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Apple Inc. In 2015 Case Solution

Solution Id Length Case Author Case Publisher
1518 1521 Words (6 Pages) David B. Yoffie, Eric Baldwin Harvard Business School : 715456
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The Apple watch, regardless of the media glamor attached with it, cannot be at par with the iPhone. The primary reason for this is that even though Apple claims it to be an innovative product, it is not a breakthrough. The product is not also an innovation completely in itself – at the global or the local level. This is because a smartphone watch was already present in the market. Apple just adapted the product to its iPhone and improved it. The concept of the product may not be called innovative, but the improvement of features and applications present in the watch may then be termed innovative. Despite this, the Apple watch cannot be termed at par with the Apple iPhone. The Apple iPhone was a break through, and a standalone product. It redefined the smartphone category and created a lifestyle brand. The Apple watch, instead, depends on the Apple iPhone, and cannot operate without it. The innovation, if it may be called so, is an extension of the greater Apple iPhone –which will always overshadow it. On its own, the product is not attractive or lucrative for buyers. It lacks the product differentiation that is present in other Apple products such as the iPod and the iPhone, most notably.

Following questions are answered in this case study solution

  1. Apple Watch vs. Apple iPhone

  2. Advice for Tim Cook

  3. 3 Possible Courses of Action to Maximize Stakeholder Growth

  4. Recommendation

  5. Appendix

Case Analysis for Apple Inc. In 2015

As such, the launch of the Apple Watch may not be termed as a good idea overall. This is because of lack of differentiation in the product itself as well as the dependence of the device on the original iPhone. If a person wants to use the Apple watch, he will have to buy the iPhone. The dependence of the new product on a previous product appears to give it a piggy-back-ride image. Moreover, the presence of other players in the wearable watch category for smartphones gives Apple a late entrant looks who has become a follower rather than a trailblazer.

2. Advice for Tim Cook

Tim Cook is advised to showcase the differentiating factors of the iWatch in the marketing strategy of the product. This will be critical in not only extending the product to the benefit of the iPhone's lifestyle brand image but will also act to justify the price of the iWatch. More so, Tim Cook should focus on the company’s roots. Instead of moving to middle markets to compete directly with players like Samsung, he should focus on the Apple community and the targeted market that it had initially focused on for the iWatch as well.

By focusing attention on the media and marketing strategy, Tim Cook will be able to generate interest in the wearable watch category for smartphones. Though other players had tried to tap into this market and category, they had failed to generate consumer interest because of lack of strong brand following and brand community as well as the lack of strong customer loyalty. Apple has a community that follows the brand – which has become an icon as well as a lifestyle. Tim Cook should take advantage of this fact, and should generate media hype about the Apple watch. This will give the Apple Watch reasonable coverage as well as associate it with the popular iPhone. His iPhone users will automatically feel drawn to the product, and will want to own it. However, a drawback of his is that it may increase competitors share as well. The media hype and marketing strategy that Apple will use will enhance the overall smartphone category. As a result, competitors will also push forward their smart watches for their brands of smartphones. 

In order to satisfy his stakeholders, the following three courses of action are suggested for Tim Cook, which are aimed to enhance and increase stakeholder value.

3. 3 Possible Courses of Action to Maximize Stakeholder Growth

Focus on Marketing

One option for Tim Cook is to focus on the strategic marketing activities of the company. Under this option, Tim Cook will be introducing new product based on the old ones. For example, a new model of the iPhone, or the iPod, etc. there will be no new product development in itself but only continued innovations in the existing products, these innovations will be showcased and launched in a strategically attractive manner which will aim to influence consumers. Tim Cook will focus on building a stringer media presence, reaching out to increased customer groups and market existing products more exclusively and strategically. This option will maximize shareholder value by attracting larger audiences, and giving room to higher profit margins for Apple itself.

Focus on Innovation

Continuing the Apple legacy: under his option, m Cook will continue to encourage new product development and innovation. Innovation, then, will not mean adding new features to an existing product but rather would mean creating a new breakthrough product in itself, and then improving it. For example, the iPod, the iPad, the iPhone were innovations. Apple is a company that has had innovation in its DNA. Under this option, Tim Cook will have to focus on pushing the company to give new breakthrough products to consumers and regain its lost image of a leading innovative company. These innovative products must be standalone – unlike the Apple iWatch which is dependent on the Apple iPhone. Though they may share common softwares such as the iTunes store, they should be functional in themselves without external dependency on other Apple products.

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