Nicoleta Eftimiu is a professional with over 20 years of experience, during which she worked directly or indirectly for Coca-Cola. This position enabled her to gain knowledge on the distribution and direct marketing side.
Public Domain Apple has achieved success as one of the most valuable companies in the world. This Five Forces analysis gives insights about the external factors influencing the firm.
Established inApple has been through low times. However, under the leadership of Steve Jobs, the company Porter strategy of samsung succeeded to become an industry leader.
Based on this Five Forces analysis, Apple continues to address competition and the bargaining power of buyers, which are among the most significant external factors impacting the firm.
Also, this Five Forces analysis indicates that Apple must focus its efforts on these two external factors to keep its leadership in the industry. Competitive rivalry or competition strong force Bargaining power of buyers or customers strong force Bargaining power of suppliers weak force Threat of substitutes or substitution weak force Threat of new entrants or new entry moderate force Considering these five forces, Apple must focus its attention on competitive rivalry and the bargaining power of buyers.
The firm effectively addresses the five forces in its external environment, although much of its effort is to strengthen its position against competitors and to keep attracting customers to Apple products. Competitive Rivalry or Competition with Apple Strong Force Apple faces the strong force of competitive rivalry or competition.
High aggressiveness of firms strong force Low switching cost strong force Companies like BlackBerry, Samsung, LG, and others aggressively compete with Apple. Such aggressiveness is observable in rapid innovation, aggressive advertising, and imitation.
On the other hand, switching cost is low, which means that it is easy for customers to switch from Apple to other brands, thereby making competition even tougher. Low switching cost strong force Small size of individual buyers weak force It is easy for customers to change brands, thereby making them powerful in compelling companies like Apple to ensure customer satisfaction.
This condition makes customers weak at the individual level. However, because it is easy to shift from Apple to other brands, buyers still exert a strong force. Thus, this part of the Five Forces analysis shows that Apple must include the bargaining power of buyers or customers as one of the most significant variables in developing strategies.
High number of suppliers weak force High overall supply weak force Even though Apple has less than suppliers of components for its products, the company has more options because there are many suppliers around the world.
This condition makes individual suppliers weak in imposing their demands on firms like Apple. In relation, there is a high level of supply for most components of Apple products. Thus, this part of the Five Forces analysis shows that Apple does not need to prioritize the bargaining power of suppliers in developing strategies for innovation and industry leadership.
High availability of substitutes moderate force Low performance of substitutes weak force Substitutes to Apple products are readily available in the market. For example, people can easily use digital cameras instead of the iPhone to take pictures.
They can also use landline telephones to make calls. However, these substitutes have low performance because they have limited features.
Many customers would rather use Apple products because of their advanced features. This part of the Five Forces analysis shows that Apple does not need to prioritize the threat of substitution in business processes like marketing and product design and development.
|Quick Contacts||Strategy Implementation - Meaning and Steps in Implementing a Strategy Strategy Implementation - Meaning and Steps in Implementing a Strategy Strategy implementation is the translation of chosen strategy into organizational action so as to achieve strategic goals and objectives.|
|Overview: Apple Inc.’s Five Forces Analysis||Strengths We are able to respond very quickly as we have no red tape, and no need for higher management approval.|
High capital requirements weak force High cost of brand development weak force Capacity of potential new entrants strong force Establishing a business to compete against firms like Apple requires high capitalization.
Also, it is considerable costly to develop a strong brand to compete against large firms like Apple. These factors make new entrants weak. However, there are large firms with the financial capacity to enter the market and impact Apple.
Google has already done so through products like Nexus smartphones. Samsung also used to be a new entrant.
These examples show that there are large companies that have potential to directly compete against Apple.S.N. Case Title: 1: M-PESA: Kenya's Experiment with Branchless Banking. 2: TOMS: One for One Giving Model: 3: Cadbury's Relaunch of Caramel and Wispa: Reposing faith in Standalone brands?
Strategy implementation is defined as the manner in which an organization should develop and utilize organizational structure, control systems, and culture to follow strategies that lead to competitive advantage and a better performance.
Featured. McKinsey Global Institute Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. By Don Shapiro, President, First Concepts Consultants, Inc. For too long, structure has been viewed as something separate from strategy.
Structure is how the entire organization operates, not just its organization chart. Apple’s Five Forces analysis (Porter’s model) of external factors in the firm’s industry environment points to competitive rivalry or intensity of competition, and the bargaining power of buyers or customers as the most significant factors that should be included in strategic formulation to ensure the continued success of Apple products.
Auto Suggestions are available once you type at least 3 letters. Use up arrow (for mozilla firefox browser alt+up arrow) and down arrow (for mozilla firefox browser alt+down arrow) to review and enter to select.