Strategies, domestic and global environments, internal capabilities for Apple and Samsung

Strategies, domestic and global environments, internal capabilities for Apple and Samsung

APPLE

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Apple’s unique business strategy gives them the ability to design and develop its own operating systems, hardware, application software, and services to provide its customers new products and solutions with superior ease-of-use, seamless integration, and innovative design. Widely known for its innovation, the company believes a high-quality buying experience greatly enhances its ability to attract and retain customers. (Nielson, 2014)

Apple increases its product demand through differentiation, by making its products unique and attractive to consumers. Despite high competition, Apple products have always been designed to be ahead of the curve and have succeeded in creating demand for its products, givingthe company power over prices through product differentiation, innovative advertising, ensured brand loyalty, and hype around the launch of new products. (Nielson, 2014)Apple maintains the popularity of its high-priced products by only offering retailers a marginal wholesale discount. This small percentage in savings isn’t enough of a profit margin forretailers to offer big discounts on Apple’s products, which means customers end up paying a price close to the manufacturer suggested retail price(or MSRP). However, a retailer could give up this small profit margin and offer products at a discount to attract more customers. Apple prevents this scenario by offering monetary incentives to retailers to sell goods at the MAPs (minimum advertised prices) fixed by the company. (Nielson, 2014)Vertical integrationhas given Apple a competitive advantage. Being its own chip manufacturers, controls manufacturing, follows extremely strict software standards, and operatesin a nearly closed ecosystem of proprietary retail stores. With these advantages, the company hasmore control of its value chain and, more importantly, its component costs. (Nielson, 2014)One of the best things that have helped Apple’s business success is that they are known tohave the most popular, addictive, and tightly integrated ecosystem of all technology companies. The devices and software Apple makes are designed to work well with each other and sync easilyso that preferences and media can be copied or shared with multiple devices without much effort.Applications work on multiple devices at the same time and user interfaces are very similar across devices. (Nielson, 2014)
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There are several strategies that Apple uses to expand its presence in global marketsincluding, but not limited to foreign outsourcing and importing, exporting, foreign licensing, and foreign direct investment. Foreign outsourcing and importing provide production at cheaper costswhich makes products such as the iPad sell for $499 instead of $14,970. (Strategies for Reaching