SWOT Analysis On Apple Inc, Essay Example for Free

This is a free Apple SWOT analysis available for all students. You should use it only as a reference.

Table of Contents

Company Details

CEO:	Tim Cook (Aug 24, 2011–)
Founded:	April 1, 1976, Los Altos, California, United States
Headquarters:	Cupertino, California, United States
Founders:	Steve Jobs, Steve Wozniak, Ronald Wayne
Products:	iPhone, Apple Watch, iPad, Apple TV, macOS, iOS, AirTag
Subsidiaries:	Beats Electronics, Beddit, NextVR, Inc., Apple Store

Apple Inc, or more commonly Apple, has been one of the most astonishing stories in the world of technology. With its humble beginnings and bumpy road to stardom, the company has truly evolved from a designer brand to everyone’s choice.

In the coming years, the company has successfully launched and sustained some of the most iconic Apple products, including Macintosh computers (now Mac), iPods, iPads, Apple Watch, and the most successful product in the history of the company – the iPhone!

These days, it is considered to be the most valuable multinational technology company in the world with a brand value of $355,080 million. It has also offered new services and digital streaming lineups that make up to 18% of its annual revenue.

Still, the company faces a tough time in each segment it tries to diversify its portfolio, not to mention controversies and a less-than-perfect business model.

Let’s try to see all the advantages and disadvantages apple is a through a SWOT Analysis.

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SWOT Analysis of Apple

A SWOT Analysis is a tool that gives useful insights to stakeholders when they need to determine where a brand stands. It encompasses all the internal and external aspects of the company to adjust both short-term and long-term policies.

SWOT Analysis is conducted in detail, but for the sake of presentation or to highlight key insights, it is plotted in a square with four quadrants. Two quadrants carry internal factors, which are strengths and weaknesses, and the rest of the quadrants inform about the external factors, which are opportunities and threats.

Apple has a diverse portfolio that allows it multiple income streams. It has a strong footing as a brand in America and Europe, especially, but it faces a lot of backlash due to its policies and products.

Before we take a look at the Apple SWOT Analysis and SWOT table, let’s dive deep into the analysis.

Apple’s Internal Factors

For better understanding, it is best to start with the strengths of a brand before taking a hard look at the challenges it might face.

💪 Strengths

So, these are some strengths of Apple that place it at a great advantage when compared to its competitors:

Brand Value

Apple has been consecutively securing the first position in the brand ranking by all the reliable valuation sources to become the most valuable brand of all time. The brand value for Apple is over $400 billion which is almost doubled that of the second global brand Amazon.

Global Following

Even with its limited and selective advertisement and media campaigns, Apple is slowly dominating the consumer market for computers and other lifestyle products and services. However, Apple enjoys a global following with people lining up outside Apple stores to get a newly released iPhone as soon as possible.

Cutting-Edge Technology

In many technological areas, Apple is still leading the pack when compared with its competitors. Since the company’s inception, it has vowed to produce and market the best and most innovative products through cutting-edge technology. From the very beginning, this has been the strongest suit for Apple.

Market Leading R&D

All these exciting products and services would not have been possible without research and development. Apple takes great pains in testing and developing new products by allocating a handsome proportion of its revenue to R&D. Estimates put that value around $22 billion.

Sustainable Product Development

As far as the iPhone is concerned, the most popular and profitable Apple product, it is enjoying sustainable development and design. Apple has developed a robot called “Liam” that can disassemble old iPhones and harvest their parts. Then, these parts are stored properly so that they can be used for the manufacturing of new iPhones or other Apple products.

Diverse Products & Services Portfolio

In the beginning, Apple was essentially a hardware company. Now, it has successfully expanded its products and services into hardware, software, digital streaming, and wearable streams, as well as gaming through Apple Arcade. This has brought immense revenue dollars to Apple. These include Apple Music, Apple Watch, and many more.

The consumer electronics company is still expanding in smart technology for commercial as well as home and lifestyle usage.

🤒 Weaknesses

Following are some of the weaknesses that Apple has to cope with as a brand:

High Price Tag

One of the biggest weaknesses in Apple’s business model is the high pricing for its products. That’s why they can’t target a wide range of demographics because many couldn’t afford to pay top dollar.

Adversity Through Diversity

The dramatic expansion in Apple’s products and services could be termed as its weakness. While entering new domains, Apple is facing giants in the industry with a solid consumer base and cost leadership.

In gaming, digital content streaming, and payment services through Apple Card, the company is facing adversity from the likes of Netflix, Disney, Paypal, etc.

Proprietary Hardware & Software

Apple erects high walls around its hardware and software. This allows security and stability on one hand, but it hampers versatility and connectivity on the other hand. This is a big weakness in Apple’s business model.

Tracking Allegations

When it comes to unfair business practices Apple Inc has faced serious allegations from users that the company was tracking their location and personal information without explicit consent. This has put a dent in its reputation resulting in a loss of consumer trust points.

Questionable Business Practices

The investigations are going on regarding Apple taking payments from Google to make Google Search the default search engine for Apple products. Again, this has brought a lot of scrutiny and criticism from other search engine companies.

Poor Parental Controls

Apple faced a lot of backlash from concerned parents regarding the ineptitude of its proprietary parental controls. The company claims that they are the best in class but parents are of the view that they still can’t keep tabs on kids’ online activity.

Apple’s External Factors

After taking a hard look at both of the internal factors that affect the input and output of Apple as a company, let us explore the external factors that can affect it.

🤑 Opportunities

The opportunities that are at the company’s disposal are given in the section below:

A team of brilliant engineers, a diverse product portfolio, and expansion in automobile ventures will bring better returns for Apple.

Top-Notch Professionals

Apple is known to have the best and most qualified engineers and developers employed at its locations. They have continuously come up with exciting and profit-making products and services. By getting more and better people on the teams, Apple can continue its streak.

Consumer Retention

When it comes to exceptional customer experience and no-nonsense technology, Apple leads the market. With a consumer retention rate way above 90%, Apple can create further opportunities for itself by entering new relevant markets.

Distribution Network & Channels

Apple controls the lion’s share of its distribution now. But with diverse services and innovative products, the company can devise an expansive distribution network and channels to further capture the market.

Expansion in Wearable Technology

Apple is focusing on wearable technology. Since the market is expecting tremendous growth in the short run, Cupertino can enjoy immense profits and a pioneering role in this sector.

Adoption of Artificial Intelligence

Almost every technology-providing company is assimilating AI start-ups into its fold. Apple has been shy about this until now. Recently, it has acquired two AI companies which helped Apple is integrating AI solutions into its products.

Autonomous Automobile Ventures

Apple has shown great interest in the automobile sector. With the success of Tesla and other EV-based autonomous vehicles, the company wants to enter the market with its proprietary software and hardware.

Kia is also in talks with Apple to produce autonomous driverless cars. The production is expected to start in 2024 and the target for the first year is to produce 100,000 cars.

😨 Threats

With the number and scale of technological advantages and higher index of consumer trust, it is hard to think a company like Apple could face threats to its business. Yet, it does!

Here is an overview of the possible threats.

Dependency on China for manufacturing and supply chain, lawsuits, and bad publicity are some of the biggest threats Cupertino is facing.

COVID-19 & Dependency on China

The dependency of Apple on China for manufacturing its products has come under great pressure due to COVID-19. With the disruption in the supply chain and shutting down of manufacturing units, Apple is facing pressure to adapt its models.

Flawed AirTags

AirTags made a splash at their launch but the privacy and security concerns have been mounting up since then. Many reports have emerged where people had their cars stolen or were stalked using AirTags.

Apple has developed some cautionary measures but they are far from perfect.

Counterfeit Products

Regions like India and Africa are rife with “fake” iPhones and Apple Watches. These substandard items are not only cutting into Apple’s profits but also damaging the trust people have in the products.

Mishandling of Consumer Personal Data

Apple Inc has drawn a lot of criticism for getting involved with the government to provide personal data in criminal cases. Users are now suspicious about whether they can trust the brand that championed technological privacy above all else.

Competition From All Quarters

Brands like Samsung, Google, Huawei, Xiaomi, etc, are giving a hard time to Apple when it comes to the smartphone market. They all use Android software with proprietary hardware which allows them to create cheaper and more feature-laden products.

Lawsuits Brought Bad Publicity

From throttling older iPhones to mishandling consumer data, Apple is facing tens of lawsuits. Apart from financial damage and public scrutiny, these legal episodes can severely damage brand value.

Apple’s App Store Controversy

Apple has been continuously blamed by other companies for promoting monopolistic practices in its App Store. Companies like Stadia and Facebook are locking horns with Apple in this regard.

Apple SWOT Table

Strengths

💪 Brand Value
💪 Global Following
💪 Cutting-Edge Technology
💪 Market Leading R&D
💪 Sustainable Product Development
💪 Diverse Products & Services Portfolio

Weaknesses

🤒 High Price Tag
🤒 Adversity Through Diversity
🤒 Proprietary Hardware & Software
🤒 Tracking Allegations
🤒 Questionable Business Practices
🤒 Poor Parental Controls

Opportunities

🤑 Top-Notch Professionals
🤑 Consumer Retention
🤑 Distribution Channels
🤑 Expansion in Wearable Technology
🤑 Adoption of Artificial Intelligence
🤑 Autonomous Automobile Ventures

Threats

😨 COVID-19 & Dependency on China
😨 Flawed AirTags
😨 Counterfeit Products
😨 Mishandling of Consumer Personal Data
😨 Competition From All Quarters
😨 Lawsuits Brought Bad Publicity
😨 Apple’s App Store Controversy