Business-Level and Corporate-Level Strategies
Introduction
Businesses today operate under very stiff competition. Such competition results from companies producing goods and services with similar features and functions. Therefore, to overwhelm the competition, businesses need to produce unique products, continually research new markets, and embrace novel business models that will bolster the business’s competitive position. Due to globalization, the technology industry has become very competitive, with companies like Apple facing competition from players who produce equally superior products and services. Therefore, the company must continually reinvent itself to stay at the top of the technology industry. The paper delves into Apple’s corporate-level strategies that helped the company attain success and its competitive position in the technology industry.
According to Hitt (1), business-level strategies refer to how a business competes in a given industry. To that end, some businesses use pricing strategies, whereas others use differentiation strategies. Also, some businesses may focus on narrow markets, while others focus on wide markets. Apple majorly relies on product differentiation as its primary business-level strategy. The company adopts simple differentiated designs with improved functionalities, a factor that has significantly contributed to the company’s success. Other main business-level strategies at Apple include a focus on the design and functionality of Apple products, expansion of the company’s ecosystem, reduced reliance on a single business unit, and enhanced customer experience.
Product Differentiation
Apple is known for its differentiation strategy. It launched a very stable OS in 1999, followed by upgrades. When Apple debuted the iBook in 1999, it reached a defining moment in its history. This completed their product matrix and Steve Jobs’ simpler product mix approach. From the start, the company has always shown the desire to innovate and improve continually.
According to Hitt (1), a differentiation strategy is a viable approach, particularly if the corporation uses conceptual differences to differentiate its products. In the case of Apple, the company differentiates to improve customer relations, reputation, product mix, and other critical business features. Apple earned a reputation as an innovation by providing a diverse selection of simple-to-use devices in various markets. However, its connections with other companies have been minimal.
Product differentiation also has economic importance, particularly in the context of monopolistic competition. Product differentiation’s fundamental economic benefit is derived from reducing environmental risks. Product diversification costs money, which serves as a barrier to entry, lowering the prospect of new entrants. A firm must incur not just the expenses of normal operations but also the costs of overcoming the uniqueness embodied in the incumbent. Because corporations target specialized markets, there is less competition among industry rivals. Apple has managed to lock out potential competitors by specializing in specialized market niches, making it hard for new entrants to penetrate.
Consumer Ownership
The company also operates a consumer ownership model across its products. That means that users of Apple products (iPhone, iPod, laptops) may only access the company’s technology through these devices (Montgomerie, 2). Although Apple’s software may not always be profitable, its hardware products are. As a result, interoperability is essential to Apple’s business strategy because it helps with the retention of the digital download customer base while increasing the total physical sales volume for hardware products.
Apple continues to use cross-platform integration as a tactic to control how its customers behave when they buy and use media through contractual agreements and IP rights restrictions, as well as technological protections (Montgomerie, 2). Controlling its multiple channels allows the company to put constraints on both suppliers and customers. Apple controls the retail sector by being a key hardware vendor to retailers as well as a major competitor via its retail stores. Apple has made it such that its material can only be viewed via Apple technology, compelling customers to buy its devices.
The strategy has been useful since it helps the company improve sales. The strategy has ensured that the company maintains an end-to-end supply chain. Therefore, any players who attempt to give them competition cannot overcome Apple since they are effectively locked out.
Over the last decade, the firm has built a reputation that exceeds its market share by combining product innovation, industrial design, and creative marketing.
Aggressive IP strategy
According to Hiremath (3), Apple has a reputation for vigorously safeguarding its trademarks, copyrights, and other intellectual property, dating back to its early days of litigating producers of unlicensed Apple II clones. Its IP approach, notably its determination to prohibit computer clones, has made it an example for many of a “closed” corporate model. The company does not entertain even the slightest imitation of its products.
Corporate-Level Strategies
Product Diversification
Product diversification, one of the fundamental corporate-level strategies, is concerned with the extent of the markets and sectors in which the company competes, as well as how managers purchase, establish, and sell new enterprises to match talents and capabilities with opportunities availed to the organization (Hitt, 1). As profits are derived from different business segments, successful diversification is supposed to lessen fluctuation in the firm’s profits. Diversification also allows corporations to transfer their assets to markets with the highest potential returns rather than relying on just one or a few areas. Because organizations incur developmental and monitoring expenses while diversifying, the most profitable portfolio of the enterprises balances the costs and advantages of diversification. CEOs and their top management teams are in charge of choosing the most viable segment to focus on.
Apple’s Diversification Strategy
Apple has already created an effective diversification strategy, both related and unrelated. Apple originally produced full-sized desktop computers but has now expanded to produce a variety of different products, such as mobile phones, portable streaming devices, desktops, and notebook PCs (Gao, 4). Apple has also delved into the digital content distribution market, offering music and apps for its gadgets.
Personal Computers
Competition in the personal computer segment involves PCs and operating systems. Undeniably, Microsft’s operating system has dominated the market since the 1990s. However, newly introduced Apple Safari and Macintosh operating systems have a considerable following. On the other hand, competition in the PC market involves Acer, HP, and Lenovo (Gao, 4)
Mobile Computing
The introduction of the iPod introduced significant changes in Apple’s business strategy while influencing the entire mobile computing technology. Apple is the industry’s most lucrative and profitable corporation by far. Google, Samsung, Nokia, and Asustek are among Apple’s primary rivals in mobile computing.
Entertainment Content
The major producers of digital entertainment content and media are Apple and Google. Apple’s iOS is used in Apple products, while Google’s Android powers rival products. Notably, iOS and Android are integrated, enabling a user to access content across channels. For instance, an Android user can still access Apple’s content through their device. Such interconnectedness facilitates increased usage of Apple products.
Mobile Payment
Apple is a relatively new entrant in the mobile payment segment, having introduced the product in 2014. Within 72 hours of its introduction, the company’s mobile payment program surpassed 1 million customers, giving Apple Pay more users than its rivals combined (Gao, 2021). In general, PayPal and Google are Apple’s key rivals in the mobile payment sector.
Competitive Environment
Consumer Electronics Segment (Smartphones)
Samsung is Apple’s main competitor, mainly computers in the consumer electronics segment. Samsung and Apple create their goods according to trends and have advanced designs; they also take the risk of discontinuing items that are no longer acceptable. Both provide items with elegant designs, high quality, and cutting-edge technology. Many services and apps are connected to make life easier and improve user experience, and their offerings are seamlessly linked together to share resources. On the other hand, Apple enables practically all of its products to be connected, but Samsung only supports connecting and linking devices from the same line. The fact that Apple’s devices are interlinked gives the company a competitive edge over its rivals.
Screen Design
Another area in which Samsung and Apple’s iPhones compete is the screen design quality. With greater size, screen design promotes elegance and enjoyment. Samsung’s screen is spilled out to the sides, commonly known as the infinity screen, for a better video viewing experience. Both companies intend to make the keypad touch rather than the physical button. In terms of screen design, Samsung is superior, while Apple has better technology since it employs OLED panels to provide clearer images.
Samsung and Apple’s ability to suit consumer wants effectively is unquestionable. However, regarding photographic capabilities, waterproofing, operating system flexibility, screen spillage on both sides and more sophisticated design, Samsung’s Galaxy series outperforms Apple’s iPhone line. For example, young people nowadays like snapping selfies and recording unforgettable events. Young individuals are fascinated by the camera, and Apple’s newest iPhone XS series camera design has a protruding camera. This Apple camera is popular among a small number of individuals. In contrast, Samsung’s Note 9 has a flat camera. It is incredibly convenient and eliminates the need to bother about scratching the camera, while iPhone XS requires caution. That indicates that Apple needs to improve user experience in addition to superior technology.
Market Cycles
Technological advances have a significant influence on market demand because technological breakthroughs and improvements in the manufacturing sector are centered on market cycles (Hitt, 1). The technology sector is mostly oriented toward fast-cycle markets. Some items, however, enter slow-market cycles. In the case of Samsung and Apple, smartphones have short market cycles in which they are quickly replaced by newer, more sophisticated models before buyers have completely used their utility.
Apple and Samsung are competing hard to outperform one other in smartphone production. For example, Samsung popularized the S Galaxy trend; before people adopted the brand, Apple replied with the iPhone 5S. There has been a substantial market tussle since both businesses are profitable, and it is impossible to predict which company will dominate the fast-cycle industry. In the slow market cycle, Apple looks to be the best compared to Samsung since it has produced closely diversified items that Samsung has attempted but failed to copy.
Sources
Michael A. Hitt. 2020. Strategic Management: Concepts and Cases: Competitiveness and Globalization 13th ed. Cengage Learning.
Montgomerie, J.(2013). Owning the consumer—Getting to the core of the Apple business model. Accounting Forum, 37(4), 290–299. ScienceDirect. https://doi.org/10.1016/j.accfor.2013.06.003
Hiremath, N., & Gupta, N. (2022). Marketing Strategies Used by Apple to Increase Customer International Journal of Innovative Science and Research Technology, 7(7).
Gao, J. (2021). Analysis of the Diversification strategy of Apple Inc. Academic Journal of Business & Management, 3(9). https://doi.org/10.25236/AJBM.2021.030908
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Question 
In this assignment, you are to use the same corporation you selected for Weeks 3 and 6 assignments. You will examine business and corporate-level strategies and their impact on corporate success comparable to the competitive environment.
Business-Level and Corporate-Level Strategies
Use any or all of the following resources to research the corporation:
The corporation’s website.
Public filings from the Securities and Exchange Commission’s Filings & Forms page.
Strayer University’s online databases.
The Lexis Advance database.
Other credible sources. (The corporation’s annual report often provides insights that other resources may not include.)
(Note: You are expected also to use your course textbook to complete the assignment.)
Instructions:
Use the Business-Level and Corporate-Level Strategies Template [DOCX] to write a 6-8 page academic research paper in which you include the following:
*Note: The title page and source list are in addition to the 6-8 page requirement
1. Assess the business-level strategies most appropriate for the corporation’s long-term success. Support your position with specific evidence.
2. Assess the corporate-level strategies you believe most appropriate for the corporation’s long-term success. Support your position with specific evidence.
3. Analyze the competitive environment to determine the corporation’s most significant competitor. Be sure to compare the business-level and corporate-level strategies for both corporations.
Based on your analysis, conclude which corporation will most likely succeed in the long term. Support your determination with at least three pieces of evidence.
4. Determine whether your corporation or its most significant competitor would differ in slow-cycle and fast-cycle markets. Support your position with specific evidence.
5. Use three or more quality sources, including your textbook, to support your writing. Choose sources that are credible, relevant, and appropriate. Cite each source listed on your source page at least once within your assignment. (Note: Wikipedia and similar websites do not qualify as academic resources)
Access the library or review library guides for help with research, writing, and citation.
6. Produce clear, well-organized writing that applies the appropriate Strayer Writing Standards (SWS) style. Writing contains accurate grammar, mechanics, and spelling.
This course requires the use of Strayer Writing Standards. For assistance and information, please refer to the Strayer Writing Standards link in the left-hand menu of your course. Check with your professor for any additional instructions.
The specific course learning outcome associated with this assignment is as follows:
Determine business-level and corporate-level strategies for a corporation’s success comparable to the competitive environment.