Apple Inc, is incorporated in 3 January 1977 as a multinational corporation which serves as a manufacturer and designer in the consumer electronics sector. Their focus point is production, marketing and support service of personal computers, computer hardware and software portable mp3 players, portable video players and finally mobile phones with the multimedia function. The company is located in USA, California, Silicon Valley. Today the company has over 200 retail stores all around the world.
Retail stores consist of products such as computers, software, iPod music players, iPhone cell phones, third-party accessories, and other consumer electronics such as the Apple TV. This retail stores function as Studio for training with Apple products, and also all stores offer a Genius Bar for technical support and repairs, as well as free workshops available to the public. In Genius Bar, customers can receive technical advice or set up service and repair for their products. So retail stores provide simulation and repair services.
Current products of Apple Inc. is divided into two as hardware and software. For hardware segment Apple Macintosh family is the price premium products of Apple Inc with high qualified features and design. iMac, iBook, Macbook, iPod, iPhone are certain hardware products. From software side Apple develops its own operating system to run on Macs. iDVD, iMovie, iPhoto, iTunes, GarageBand, and iWeb are sofwares which are compatible with Macs. The customer target of Apple is generally consist of consumers who search for superior quality and sophisticated design. Before iPod and iPhone the consumer range of Apple is limited with Mac. users.
Their share in the market is very low because of the competition with Microsoft. The strategy of Microsoft interfere compatibility of software with other computers. Microsoft is providing practical and for everyday usage systems. Not much quality is concerned for Microsoft. So because of Microsoft monopoly in software systems Apple’s share is limited. Convincing an ordinary user switching to Apple system, quality but also price burden related to elegancy, is undoubtedly tough. Although Apple serves much more qualified products they are not preferred for regular usage. Apple accepted failure in computer market and search for another field to make a great impact.
After a well planned strategy iPod portable media players are introduced to market as the innovative product of Apple. iPod first entered to market in 2001 with a great impact. The reason for involvement for this new product is based on it’s elegant design and compatibility with legal mp3 downloading system iTunes. Unquestionably there were existing digital music players. But the main problem with existing products is the memory limitations and design. With iPods circular console works through touchpad logic. In addition with color and size choices iPod provide variety. iPod can play MP3, AAC/M4A, Protected AAC, AIFF, WAV, Audible audiobook, and Apple Lossless audio file formats.
The iPod photo introduced the ability to display JPEG, BMP, GIF, TIFF, and PNG image file formats. The target market of iPod is namely young generation. Because iPod is a product which is practical, directly related with technology and reflecting lifestyle preferences. iPod is seen as the product which give rise to entry of Windows users to the Apple way of life. The most essential reason for iPod being so successful is iPod and iTunes compatibility. iTunes is a program which allows songs to be played on the iPods using company’s Fairplay Digital Rights Management system.
This program allows users to do legal downloading. A standard digital format such can not be played on iPod. Users should use iTunes software to be able to download songs. So iTunes make encryption for audio files to make it compatible with iPod. Once you purchase an iPod you won’t be able to download illegal music and use it in iPod. This complementary system protects the music sector and illegal actions. In 2006 iTunes had 72% of online music business. iPod is recognized as one of the simplest most elegant music listening devices ever created.
By player and proprietary download software system they create customer loyalty. Being the first mover to a market is very important. iPod used this opportunity and eliminate threats to rivalry entries to market. Because Apple started this business long time ago from it’s competitors. When then they entered to the market with complacency their competitors tried to replicability and imitability of their strategy. But as the number of iPod/iTune users continued to grow Apple’s dominance of the legal music industry become irrepressible.
Music producers were willing to sign agreements with Apple to let them distribute their music through iTunes. Several firms are trying to catch iTunes. For instance Yahoo! Music and Napster do copy protect for their downloads. But they use a software provided by Microsoft that is incompatible with iPod. So these efforts become useless against iPod monopoly. One of the competitors of iPod is Zune player which is supported by Microsoft software. They directly imitate iPod/iTune strategy but results were disappointing. Because iPods have already become a part of life. Once you have an iPod you don’t shift to another brand.
In addition this is a long term product that you can you as long as its memory is adequate to your demand. While competitors of iPod fight for a position in the market Apple make innovative products everyday and introduce new models such as iPod Nano, iPod shuffle. Discoursing to every kind of demand with price, memory and size choices iPod seem to protect its dominant place in this sector. Apple’s last innovation was on mobile phones. iPhone is a revolutionary phone which allows you to make a call by a simply tapping a name or number in your address book, it syncs all your contacts from PC, Mac or internet service.
In addition it is a widescreen of iPod with touch control on a 3.5 inc display. It allows you sync with iTunes and features a rich HTML email client. In consequence iPod has entered to market with right strategy in the right time. Before it’s competitors imitate the technology and system they procure product loyalty and this turns with barriers to entry against competitors. Apple take revenge of defeat in computer sector by utilizing Microsoft’s compatibility strategy in iPod.