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Analysis of Apple Company Market Share Loss
  • 4

  • Course Code:
  • University: University Of Law
  • Country: United Kingdom

1.0 Summary Report

1.1 Introduction

This report speaks about Apple's recent loss in its market share and a heightened deprivation in the statistics of its market capitalisation associated with the financial stature of its marketing in both the US and China.

Apple Inc, which is one biggest tech industries that are liked by diverse tech savant public at a long range who prefer its Macbook, its world-famous classic iPhone sets, its laptop and Computer modules are all been designated, as a perfect example of eye-catchy items and a sign of delicacies with high sophistication and valuation in society. 

1.2 Analysis of company and problem/crisis

1.2.1 Analysis of the company and problem

The market valuation of Apple Inc. in the past few years has been elected as one of the exemplary items, because when on the other hand, at a global level, it faced a high rise of revenue generations, then on some of the specific nations, it faced the downgrading of its market capitalisation.

USA, Europe and China are the bigger markets for Apple Inc., which are been followed by Japan, India and the rest of Asia Pacific. Basically starting from 2022, Apple got heavy fluctuations in market shares that created a huge disruption in maintaining its strengthening profile in 2023. 

For example in the USA and China, in 2023's September, it was reported that Apple could not save 200 million US dollars in capitalisation, as it faced big iPhone restrictions in China (Economic Times, 2023). Moreover, Apple also faced a threat from Huawei, the Chinese tech giant, which recently launched its new flagship smartphone, the “Mate 60 Pro”.

This even brought the attention of Joe Biden in this clashing and banned situation. President Joe Biden signed an executive order imposing the blocks and rules on US high-tech investment, specifically in China, which has been reflecting still for intensifying the competition between the world's two largest economies.

In 2023’s August, Apple Inc shares suddenly fell at a rate of 5%, which pushed the market valuation of the tech giants, to below the 3 trillion dollars threshold (Livemint, 2023). On one Friday of August, Apple faced another decline, which was its worst, so far in respect to 2023. 

Another situation explains that at the global platforms, Apple Investors face a 340 billion dollar hole as woes mount (Bloomberg, 2023). This situation is also mostly centred on chinese markets.  

The market shares of Apple in the California-based sector dropped by 4.8% on Friday of August, which resulted in a direct hit in a market capitalisation of about $2.85 trillion (Economic Times, 2023).

1.2.2 Analysis of the problem using the SWOT analysis

Strengths

●       Its sky-rocketing brand valuation and brand loyalty from the customers are a considerable eye-catching point to note. The statistics of its brand loyalty on the global platform are given below.

●       Throughout the history of its operation in the market, it has been successful in grossing the status of 3 trillion dollars in market revenue.

●       It is the grand platform for the tech savants, and a destination for tech innovations and ecosystem integration while contemplating diverse technological assimilation with diverse job faculties at its worldwide stations.

.

Weakness

●       Its high dependency on the iPhone, caused it to reduce the valuation of the Macbook, and other items in different nations. For instance, it promotes iPhone with considerable price rates, but it markets its Macbook with lower prices or per se cheaper, in New Zealand (Horne, 2023).

●       The price of its iPhone is such a problematic situation, that in contrast to Android mobile phones, which even the middle-class public can buy, the iPhone is not for financially fluctuated demographics, especially in the Asian Pacific and Middle Eastern regions. Even European audiences have pointed out the inflated price issues.

●       In October 2022, Apple got to pay a fine of 19 million, by the São Paulo State Court. As of its decision to remove the phone chargers from all of its iPhone sets’ packages. This had been considered a litigation issue over the past few years. This has been a factor of product concentration regarding customer preferences (Business model analyst, 2023).

Opportunities

●       Its service growth is a big opportunity for its revenue channelling from its marketing timeline, opening diverse physical stores like the App Store, and Apple TV+, for diverse revenue generation at worldwide platforms.

●       Vast technological proliferation, assimilation and advancements, have a chance to flourish, in any kind of untapped market, depending on its global status. 

Threats

●       Competition from Microsoft regarding its OS.

●       Competition from Android systems from Samsung, China’s Huawei, which promotes the product with considerably lower prices than Apple’s iPhone.

●       Apple used to pay 24 per cent of its foreign market tax in Europe and now in 2023, it has risked 14 billion dollars at the top with the European Union's (O’Carroll, 2023). Thus as an output it got Apple suffered from a setback in a conflict against the  European Union's order to pay an 11 billion pound tax bill in Ireland (Livemint, 2023).

Table 1: SWOT analysis of Apple Inc 
(Source: Self-Created in MS Word)


 Revenue generation of apple inc
Figure 1: Revenue generation of Apple Inc in 2023
(Source: Statista, 2023)

1.3 Trends and Opportunities

PESTEL assessment of Apple Inc
 

Factors for evaluation

Descriptions

Political

Apart from any heavy political complications, Apple gets to pay a smaller amount of income taxes, during the fiscal ending period of 2023 with 16.741 billion dollars which is 13.26% lower than 2022’s 19.3 billion dollars (Macrotrends, 2023).  However its Tax risks in the EU have been considered a problem for its market shares regarding the revenue stability, it gross from Europe.  Recently the issue with China even provoked a sheer political disruption against the USA for its iPhone marketing.

Economic

It has a big positive factor, but its present reduction in the market capitalizations from China and California or litigation from the EU. Consumer slowdown can have a bitter impact on its marketing shares.

Social

Nationalism ideology can be a problem for Apple because recently China has also focused on its Huawei brands more promptly than investing in its iPhone brands (Forbes, 2019). Customer preferences are thoroughly changing and it does not like some of its packaging decisions.

Technological

It has increased technological regulations while channelling high proliferating technological proliferation and advancements.

It has brought Siri, personal AI voice Assistant, New Airpods, Face ID facial recognition system, Mac OS X, OS 7, a new App Library in iOS 14, and Apple Pencil in iPadOS 14 with enhanced handwriting capabilities (Knutsson, 2023).

But still, it has cybersecurity fractals, cause recently in 2023’s December, the iPhone’s functionality faced cybersecurity because, it backlashes it bypass authentication, even though it has storing iCloud (CNBCTV18, 2023).

Duplicacy risks are associated with third-party logistics.

Legal

Apple News to assist its fundamental business modules with the recent strict data protection laws of different nations. Faced different local and national lawsuits, as recently in December 2023, it faced a lawsuit for 25 million dollars with burden and cost litigation, that is entitled "Walter Peters v. Apple Inc" (Times of India, 2023). This is not the newer one, during its market shares it faced a good lawsuit list.

In 2023, it paid a 30 million dollar settlement over employee bag check issues (The Hindu, 2023).

It started paying out $500M in the iPhone slowdown lawsuit (Reichert, 2023). 

Environmental

Its Net-zero initiative is getting involved with collaborations while bringing different brands to partner with it, to present the solutions for the water scarcity (Times of India, 2023).


Table 1: The PESTLE analysis of Apple Inc 
(Source: Self-Created in MS Word)


 brand value of apple
Figure 2: Brand Valuation of Apple Inc in 2023
(Source: Statista, 2023)

Recommendations: 

  • The implication of its strategic intervention while bringing the different initiatives and brands for meeting up water scarcity issues for maintaining the viability of the environmental sustainability goals has remained a good factor for it, and it must continue this positive point. 

  • It must maintain data protection and technological regulations in different countries. For more security, it can now incorporate with other tech industries, though it could be like seeking help from its competitors, for bringing the Quantum computing advancements more proliferation for strengthening its iCloud and data security protection statements (Omaar, 2021). Apple Inc. while implying final warnings to the third-party logistics for duplicity claims. 

  • It needs to make better implications of its reputation management while perceiving better ethical business practices and privacy and focusing care on its social and legal dignities. Reputation management theory speaks about controlling employee engagement with the public demand (Pollák et al., 2019).

    Now, the basic need of them is to not get into conflict by firing the employee bases. Though this aspect has a preliminary reason for having lower market capitalisation, Apple's productive marketing attributes and innovative prospects can help them to subdue this anomaly in the future if it makes more considerable technological innovations with country-wise price rates (Aula and Mantere, 2020). 

 reputation mgmt
Figure 3: framework of Reputation management theory
(Source: ReputationX, 2022)

1.4 Global Strategic Options and role of leadership

1.4.1 Strategic Option 1: Market development through product diversification

Aim of Strategy by BCG Matrix: Especially in China, California, Japan and Europe, it would be a “question mark” and “problem Child” section of the Matrix (Theophilus, 2022). 

Tactics by Ansoff Product-Market Mix: The one primary implication would be introducing new products or innovative ones by expanding its area in new regions, to escape from the strict problems. It would be hard, but it needs to turn its focus from China slowly and focus on marketing iPhones in its Cheaper markets, though at a lower rate at first, to have a grip on the newer or old experimented regions. it can also streamline operations while reducing unnecessary expenses, by engaging with renegotiating contracts to improve cost efficiency (Cleberg, 2019). 

Method of Strategy or Competitive Generic Strategy: It must rely on the strategic appreciation of differentiation by introducing the unique features of its existing product or by completely bringing newer models (Furr et al., 2022). For example, it can be sturdy, Samsung’s display or Huawei's models more precisely, because it has already been channelling the Samsung display traits from Japan. It can leverage the premium brand image for justifying its higher prices.

Leadership and Leadership Styles: CEO Tim Cook must adhere to the transformational and collaborative leadership style, to not face further rejections from any other countries. Furthermore, cost leadership would also be an important factor for them (Amit and Zott, 2020). 

Justification: It needs the feasibility for marketing its newer resources to make the derived market capitalisation and increase its investors for newer markets.

Also Read - Leadership Assignment Help

 1.4.2 Strategic Option 2: Rebranding for reputation management 

Aim of Strategy by BCG Matrix: Instead of the USA, China and European nations, it has the other Asian Pacific and Middle Eastern regions with Japan in it.

This section could be present as a Cash Cow for them if it successfully wants to proliferate the declining market shares that got lost while tackling the tax factors and making a new iPhone launch in both California and China this year even though it has been sued many times, which highly costs them dollars regarding employee extraction from the remaining.

But more likely, when social and legal complications are also present, then this situation would also be resided, in between the “cash cow” and “Dog” (Zugay and Zakaria, 2023). 

Tactics by Ansoff Product-Market Mix: It could meet up with aggressive marketing or making up for the promotional campaigns, and induce the administration of competitive pricing strategies, and also it would be a positive sign if emphasizing social responsibility and positive contributions (Frank et al., 2023). 

Method of Strategy or Competitive Generic Strategy: This section would also state its focus on the differentiation of price and also maintaining the lawsuit complications. To maintain global regulations and the sustainability of regular compliances regarding waste production and lawsuit situations, they need good bundled services and subscription models (Hovenga and Hullin, 2022). The utilisation of the subscription and bundled logistic services would give brand loyalty much in the newer regions. 

Leadership and Leadership Styles: It requires further implication of visionary leadership, and servant leadership for Tim Cook to thoroughly analyse the newer environment and the primary regulatory goals and problems. 

Justification: It must be a cost-optimisation procedure for Apple and Tim Cook to evaluate the marketing range. 

Also Read - Strategic Management Assignment Help

2.0 Conclusion

The report encompasses the important scenarios, where Apple Inc. has faced a considerable loss in grossing a heightened state of their revenues while facing a severe decline in their brand valuation in different nations, where the competition, issue of strict nationalism prospect, the lawsuit from the public and employees, tax administrating factors are creating a deviating situation for the brand to remain in a sustainable reputative position.

It is slowly losing the strength to be competitive in the market, that is why, through Ansoff, PESTLE, SWOT and analysis with the ideology of reputation management, the report has described certain productive points. 

3.0 Recommendations

The recommendations focus on more transformation and enabling diverse collaboration as channelling investors for their resources, Apple must imply the collaborative and cost leadership status.

Even though, throughout the marketing timeline, Tim Cook has become successful enough to have that trait and meet the urgency, when the case is of higher importance, it has been recommended to look for newer regions, with lowering its prices on the iPhone precisely not on the other substantial norms.

A balanced approach with assertive interventions for increasing its cost optimisation and keeping the position of the market capitalisation intact. 

4.0 Reflection

Through Gibbs's reflective model, this section is extended:

Description: 

I can specify that through this report, I have come across Apple's fresh marketing challenges regarding its lowered market capitalisation while maintaining its sustainability toward being one of the best in the global market (Adeani et al., 2020). 

Feelings:

I felt a bit overwhelmed at first, due to pointing issues against such a big brand with no proper strict managerial data for recommendations at a crucial time, based on its fallacy. 

Evaluation:

Positive Aspects:

I have built an interpretation of Apple's fresh marketing challenges regarding its lowered market capitalisation and the linked reasons with it and these complications can be apprehended by having some substantial recommendations for instigating future success proliferation in newer marketed regions.

Challenges Aspects:

To specifically adjoining the management ideas was a problem for me, at first because diverse managerial theories regarding helping capitalisation are present (Nurlatifah et al., 2023, December). 

Analysis:

I have pointed out crucial recommendations on Tim Cook’s leadership style, even if it could manage to have the transformation quickly. 

Conclusion:

I have gained a commendable idea on Apple's fresh marketing challenges, acknowledging the leadership dynamics and some recommendations with diversification ideas.

Action Plan:

I can make this report quite productive next time if I get to enhance evaluating further deeper complications that Apple is facing, through aligning with leadership theories more conveniently.

 

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References

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