Swot analysis:
Swot analysis is a tool used for strategic planning and management. It can be used to make competitive
strategies. Swot which stands for strengths, weaknesses, opportunities, and threats of an organization
plays an important role in making business planning. Here is the SWOT analysis of an apple.
Strength:
Strengths are related to the internal factors of an organization. Apple is the most reputable and valuable
brand with a considerable number of strengths. This section identifies the number of strengths that can be
utilized to overcome weaknesses.
Brand recognition and customer grow
Apple is the world's most valuable brand in 2023 with a brand value of US$880.4 billion, holding its top
position for the second year. (Cihan Uzunoglu, 2023). Apple uses its brand to showcase its lifestyle.
Apple has a significant amount of customer growth due to its commitment to innovative products, and upto-date features.
Innovative and high-quality product.
Apple is proficient in technology and mostly recognized for its innovation and high-quality features. The
company has introduced incredible products since its founding with numerous product lines such as Mac,
iPhone, iPad, Apple Watch, and Apple TV. Apple is well known for its meticulous research and pays close
attention to its design.
Weaknesses:
Weaknesses are internal factors that are obstacles to business growth in consideration of the
performances of other technology businesses. (citation). This section identifies the weaknesses that
Apple has yet to overcome:
High price:
Although Apple products are well known for their features and design the other thing, they are well
known for is their high prices. This makes Apple products a kind of luxury and is only affordable for the
rich class or somewhat of the middle class.
Limited Advertisement:
Another weakness of Apple is its limited advertisement at a local media level as compared to its
competitors such as Samsung, Oppo, etc. which makes Apple products harder to penetrate local markets
of China and Korea. Its marketing strategies rely on its flagship retail stores which are not flexible enough
to local situations.
Dependency on one product:
The major gross revenue of Apple comes from its iPhones or iPads. Which is its main brand recognition
factor.
Opportunity:
Opportunities are the external factor of the industrial environment which shows the potential for the
growth of Apple. Following are the main pinpoints of the analysis of those external factors:
Consistent customer growth:
Apple is a well-known brand and its value is increasing over time. Every new launch of Apple’s iPhone is
enticing and capturing more and more customers. while Apple has its loyal customer base which Apple
usually targets.
Expanding distribution
As e-commerce is expanding the company now has a chance to expand its sales directly or indirectly. By
expanding its network of distribution, the company can venture into the global market more effectively.
4. Utilize Artificial intelligence
With the rise of machine learning technologies such as deep learning and natural language processing
(NLP), Apple can now leverage powerful AI algorithms to create intelligent personal assistants that
understand users’ needs and intentions better. Not only could this tremendously improve customer
experience by providing personalized services tailored to individual user preferences, but it could also
enable Apple to develop proprietary products based on insights from user data, creating new revenue
streams while optimizing existing ones.
https://businessmodelanalyst.com/apple-swot-analysis/
use of Artificial Intelligence:
Artificial Intelligence is now a main focus globally. Various companies like Microsoft, and Google are
expanding in the AI market. While Apple has its own AI Siri it has a very good opportunity to create a
personal assistant that understands user’s needs and intentions better. In this way, Apple can get an
advantage over its competitors but also provide excellent customer services
Threat:
Threats are the external challenges that pose a challenge to a company’s financial performance. The
following are the threats that Apple faces:
Aggressive global competition:
This is an era of globalization. Because of this Apple has to face not only competition at local but also at
international level. To face this challenge, the company must integrate into new markets and focus on
innovation and effectively stimulate customer demand for new and upgraded products and services, and
successfully.
External Suppliers:
Another major threat to Apple is that its major suppliers are from Asia. Any economic or political
uncertainty may cause a serios problem and shortage of raw material or extensive cost for Apple.
PESTLE Analysis:
A PESTEL analysis is a framework or tool used by marketers to analyze and monitor the macroenvironmental (external marketing environment) factors that have an impact on an organization,
company, or industry. It examines the Political, Economic, Social, Technological, Environmental, and
Legal factors in the external environment.
Political Factor:
The Company is subject to an increasing number of federal, state, and international laws relating to the
collection, use, retention, security, and transfer of various types of personal information. In many cases,
these laws apply not only to third-party transactions but also restrict transfers of personal information
among the Company and its international subsidiaries.
Payment card data is also subject to additional requirements. Under payment card rules and obligations,
if cardholder information is potentially compromised, the Company can be liable for associated
investigatory expenses and can also incur significant fees or fines if the Company fails to follow payment
card industry data security standards.(apple nc)
https://s2.q4cdn.com/470004039/files/doc_earnings/2023/q4/filing/_10-K-Q4-2023-As-Filed.pdf
Economic factor:
The economic growth of the country where Apple operates is a major positive factor. If a country faces
any economic challenges, it can pose adverse challenges for the company. The effects of an economic
failure gone global may lead to suppliers being unable to attain the necessary pieces, this may have an
impact on the company being subject to risks of lack of supply that will impact prices.
https://repositorio.iscte-iul.pt/bitstream/10071/13973/1/MIM%20Dissertaion%20Eve%20PintoCardoso%20Final.pdf
Adverse macroeconomic conditions, including slow growth or recession, high unemployment, inflation,
tighter credit, higher interest rates, and currency fluctuations, can adversely impact consumer
confidence and spending and materially adversely affect demand for the Company’s products and
services. In addition, consumer confidence and spending can be materially adversely affected in
response to changes in fiscal and monetary policy, financial market volatility, declines in income or asset
values, and other economic factors. (apple inc)
Social factor:
With a growth in population in urban area the people are more attracted toward the innovation and
technology which increases the demand for Apple in India, Bangladesh. Consumer preference is also
changing constantly with every new launch of product in a market. The consumer is more drawn towards
a product with high quality and multiple features. the people in countries like China or Japan are less
attracted towards Apple costly product and preferred more their local product.
Technology factor:
Apple has always focus on the advancement of the technology. It is spending more and more on its
research to introduce new features on its existing product or launch new products to penetrate a new
market segment. Apple has already moved from providing product to services and now is earning a huge
amount of profit through Apple Music, Apple TV+.
Along with above mentioned positive technology industry related points for Apple Inc. there are some
risk factors also present. Apple needs to invest more and more in R&D as of competitive and short
product life cycle nature of industry. Apple designs are unique, but consumers are also giving
preferences to screen size.
https://www.researchgate.net/profile/Md-Alam5/publication/282274921_A_CRITICAL_ANALYSIS_OF_INTERNAL_AND_EXTERNAL_ENVIRONMENT_OF_A
PPLE_INC/links/56ff003908aea6b77468d502/A-CRITICAL-ANALYSIS-OF-INTERNAL-AND-EXTERNALENVIRONMENT-OF-APPLE-INC.pdf
environmental Factor:
Environmental sustainability is a stance that Apple should adopt. As environmental factor has become a
challenge now to Apple. Various of its competitor is now taking a stance for better environment or
environment protection strategies. Thus Apple also need to ensure that its products are environment
friendly and the process of manufacturing is also sustainable.
Apple has already taken some steps towards sustainability such as its commitment to reducing its
carbon emissions by 75% by 2030. And also a promise to use water reasonably.
Legal Factors:
The Company has faced and continues to face a significant number of patent claims relating to its
cellular-enabled products, and new claims may arise in the future, including as a result of new legal or
regulatory frameworks. For example, technology and other patent-holding companies frequently assert
their patents and seek royalties and often enter litigation based on allegations of patent infringement or
other violations of intellectual property rights.( Apple Inc)
Regardless of the merit of claims, defending against litigation or responding to government
investigations can be expensive, time-consuming and disruptive to the Company’s operations. In
recognition of these considerations, the Company may enter into agreements or other arrangements to
settle litigation and resolve such challenges. There can be no assurance such agreements can be
obtained on acceptable terms or that litigation will not occur. ( Apple Inc)
https://s2.q4cdn.com/470004039/files/doc_earnings/2023/q4/filing/_10-K-Q4-2023-As-Filed.pdf