Apple was inaugurated on April 1, 1976 in Cupertino, California. It was incorporated on January 3, 1977. For the first 30 years of its existence, the company was called Apple Computer, Inc. However, on January 9, 2007 the word ‘Computer’ was removed in order to encompass the company’s growth in the consumer electronics market as it expanded its production to a variety of products apart from its traditional product i.e. personal computers. Today, Apple is known as an American multinational corporation that manufactures and sells computer software and hardware and consumer electronics.
Apple had 2,500 temporary full time employees and 34,300 full time employees worldwide, in September 26, 2009 and worldwide annual sales of $42.91 billion for the fiscal year 2009.
The company’s corporate headquarters are in the middle of Silicon Valley at 1 Infinite Loop, Cupertino, California. This real estate was built in 1993 by Sobrato Development Cos and consists of six buildings that cover an area of 850,000 square feet (79,000 m2). The corporation operates a total of 284 retail stores across ten countries.
It has an online store where it markets its software and hardware products. In terms of revenue, Apple Inc. is one of the largest technological corporations and one of the most valuable tech companies globally (Cruikshank).
High technology products
The company’s most popular hardware products are iPad, iPhone, iPod and Macintosh computers. It’s software products include the Mac OS X which is an operating system, iTunes which is a media browser, iLife suite which is a creativity and multimedia software, iWork suite which is a productivity software, Aperture which is a professional photography package, Final Cut Studio which is a suite of software products for professional audio and film-industry and Logic Studio which is a suite of audio tools.
Apple has been involved in vertical integration in their products. They manufacture the hardware on which they pre-install their software. In the early years, Apple resisted adopting the established industry standards for hardware and relied on creating its own standards. FireWire is an example that has received widespread industry approval and has been adopted on a large scale after it was standardized as IEEE 1394. However, in the late 1990s, Apple broke its trend of refusing to adopt industry standards when it adopted PCI bus in the 7500/8500/9500 Power Macs. Since then it has adopted Wi-Fi, USB, Hyper Transport, AGP, and other standards in its computers. In some cases, it was the leader in the adoption of industry standards for example, the USB. Apple has been in the practice of selling third party accessories ever since the first Apple Store opened. This allows other tech companies to sell products that are compatible with Apple’s products. For example, Canon and Nikon sell their Mac-compatible digital cameras and camcorders inside the store. Adobe is one of Apple’s oldest software partners and it also sells its Mac-compatible software. Similarly Microsoft sells Microsoft Office for the Mac.
Apple is one of many highly successful companies of the 1970s that changed the traditional concept of corporate culture especially in terms of organizational hierarchy. Even after Apple became a Fortune 500 company, its founder, Steve Jobs often walked around the office barefoot. In “1984” when the TV ad was released, this attribute became the key way in which the company was differentiated from its competitors.
With the growth of the company under a series of chief executives, some of its original personality has been distorted. Nevertheless, Apple maintains a reputation for nurturing excellence and individuality which attracts talented people into becoming a part of the organization in form of its employees. Apple greatly values its employees. It introduced the Apple Fellows program to recognize the contributions of its employees. According to the program Apple Fellows are those employees who have made exemplary contributions of technical or leadership nature to personal computing. So far Apple Fellowship has been awarded to Bill Atkinson, Steve Capps, Rod Holt, Alan Kay, Guy Kawasaki, Al Alcorn, Don Norman, Rich Page, and Steve Wozniak.
At Apple Inc. they are very smart with their R;D and its budgeting. The company innovates beyond imagination. It enters a market, takes it over, and raises the bar. Apple’s operating income increased from 1 million dollars in 2003 to 4409 million dollars in 2007 which is an increase of 881% a year for the 5 years. Surprisingly, the R;D that has turned the world upside down is tiny compared to the operating income. Apple’s R&D is 34% of operating income. From 2003 to 2007, Apple spent 2991 million dollars on R&D even though it had an operating income of 8818 million (Gibson). Apple spends less than 4% on R&D. The amount of R&D spent by Apple in its physical (non-software) products is about $78.5 million per product (Jade). It might appear that Apple cuts down on its R&D. However, that is not the case as over the last decade, Apple’s R;D has grown the most (nearly quadrupled) in terms of percentage growth.
Apple does not do market research. It ridicules the concept of target markets and doesn’t conduct focus group researches. Instead, Apple practices the strategy of hiring really smart people and letting them loose while overlooking them and their work with an extremely demanding eye. In a recent interview, Jonathan I’ve explained that Apple’s main goal is to make great products and not money. In other words Apple believes in the concept that if they make the very best products, business will follow.
Apple enjoys a unique reputation among the consumers of the electronics industry. It has a highly devoted customer base especially in the United States. Apple was named the most admired company in the world by Fortune magazine in 2010. Apple has the highest repurchase and brand loyalty, according to surveys by J. D. Power. Although this brand loyalty is unusual for any product, there is no evidence that Apple has gone out of its way to create it. Apple Store openings attract huge crowds. Some people wait in line a day before the opening and some fly in from all over the world to watch the opening ceremony. According to market research, Apple’s customers are unique. Its customer base is composed of extraordinarily creative, artistic, and educated individuals who are sociologically elite and seek simple, elegant computing. Apple’s users exhibit a unique profile with reference to the ways in which they use their personal computers. This profile is characterized by individuals who are early adopters, exploratory, avant-garde and active. Their activities are centered on rich media such as music and video.
Apple’s efforts in effective and efficient advertising and marketing of its products have been acknowledged since the beginning. From the launch of Macintosh in 1984 advertised in the Super Bowl commercial to the new adverts of ‘Get a Mac’, Apple’s advertisements have played a vital role in product promotion (D. O’Grady).
Apple’s first logo was designed by Jobs and Wayne. It shows Sir Isaac Newton sitting under an apple tree. It was replaced by a rainbow-colored outline of an apple with a bite taken out of it, created by Rob Janoff’s. The logic behind the bite was to ensure that the logo is seen as an apple and not as a cherry. The colored stripes served two functions; to make the logo more accessible and to show that the monitor is colored. In 1998, the rainbow theme was replaced by monochromatic themes. The Aqua theme was used from 2001 to 2003 and a glass theme was used from 2003 onwards.
Apple’s first slogan was made in the late 1970s and read ‘Byte into an Apple’. Later on, during the years 1997 to 2002, the slogan was Think Different. This slogan had a deep impact on Apple’s image and increased its popularity among customers and the media. Although this slogan is not used anymore, it is still closely associated with Apple.
Apple’s commercials are famous for introducing musicians and leading them to stardom because of their eye-catching graphics and attractive tunes.
In the Apple deathwatch for the press, Apple announced that it would be starting the sale of Macintoshes on the Internet. The Apple Online Store is one of the best sites according to website experts (Hust). The web pages have only those graphics and buttons that are required for the purchasing process. The simplicity of the Apple Online Store has made online shopping an extremely convenient experience for the customers and contributes to its profitability.
Cruikshank, Jeffrey L. “The Apple Way”. December 19, 2005. Hardcover.
D. O’Grady, Jason. “Apple Inc. (Corporations That Changed the World)”. 2008.
Gibson, Brad. “Apple Ranks 91st in U.S. R&D Spending at $471M”. The Mac Observer. 30th
Hurst, Mark. “In Search of E-Commerce”. 2nd edition. February 1999. Report.
Jade, Kasper. “Morgan Stanley advises investors not to bet against Apple”. Apple Insider.
Friday, 25th January, 2008. Published Online.