Can Phil Schiller Keep Apple Cool? Term Paper Example

During Steve Jobs’ era, Apple introduced at least three products that took their respective industries by storm and helped establish Apple as arguably the most innovative technology company in the world. These products, i.e. iPod, iPhone, and iPad were not the first of their kinds but they did things and did them correctly before anyone. While Apple was known for introducing revolutionary products, now the company’s innovation is measured in terms of not products but features like high resolution “retina” display (Burrows & Satariano, 2012) which does make one wonder if the Apple’s brand is really in jeopardy following the death of Steve Jobs. If we look at the current product line, iPad is the last revolutionary product introduced by Apple and ironically it was also the last revolutionary product introduced in Steve Jobs’ life. Apple’s capacity to innovate has really suffered due to the loss of its visionary leader and unless Apple regains its mojo, its brand may continue to decline.

One of the problems with rising to the top is that a company has no place but to go down. It may not be an overstatement to claim that protecting the crown is much more difficult than achieving the crown and with Jobs, Apple is struggling to protect the crown its legendary CEO helped it achieve. But there is always a solution even if it may be difficult one and require tremendous sacrifices. As far as Porter’s Generic Strategies are concerned, Apple should aim for differentiation (MindTools). Apple may be drifting towards cost leadership gradually in order to increase sales volume but differentiation had always been the company’s preferred strategy since its very founding and it is exactly what contributed to Apple’s success under Steve Jobs. Jobs was never focused on volume because he wanted to give customers the best product quality and user experience. Unlike Microsoft, Apple didn’t license its operating system and other software products to third parties and Apple still exerts control over software and hardware development which is an anomaly in the technology sector. Differentiation strategy may not yield maximum sales but it does help the company reduce competitive pressure and enhance pricing power as well as profit margins,

As far as segmentation strategy is concerned, Apple should focus on psychographic segmentation and segmentation by benefits. Apple has always prided itself on providing products that meet customers’ need or solve customers’ problems better than the rival products. Apple has never been a mass-market brand though iPhone and iPad may be changing it but this focus on sales volume due to competition with Samsung and Google among other competitors is taking the company’s focus away from its core competencies. Apple should not aim to be a mass market brand but should go back to its roots and try to target and serve selected market segments that want the best products and are not afraid to pay premium prices for it. As competitors like Samsung are narrowing the quality and innovation gap, Apple’s profit margins have been falling (Pepitone, 2013).

As profit margins continue to decline, Apple’s management will eventually realize that the current focus on sales volume is not sustainable in the long term. Technology sector is extremely competitive and characterized by low profit margins and companies like Apple are rarity rather than the norm. Apple’s fortunes can change but the company will have to go back to its roots. And there are signs the company is already doing so as Tim Cook has promised new products this year (Rogowsky, 2014).

Works Cited

Burrows, P., & Satariano, A. (2012, June 7). Can Phil Schiller Keep Apple Cool? Retrieved June 6, 2014. Web.

MindTools. (n.d.). Porter’s Generic Strategies. Retrieved June 6, 2014. Web.

Pepitone, J. (2013, October 28). Apple’s profit concerns linger. Retrieved June 6, 2014. Web.

Rogowsky, M. (2014, June 2). As WWDC Opens, A Quiet Tim Cook Takes The Stage While His Critics Keep Making Noise. Retrieved June 6, 2014. Web.