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5 Forces Apple Analysis

This document discusses Porter's Five Forces model and its application to analyzing Apple Inc.'s industry. It identifies that Apple faces intense competition from other major technology brands like Google, Amazon, Microsoft, Lenovo, HP, and Samsung. These competitors aggressively compete for market share in areas like smartphones, tablets, laptops, and PCs. The analysis finds that competitive rivalry is a major force for Apple due to high aggressiveness among firms, low product differentiation, and low switching costs for customers. Managing this competitive pressure is a key strategic consideration for Apple.

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Joshua Egeron
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139 views

5 Forces Apple Analysis

This document discusses Porter's Five Forces model and its application to analyzing Apple Inc.'s industry. It identifies that Apple faces intense competition from other major technology brands like Google, Amazon, Microsoft, Lenovo, HP, and Samsung. These competitors aggressively compete for market share in areas like smartphones, tablets, laptops, and PCs. The analysis finds that competitive rivalry is a major force for Apple due to high aggressiveness among firms, low product differentiation, and low switching costs for customers. Managing this competitive pressure is a key strategic consideration for Apple.

Uploaded by

Joshua Egeron
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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APPLE: Chapter 3 Five Forces Analysis

In this chapter, we are now focusing on Porter’s Five Forces model which analyzes five
important factors that are part of every industry and market. Since 1980, when it is first
developed by Michael Porter, the model has come to be widely used to analyze the profitability
and attractiveness of industries. As what we, the researchers, have learned, the said
competitive forces being analyzed by the model can be affected or exploited to increase
profitability. Managers can form strategies based on the strength of these forces to improve
the profitability of their businesses. By understanding more about the environment where the
business is, it gives the company the advantage of being able to navigate its way towards
sustainability and success.
3.1 Industrial Rivalry The level of competition between the top brands in the
technological industry is extremely high and active. Up to this date, more and more brands are
competing to have a sustainable market share in the industry. Some of Apple’s competitors are
as follows: Google, Amazon, Microsoft, Lenovo, HP, Samsung, etc. All those above-mentioned
brands, and also those brands that are competing with Apple but were not mentioned, are
engaged in an intense competition wherein one’s loss can be a benefit to another. Undeniably,
Apple Inc. is one of the most popular companies around the world. Products by Apple have
been associated with appealing and innovative designs and approachable user interfaces for
millions of users for over the years. Moreover, competition is a key factor affecting Apple’s
performance and profits. It is one of the reasons why Apple keeps motivated and at the same
time challenged to improve and innovate as the technology field changes and grows rapidly
from time to time. Amazon’s Kindle is a threat to its iPad while Google and Samsung’s
smartphones are to its iPhone. Also, HP and Lenovo compete with its laptops and PCs.
Apple faces a strong force of competitive rivalry. It is identified in this component of the
Five Forces Analysis that competitors have an intense influence on each other. Upon studying
Apple’s case, the said influence is based on the following external factors: 1. High
aggressiveness of firms (strong force) 2. Low differentiation of products (strong force) 3. Low
switching cost (strong force) The above-mentioned external factors form part of a combination
which specifically leads to tough rivalry that is among the most significant considerations in the
strategic management of the company.

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