In the second quarter of 2020, Apple was the third-largest smartphone seller in the world, with 13.5% of the global smartphone market, slightly above the first quarter. Today, Apple is a follower, not a leader in this market. The company follows a strategy of anticipating customer needs and wants and producing high quality products to meet them. He stays close to customers and provides useful and fun products and services to customers.
Apple’s smartphone strategy
Steve Jobs’ Apple produced the Macintosh computer in 1984 for the use of normal people, not experts. Apple later ousted Jobs and developed the Newton in 1993, an extraordinary PDA ahead of its time. I have two working Newtons, which could have heralded the iPad years earlier if this continued.
When Jobs returned to Apple, he cut many irrelevant products, focused on Apple, and began Apple’s renaissance with the iPod in 2001. And in one of the biggest product introductions of all time, Steve Jobs launched the iPhone at Macworld on January 9, 2007.
Then came the iPad in 2010, and perhaps the biggest addition to the health device market, the Apple Watch in 2014. Meanwhile, Apple continues to launch laptops, desktops and is working on an autonomous car.
True, Apple was previously a leader in the smartphone market. The early days of the iPhone were so effective, Blackberry (former Search in motion) did not recognize the power of the iPhone and later Blackberry went bankrupt after dominating the smartphone market.
Where are we today? Apple is a fan of the smartphone market, a strategy it seems to have adopted. This approach seems to work. While he is making huge gains with his services, smartwatch, and other products, the iPhone will be a staple of his business for a while. So what does it need to do to stay competitive in the fiercely competitive smartphone market?
Stand out in the smartphone market
- Stay close to customers and am not Samsung or other leaders. Apple must to anticipate the needs and wants of customers and provide them with products to meet them. Following Samsung or other smartphone leaders would mean Apple would use their assumptions and market information, which may or may not be good in the long run. Strategy is about choices: what to do and what not to do. Apple must choose the markets in which it will enter and the markets in which it will exist, always with a long-term perspective.
- Provide superior customer service, but put employees before customers. Train employees, empower them, avoid bureaucracy, treat them well and fairly. Adopt South West and FedEx “ approach: Employees first, customers second, shareholders third. When we treat employees well, employees will provide exemplary service to customers. It’s all about customers!
- Stay in the basic skills and concentrate the company’s resources in these areas of expertise. Is the adventure in the self-driving car market a distraction? Prior to Steve Jobs’ return in 1997, Apple diversified into many areas and nearly went bankrupt. Steve has refocused activities on a few products in his areas of expertise. With so much money at its disposal, that could cause Apple to stray from its skills. Money should never drive decisions! Money is the source of funding for decisions, nothing more. This is a crucial consideration for companies like Apple, with a glut of cash. Apple should not diversify because it “can” and distract from its skills. It must diversify because it “should”.
The smartphone has become a commodity and creating a niche market will be difficult. Pursue a the product differentiation strategy is the only feasible approach to stay competitive. Having a faster iPhone that takes better photos isn’t going to be enough. Apple needs to transform the iPhone to perform functions that we cannot imagine today, otherwise an unmarked iPhone will become a lower margin product and declining market share along with other smartphones.