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Thompson (2020) text. Read “Apple Inc: Exemplifying a Successful Strategy” in Illustration Capsule 1.1.
ILLUSTRATION CAPSULE 1.1 Apple Inc.: Exemplifying a Successful Strategy
Apple Inc. is one of the most profitable companies in the world, with revenues of more than $225 billion. For more than 10 consecutive years, it has ranked number one on Fortune’s list of the “World’s Most Admired Companies.” Given the worldwide popularity of its products and services, along with its reputation for superior technological innovation and design capabilities, this is not surprising. The key elements of Apple’s successful strategy include:

Designing and developing its own operating systems, hardware, application software, and services. This allows Apple to bring the best user experience to its customers through products and solutions with innovative design, superior ease-of-use, and seamless integration across platforms. The ability to use services like iCloud across devices incentivizes users to join Apple’s technological ecosystem and has been critical to fostering brand loyalty.

Continuously investing in research and development (R&D) and frequently introducing products. Apple has invested heavily in R&D, spending upwards of $11 billion a year, to ensure a continual and timely injection of competitive products, services, and technologies into the marketplace. Its successful products and services include the Mac, iPod, iPhone, iPad, Apple Watch, Apple TV, and Apple Music. It is currently investing in an Apple electric car and Apple solar energy.

Strategically locating its stores and staffing them with knowledgeable personnel. By operating its own Apple stores and positioning them in high-traffic locations, Apple is better equipped to provide its customers with the optimal buying experience. The stores’ employees are well versed in the value of the hardware and software integration and demonstrate the unique solutions available on its products. This high-quality sale and after-sale supports allows Apple to continuously attract new and retain existing customers.

Expanding Apple’s reach domestically and internationally. Apple operates globally in 500 retail stores across 18 countries. During fiscal year 2017, 63 percent of Apple’s revenue came from international sales.

Maintaining a quality brand image, supported by premium pricing. Although the computer industry is incredibly price competitive, Apple has managed to sustain a competitive edge by focusing on its inimitable value proposition and deliberately keeping a price premium—thus creating an aura of prestige around its products.