair, and that could push Apple to segment the product line like it does with iPhones, one of the people said. Apple is also working on a wireless charging case that’s compatible with the upcoming AirPower charger.

The company has also internally discussed adding biometric sensors to future AirPods, like a heart-rate monitor, to expand its health-related hardware offerings beyond the Apple Watch, another person said. The current AirPods will be refreshed later this year with a new chip and support for hands-free Siri activation, Bloomberg News reported.

There are over-ear headphones coming from Apple, too. Those will compete with pricey models from Bose Corp. and Sennheiser. They will use Apple branding and be a higher-end alternative to the company’s Beats line. Apple originally intended to introduce the headphones by the end of 2018, but has faced development challenges, and is now targeting a launch as early as next year, the people said. They asked not to be identified talking about unreleased products. An Apple spokeswoman declined to comment.

Shares of noise-cancellation component maker Cirrus Logic Inc. rose as much as 10 percent after Susquehanna analyst Christopher Rolland wrote that the company would be working with Apple on the new AirPods.

The consumer-electronics giant uses unique accessories like the AirPods to round out its hardware and software ecosystem. Accessories have become an important revenue source in recent years, helping Apple’s Other Products unit generate sales of $12.9 billion in the 2017 fiscal year. That’s cushioned a slowdown in iPhone unit growth.

Apple's Other Sales Boom

Other Products category has become an increasingly important selling point for Apple devices

Note: Other Products include AirPods, Apple TV, Apple Watch, HomePod, Beats headphones, accessories.

The upcoming audio push builds on Apple’s earlier success in the field. The iPod and iTunes digital music store helped revive the industry and began a transformation that turned the company from a computer maker into a mobile-device giant.

In 2012, Apple declared itself one of the largest shippers of audio speakers because of the earbuds that come bundled with its devices and the built-in speakers in iPhones, Macs and iPads. Two years later, Apple bought headphone maker and streaming-music company Beats for $3 billion, its largest acquisition. An in-house audio-product team is run by Gary Geaves, formerly an engineer from B&W Group Ltd., a maker of speaker systems and headphones.

Apple is shaking up its supply chain in preparation for the latest audio products, expanding a partnership with iPhone manufacturer Foxconn Technology Group and decreasing its reliance on smaller hardware maker Inventec Corp., the people said. Apple plans to ramp up AirPods production by working with Foxconn, people familiar with the arrangement said. So far, it has mostly worked with Inventec, but builds about 30 percent of the units with Luxshare Precision Industry Co. When the earbuds first came out in 2016, they were delayed, and there was limited supply after the product finally went on sale. A Foxconn press official declined to comment.

Apple’s latest music-focused device, the HomePod, was also delayed, and has seen sluggish sales so far -- although reviewers praised the sound quality. It was originally built with Inventec, but Apple has since expanded production to Foxconn. Apple is working on a new version of the HomePod for as early as next year, and it could switch production away from Inventec for the latest model, according to people familiar with the relationship. Inventec executives met with Apple executives in California in recent weeks to discuss future HomePod orders, but a final decision on working with Inventec on the new model hasn’t been made, the people said. An Inventec spokeswoman said the company "will try its best to secure new orders."

For the over-ear headphones, Apple has discussed working with Tymphany, a Primax Electronics Ltd. subsidiary that makes consumer and professional audio systems, according to a person familiar with the situation. Production hasn’t started, and the deal isn’t finalized.

Article 2 - Sony:

Pioneer of Walkman targets premium market dominated by Bose and Beats

TOKYO -- When Ichiro Takagi took over Sony Corp.'s audio business seven years ago, he found the staff took pride in being the global No. 1 in headphones, in terms of units sold. But he was appalled at how many were $10 headphones sold for minimal profit at grocery stores. "What's the point of that? Where's our brand image?" Mr. Takagi recalls telling employees. Fast forward to this fall and the international electronics show in Berlin, where Mr. Takagi was showing off the latest version of his flagship product, a $350 pair of noise-canceling wireless headphones.

The premium-price headphone market has been largely dominated by Bose, the industry pioneer popular with frequent fliers, and Beats, the fashion-savvy brand acquired by Apple Inc. for $3 billion in 2014. All share the challenge of wooing listeners who already get free earbuds with their smartphones.

Sony said in May it has 11% of the headphone market in terms of revenue, the third-largest slice. It didn't name the top two companies.

The audio business -- where Sony has been a player since the 1950s -- is a prime example of how it got back to profitability in recent years, even in a traditional hardware business that once looked like a lost cause. For the year that ended in March, sales for the audio unit rose for the first time in 20 years after having fallen some 80% from the peak.

More important for Chief Executive Kenichiro Yoshida, the home-electronics division, including audio and televisions (another former money loser), posted operating profit of nearly $800 million for the year, helping Sony achieve record overall profit. Mr. Yoshida is hoping roughly to match that record in the current fiscal year: Quarterly earnings coming Tuesday will give a progress report. The rise of Spotify Technology SA and other music services has been good for headphone makers, increasing the time consumers spend listening on the go. Streaming companies such as Spotify and France-based Deezer offer high-resolution services that have expanded the market for higher-quality headphones costing hundreds or even thousands of dollars. Recent product releases by Sony include a $280 pair of earphones; an $8,500 portable music player targeted at audiophiles goes on sale in December, with a gold-plated volume controller and a battery system designed to reduce noise.

In the first generation of portable MP3 music players, "the quality of the music sources was poor," Sony audio executive Yoshinori Matsumoto said. "We couldn't push high-end listening devices because they would highlight the coarseness." Now, better technology has "made high-quality music more accessible both to customers and creators," he said.

Audio has paralleled Sony's highs and lows through its 72-year history. The Walkman in 1979 set off a revolution in portable electronic devices, with Sony in the lead. But in the 2000s, Sony let Apple and the iPod seize the dominant position. By 2011, the Tokyo company was nearly giving up on its old hardware products. "The attitude of management at that time was like, 'If you're so-so, that's fine,' " Mr. Takagi, the audio-unit chief, said. That changed under then Chief Executive Kazuo Hirai, who took over in 2012, and Mr. Yoshida, who was chief financial officer under Mr. Hirai and became CEO this year. They pushed the audio team to drop cheap products and focus on a few high-end models.Mr. Takagi says the new management scrapped an organizational chart that had separate groups of engineers focusing on subcategories like car audio. "I told them to look around the whole industry to come up with products that consumers are willing to pay extra for," he said.

Sony says the $350 headphones can detect the owner's facial shape, hairstyle and presence of glasses, as well as pressure changes in an airplane, all to optimize the noise-canceling feature. "Our latest model is distinctly the best in terms of noise-canceling technology," says Mr. Takagi, who is in the habit of visiting electronics stores to eavesdrop on what customers are saying to salespeople. "It's obvious if you ask your ears."

Another Sony rival, especially for younger customers, is Beats. Mr. Matsumoto says the competition has led Sony to stress fashion as well as sound quality. "In China, headphones have become part of the outfit for young people, and they have to have a style that people want to wear all the time, even when they are not listening," he said.

Mr. Takagi said there is more innovation to come, such as headsets that stream music from the internet on their own without having to be hooked up to a smartphone. "Audio will remain a profitable business so long as we keep listening to music," Mr. Takagi said. "If we remain as a strong and respected player in the industry, then the whole company will be too because audio is the origin of Sony."

Answer 1

Answer 1:

After going through both the given articles I have identified Apple’s business-level and corporate-level strategies as follows:

Business-level strategies:

• Products category is one of the strategies that creates increasing selling point for Apple devices.
• Product Diversification Strategy
• Acquiring Beats for $3 billion.
• Talent acquisition is another Business level strategy of Apple. It employed Gary Geaves, who formerly was an engineer at B&W Group Ltd.
• Expanding partnership with Foxconn Technology Group.
• Decreasing reliance with smaller hardware groups.
• Producing higher-end alternative to the company’s Beats line.
• Adding more features to the products than competitors.

Corporate-level strategies:

• Apple uses its unique accessories to round out its hardware and software ecosystem.
• Developing accessories such as AirPods, Apple TV, Apple Watch, HomePod, Beats headphones gives competitive advantage to Apple.
• By limiting supply after the product finally went on sale; this stunt increases the demand and value of product.
• Selecting the best manufacturer from the industry.
• Producing only quality products creates competitive advantage for Apple.
• Targeting customers who can afford quality by paying higher rather than compromising quality for money is another corporate level strategy of Apple.

Answer 2:

Apple is pursuing these business-level and corporate-level strategies in order to attain competitive advantage and become the market leader. To higher end products and stay in top position will serve the most significant reason of any business i.e. to maximize profits.

Also these strategies will help in maintain the brand position that Apple has created in the past years.

Answer 3:

Competitive pressure from Sony has definitely a hand in driving the strategies that Apple is following at business and corporate level. Both the companies are in audio industry and have tough competition. Both are coming up with headsets. In this scenario it is important for Apple to lay emphasis on its competitive advantages.