SWOT analysis of Apple

Strengths

Strong brand image

Apple well recognized amongst consumers, Apple’s products are enjoy a high level brand awareness and brand recognition throughout the all the market. This is evident with the rapid sales of new Apple launches. For example, the net sales of iPad and related products and services were $5 billion and unit sales of iPad were 7.5 million during 2010. According to the industry sources, Apple is the fourth largest player in the global mobile phone market. The strong brand image gives the company an edge over regional and global competitors.

Robust financial performance

Apple reported robust financial performance in the past few years. The company’s total revenue increased to $65,000 million in 2010 from $19,000 million in 2006, it representing a compounded annual growth rate of 36%. Apple has resulted in higher cash and cash equivalents of strong operating performance. For example, strong growth in revenues and confidence, as well as allows it to invest in the future growth avenue.

Apple now used high and the latest technology to produce out their new products. For example, Apple released the iPhone that entire concept of the smartphone was re-defined. No longer was it a device with a screen and hardware keyboard, either using a stylus or a scroll wheel and buttons for input, iPhone was all screen and used touch as its means of input. Besides that, iPhone made everything about the software means of user interface were displayed on screen and interacted with via touch.

Weaknesses

Limited edition of products

The major weaknesses of Apple are that they are the only company that they can make their own products with the operating systems like OSX and iOS. In fact, Apple will offer a simplified product line and will get a very limited set of products in comparison to those using other systems. For example, iPhone4 cases are created limited edition for their certain designs and patterns.

Products recalls may harm reputation

Apple company products and services experiences quality problems from time to time. Apple sells highly complex hardware and software of their products and services that can contain defects in design and manufacture. For example, Apple iPod Nano may have a faulty screen. Apple company has commented that a batch of its products has screens that break under impact and the Apple company is replacing all faulty items to the products.

Opportunities

Strongly growth in smartphone market to boost in Apple’s revenue

Nowadays, the world smartphones market segment is forecast to record a strong growth in coming years. Besides that, the shipments for smartphones are expected to exceed almost 400 million globally. The number is expected to reach approximately 850 million by the end of 2013. For example, Apple became the third largest player in the smartphone market segment in US since launching their first mobile device, is iPhone in 2007.

Robust outlook for mobile advertising

Smartphone advertising market is forecast to recover and have a modest growth in the near future. According to industry sources the smartphone advertising market is forecast to reach approximately $25 billion in globally by the year 2015, riding on the strong growth of smartphones in both developed and emerging nations. For example, in April 2010, Apple launched it advertising platform, iAd.

Threats

Increase popularity in Google Android

The Google Android OS for smartphones is gaining rapidly popularity. In 2005, with the acquisition of Android and the subsequent launch of Google’s mobile OS, Android changed the competitive landscape of smartphones business globally. For example, the online application stores for Android applications called as Android Market is now growing at a rapid pace. The Android Market currently offers approximately 250,000 apps, compared to 350,000 apps that offered by Apple’s App Store, although Android has been a late entrant in the market.

Intense competition may affect revenues and profitability

Apple operates in a highly competitive and rapidly evolving technology industry. The company faces intense competition in consumer electronics that included PCs and related software and products markets. The company’s competitors include Microsoft, Dell, Samsung and more. For example, Apple is currently focused on market opportunity related to mobile communication devices including the iPhone. Furthermore, launch of iPhone highly the demand for smartphone with touch functionality and other innovative features.