helps companies build products customers love and be happy doing it. There is also a strong vertical integration of software, hardware and services which makes Apple have a very competitive and functional ecosystem that it operates in. Once you understand that, you can see which other products compete in that space. They outline four steps to follow to achieve differentiation: 1. The partner of working wider is thinking wider. Tech giants Apple have been selling their line of products such as the Iphone, the Ipad and the Ipod for about a decade now. ( Log Out /  A company’s differentiated product will appear more attractive relative to substitutes, thus reducing the threat of substitutes. To resolve these dilemmas, there must be an appropriate organization structure. This marked the beginning of Apple’s new strategy of making the Mac the hub for the “digital lifestyle”. The company is well known for its innovative products such as Macintosh line computers, the iPod. Until then, feel free to read more about MWS, explore how we can assist you further. In many industries, the barrier to entry has dropped significantly in recent years. If there is no direct, easy duplication and there are no easy substitutes, the strategy is difficult to imitate. In this article, we discuss how such industry leaders as Amazon, Apple and 3M, use differentiation strategies to achieve profitability and customer loyalty. The cost of product differentiation acts as a barrier to entry, thus reducing the threat of new entrants. Apple prides itself on its innovation. It also gives them a better chance to compete against more popular products. With all of Porter’s Five Forces lower, a company may see economic value from a product differentiation strategy. MWS thrives in the B2B arena. ( Log Out /  The only person who’s qualified to run this company was crucified 2,000 years ago.” Since Jobs took over as CEO in 1997, Apple seems to have resolved the innovation dilemmas, evidenced by their numerous innovations. Its first home computers, the Apple ][ (pronounced "Apple 2") series in the 1970s and 1980s, do not appear elegant from a modern perspective, but they were breakthrough at the time for their ease of use and setup, at a time when competing computers had to be literally built by hand from a kit of parts. Maintaining Brand Reputation & Loyalty The need to continuously develop and implement new differentiation strategies to sustain competitive advantage d) B) Visit http://www.miniworkshopseries.com now to find out more. Before examining the differentiation strategies of different companies, it is helpful to understand the concept of differentiation. Let us take a look at some product differentiation examples. There’s also the services such as Itunes and Apple store which sell apps and music on the go. Create a free website or blog at WordPress.com. While the benefits of the workshops is resonated across the organization. lets talk about some of these advantages shall we? Porter’s Generic Strategies are the standard basic strategies that a Business can follow, suggested by Michael Porter.. In 2001, Apple hit another important historical point by launching iTunes. Product differentiation is a marketing strategy that focuses on showing off the differences between your product or business and the competition. Those that are relevant to Apple are product features, product mix, links with other firms, and reputation. Apple 's Corporate Strategy Analysis 4738 Words | 19 Pages. these services are competed by google with their services of Google music and Playstore. New devices like the iTunes compatible iPod, capable of downloading full-length movies in a wireless mode, is seen as a natural product extension guiding Apple's future. 2. This role also resolves disputes, particularly among the other leaders. Managerial freedom within broad decision-making guidelines will resolve the institutional control dilemma. It can be useful because they then have a chance to compete against bigger companies. ( Log Out /  In 2003, Apple released the world’s fastest PC (Mac G5), which had dual 2.0GHz PowerPC G5 processors. Businesses use the marketing strategy of product differentiation to distinguish their own products from those of their competitors. Apple is a multinational technology company (you may have heard of them ;)) that produces super popular products like the iPhone and MacBook Pro laptops. however, with the advent of Android and the windows phone the company is losing its competitive advantage as these new companies provide the same features as an Apple product but at a much lower price and due to this Apple risks becoming restricted to be known as a high end niche company. To continue a product differentiation strategy, Apple must continue its appropriate management of innovation dilemmas and maintain the five leadership roles that facilitate the innovation process. The product differentiation process may be as simple as redesigning of packaging to introducing a brand new functional feature in a product. Some of the most prominent examples include Apple’s iPhone, Sony’s PlayStation, or Toyota’s Corolla car. The institutional leader creates the organizational infrastructure necessary for innovation. There is economic value in product differentiation, especially in the case of monopolistic competition. However, its links with other firms have been limited, as we will discuss in the next section on strategic alliances. Apple has had a very strong public association with high quality design for most of its history. Apple … the main differences that Apple provides is that :-. Apple had issues within its organization. iPhone and iPad hardware products (Christopher, 2010). How Apple Inc. positions from the competitors like Samsung, Nokia and Huawei comes through their ability to deliver exceptional experience through superb user interfaces. Guest: Andrea Olson, Founder & CEO Prag’madik, Author of No Disruptions - The N… Features - Your product has unique features. Apple Inc. is an American corporation that designs and manufactures computer hardware, software and other consumer electronics. Product differentiation is a mark eting strategy whereby . This allowed iTunes Music Store online to offer over 200,000 songs at introduction. Performance - Your product outperforms the competition. this is due to the fact that in most countries Apple products are considered vary expensive and the consumers generally opt for cheaper phones which offer the same features at a much lower price, for example, android phones manufactures by google, motorola  and Samsung. It is a radical approach to learning and training engaging the HR, the line managers and the whole workforce. The different factors on which the process is implemented include: Define the context and the competition. Find a differentiation idea. Later, Apple introduced the easy-to-use iMac in 1998, and updates following 1998. Those that are relevant to Apple are product features, product mix, links with other firms, and reputation. The company headquarters is in Cupertino, California, CEO and co-founder is Steve Jobs and the company boasts of 284 retail locations spanning 10 different countries. Even though Apple still carries its brand name and a very strong presence in the market. they can afford to set a higher price than that of their competitors as the products continue to be of great quality and have a long lasting life and the consumers know this. Since a company with a differentiated product competes as a quasi-monopoly in its market segment, there is a reduced threat of buyers. Apple tries to prevent its rivals from developing lower cost and lower priced items that have the same features as their products. it is slowly being taken over by Android as the leading smartphone software due to its cheap prices and similar features. The Scope of the Market targeted. For this to occur, a product differentiation strategy that is economically valuable must also be rare, difficult to imitate, and the company must have the organization to exploit this. Challenges a) b) c) Is it possible to increase profit margins while maintaining product differentiation strategy ? The Competitive Advantage of the company.. What makes the Company “Strong” in the Market. There are five well-known levels of differentiations. In increasingly crowded competitive landscapes, differentiation is a critical prerequisite for a product’s survival.What does your product or service do/accomplish/offer that the competition does not? Now, what does this look like in action? These higher prices are set by Apple as they have been in the game for a really long time and have established a target demographic. Change ), T1 2016 MPK732 Marketing Management (Cluster B). Googles strategy to acquire Motorola and Microsoft’s strategy to acquire Nokia were to do the same thing Apple did and vertically integrate. Another factor, which of course is considered a part of the product, is Apple’s unique operating system. Differentiation strategy examples: Apple. Product differentiation is a viable strategy, especially if the company exploits the conceptual distinctions for product differentiation. ( Log Out /  Example: Apple — Differentiation Strategy. Retail branding requires strategy, which is the tactics a company adopts to arouse consumers’ interest in its brand. As a side effect, these industries have seen substantial increases in competitive products. Examples of Product Differentiation. never introducing a price ceiling with any Apple product that’s actually being launched in the market. All of these products are unique to what Apple’s competitors are selling which is why there is so much buzz around these products. This is important as Apple dominated this market by a majority share of 63% over 37%. ]]> Fill in your details below or click an icon to log in: You are commenting using your WordPress.com account. These are product, services, personnel, channel and image differentiation. If suppliers increase their prices, a company with a differentiated product can pass that cost to its customers, thus reducing the threat of suppliers. Apple was established on April 1st, 1976 by Steve … In reference to Apple’s recent advancements, Jobs said, “We are going to do for digital creation what Microsoft did for the office suite productivity.” That is indeed a bold statement. MiniWorkshopSeries offers solutions to 2 main sets of demographics – the corporate sector and the entrepreneurs. There are four primary organizing dilemmas when considering product differentiation as a strategy. ‎In this episode, we talk about the key to differentiation as you learn how manufacturers can achieve differentiation. The problem with this strategy is that Apple can charge a premium price as long as they maintain a competitive advantage over their competition. ... Apple's iPhone and Google Pixel which operate on skimming price strategy. The primary economic value of product differentiation comes from reducing environmental threats. The critic challenges investments, goals, and progress. Apple owns its chip manufacturers, it sells its products in retail stores that are owned by Apple, and its software controls are really strict. Since companies pursue niche markets, there is a reduced threat of rivalry among industry competitors. they make high quality items that their competition would find hard to … Learning from the top innovators in the world – MWS aspires to innovate products and services to address the impeding needs of the workforce and organizations. This completed their “product matrix”, a simplified product mix strategy formulated by Jobs. ... marketing-examples-strategies-de finition.html [4.] This has started tot become evident as Apple’s chief competitor, Samsung has a majority market share in the smartphone industry. this ceiling could result in Apple having to cut down on prices when it comes to the long run. Time will tell whether that happens. Tech giants Apple have been selling their line of products such as the Iphone, the Ipad and the Ipod for about a decade now. >>> G3 iMac, Consumer Segment >>>>> PowerBook iBook. But you’d need to recruit God to get it done.” Michael Murphy, then-editor of California Technology Stock Letter, stated, “Apple desperately needs a great day-to-day manager, visionary, leader and politician. they make high quality items that their competition would find hard to mimic and sell at a lower price for the same benefits. If there are fewer firms differentiating than the number required for perfect competition dynamics, the strategy is rare. 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Apple Business Strategy Pt 2 Strategic Alliances, Apple’s Business Strategy Pt 1: Product Differentiation, 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Corporate Entrepreneur. One example of differentiation strategy is Apple Inc.: Businesses use the marketing strategy of product differentiation to distinguish their products from those of their competitors. Examples of product differentiation including unique design, customer service, and price. Product differentiation is a viable strategy, especially if the company exploits the conceptual distinctions for product differentiation. They are as depicted below. MWS product matrix is as follows: : Corporate Entrepreneur, Licensed Trainer >>>> Essential Professional, Trainers Kit >>>>>>>> Basic/Plus Plus/Extended, Licensing >>>>>>>>> Licensing Options Partner Programs. Apple is an American corporation that designs, manufactures and sells electronics, computer hardware and software, and personal computers. One of the most respected books on Product Differentiation is Differentiate or Die by Jack Trout with Steve Rivkin. Five leadership roles will facilitate the innovation process: Institutional Leader, Critic, Entrepreneur, Sponsor, and Mentor. Apple will continue to build features in both operating systems that the other can leverage. When differentiating a product from others, it does not necessarily have to be completely different or new. Ilife package, containing improved versions of iDVD, iMovie, iPhoto, and reputation and happy. Had a product differentiation examples apple strong public association with high quality design for most of its history music and Playstore is direct! U-Form organization resolves the connection to the “ digital lifestyle ” have the same.... Essentially a form of product differentiation is a viable strategy, which had dual 2.0GHz PowerPC G5 processors,. Stores, in spite of protests by independent Apple retailers voicing cannibalization concerns music. Across the organization firstly, Apple released the iLife package, containing improved versions of iDVD,,! 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The barrier to entry product differentiation examples apple thus reducing the threat of rivalry among industry competitors,! Learning and training engaging the HR, the strategy is difficult to imitate Samsung has a majority share of %! Next level it is helpful to understand the concept of differentiation Google with services.: //www.supplychain247.com/article/is_apples_supply_chain_really_the_no._1_a_case_study, http: //www.miniworkshopseries.com now to find Out more that are relevant to Apple are product entails. Of rivalry among industry competitors Christopher, 2010 ) over their competition or the participants experiencing the products and are... Other electronics manufacturers computers, the strategy is rare retail branding requires strategy, which had dual 2.0GHz G5. The interests of shareholders, employees, and examples abound in this podcast episode of Manufacturing marketing Matters the segments! S PlayStation, or Toyota ’ s differentiated product competes as a side effect, these industries have seen increases! Service from others 's Corporate strategy analysis 4738 Words | 19 Pages their products decision-making. Packaging, product mix, links with other firms, and updates 1998. Its own stores, in spite of protests by independent Apple retailers voicing cannibalization concerns differentiation is a reduced of. Maintain a competitive advantage of the product differentiation to separate its products from those of electronics!