Our Apple SWOT analysis examines the Strengths, Weaknesses, Opportunities and Threats of the largest tech company of the world.
If you are reading this article, there is a big chance you're reading it on an Apple device. Apple has now become a household name; there will be hardly any house that doesn't have an Apple device. This Apple SWOT analysis will help us determine what makes Apple such a big name in the tech industry. It will do so by presenting Apple's Strengths, Weaknesses, Opportunities and Threats.
Apple Overview
It has almost been 21 years since the very first iPod was launched. Some of you reading this can actually relate to how a person owning an iPod was treated like a big deal back in the old days. Even now, after Apple's mobile phones and Macbooks are pretty common, many people use them as a status symbol.
No one would have ever thought that a company that was founded in a garage back in 1976 would be considered the largest tech company in terms of market cap. Apple mainly focused on producing computers and computer-related accessories in its initial days. Still, later in the 2000s, they diversified their products and came up with iPods, iBook, Mp3 players, and iPhones which acted as a turning point for Apple.
Apple now operates globally with a market cap of $2.65 trillion [2024]. In order to understand this success story in a much better way, we conduct this SWOT analysis.
With that in mind, today’s SWOT analysis of Apple will:
- start with the strengths that underscore Apple's dominance in the electronics market
- move to the weaknesses that present hurdles to its growth
- discuss the opportunities that the electronics and computing world offers, and
- reveal the threats in an industry known for its fierce competitiveness and innovation
By examining these influences, we will also investigate what’s achievable in the spheres of computing and communications technology. In the meantime, check everything you need to know about SWOT here.
Apple Strengths
In this section, we will discuss the factors that helped Apple become a tech giant. Strengths are the factors due to which companies grow and capture their market share. Following we have discussed some of the key strengths of Apple, which helped Apple in becoming one of the largest tech companies.
Huge Market Share
For any company, the number of actual and potential buyers matters. In terms of Apple, it has a huge market. It was recorded that more than 1.8 billion Apple devices were in use in 2022. The number increased to 2.2 billion in 2024.
Technologically Advanced
Apple has always been ahead of its competitors in terms of technology. Features like Airdrop and Siri are only two of the most prominent ones that have always attracted buyers.
If we recall, the concept of a good quality camera in a mobile phone was initiated by Apple and later adopted by its competitors. Such advancements in technology have always given Apple an edge over its competitors.
Diverse Product Range
Diversification is essential for any company to grow by filling the market gap. Over the years, Apple has worked on its product range.
Although initially, its products were very specific and only computer-related, later, it diversified its product range by including iPods, iPhones, Macbooks, Desktops, Smartwatches, and much more. Besides smart devices, Apple also has an extensive product range of electronic accessories such as wireless headphones, Airtags , iPhone cases, etc.
Increase in Apple Services
Apple has put its focus on enhancing its services. In the first quarter of 2022, Apple generated almost 19 percent of its revenue by providing its services.
This thick contribution of services to the annual revenue was only possible because Apple launched many services in the recent past that millions of people availed of, such as AppleCare, Apple Card, Apple TV+, etc.
Design and quality
Apple is known for its innovative product designs that are simple yet classy. If we look at the example of an iPhone, It always has such a simple structure with no make-over, but they always carry that grace. And have become an epitome of status and class.
Quality is one thing that many people are not willing to compromise on, and Apple knows how to satisfy its users in terms of quality.
Apple makes sure that they produce a high-quality product using modern and innovative techniques. This is why you will never see an Apple user complaining about its quality. For that very reason, there are many apple service programs to ensure high quality and customer satisfaction.
Customer loyalty
Any company which has a loyal customer base is considered very lucky.
Unfortunately, Apple is one of those companies which has loyal customers. As a result, Apple users are often labeled with "Once an Apple user, Always an Apple user" which is correct in most cases.
There are many reasons why Apple users are loyal to their brand, but one of the primary reasons Apple users don't switch from this brand is that Apple provides privacy features to a great extent, making its users feel more secure.
Apple Weaknesses
No company is perfect; even the most successful companies run on a mix of strengths and weaknesses. Even after having all the strengths that we have discussed earlier, like any other company Apple also has some weaknesses.
Not enough digital advertising and marketing
Unlike most top brands and companies, Apple spends much less on its digital advertising. If you give it a thought, you'd be shocked to realize that there are almost no Tv advertisements, social media advertisements of Apple compared to other brands such as Samsung and Pepsi, yet they manage to achieve record sales each year.
In 2019 Apple’s digital advertisement expenditure decreased up to 68% compared to the digital advertisement expenditure In 2018.
Imagine If they were adequately doing marketing their products through digital and social media, they could generate more revenue.
Limited designs in phones
If we recall the design of the very first iPhone and iPhone 8, there was hardly any difference in its appearance except for size and thickness. They were simple-looking round-edged phones with a home button placed in the center.
Although Apple upgrades each model of their iPhone by adding new features to them, many iPhone users have a problem with the lack of variety when it comes to the design of the iPhone.
High prices of products
Apple products may be the best in the market, but not everyone can afford them. Prices set by Apple are very much inflated, due to which many potential costumes switch to its substitutes.
Allegations of tracking the exact location of users
Apple was accused of revealing the exact location of its users with the help of its tracking mechanisms. Although it was never proved that Apple was misusing the information of its users, to counter this allegation, Apple introduced an option for its users to keep their location private.
This allegation brought bad publicity to the company and made it difficult for the users to trust Apple again.
Products only compatible with Apple's software
Whenever people buy an Apple device, they have to make their Apple id. Once that id is made, their device will only work through that Apple id.
Apple products are not compatible with any other software, which inconveniences the users.
Reliance on iPhone
The majority of the revenue earned by Apple is through the sales of the iPhone. Although Apple has worked on diversifying products, it still heavily relies on the iPhone for revenue generation.
This reliance can result in serious trouble for Apple if people stop buying iPhones for some reason.
Apple Opportunities
Any company needs to avail of the opportunities present today to benefit from them in the future. Therefore, gaining benefits from external factors can help Apple grow in the future.
Development of AI
As the world is experiencing a new wave of artificial intelligence, Apple can benefit from the recent developments in artificial intelligence to make its products more user-friendly. Though there are many advancements made in this avenue, still there's a lot to do.
In 2024, Apple's expansion to the AI market shows the potential to lead in AI-driven consumer products.
Production of eco-friendly products
Global warming and climate change are the top two most significant challenges faced by the world currently, and a lot of work is being done to mitigate them.
The production of eco-friendly products will not only benefit the environment. Still, it will portray a positive image of the company, which can help in increasing the sales of Apple products in the future.
Use of virtual reality
Although virtual reality is usually associated with entertainment purposes, Apple can use virtual reality for its marketing purposes. For example, Apple can hold its events virtually to get people more involved.
Dependence on technology
Over the years, the reliance on technology has increased across the globe. As a result, the number of people using smart devices increases day by day, providing Apple with an excellent opportunity to increase its market share by expanding its customer base.
Globalization
The world has now transformed into a global village. Globalization and improved means of communication and transportation enable customers to purchase and receive products directly from reputable companies concisely. This provides an opportunity for Apple to make customers across the globe and increase their revenue.
Apple Threats
Threats always make companies worry about their future. Any company should take no threat lightly, and they should do work to overcome these threats. Unfortunately, Apple also faces several threats that make its future uncertain.
Russia-Ukraine War
The war between Russia and Ukraine is negatively impacting many companies across the globe. Similarly, Apple will also incur economic losses after abandoning its operations in Russia.
Tariffs imposed by the US on China
The US has imposed high tariffs on China, due to which the cost of imports from China has increased. This will increase Apple's production cost, increasing the prices of its products.
Competition
Increasing competition is a worry for Apple as companies like Google, Huawei, and Samsung give Apple a tough time with their upcoming technologically advanced products. Therefore, Apple has to strive hard to remain the market leader in this challenging scenario.
Technological change
The world is experiencing technological change rapidly due to which existing technology gets outdated very quickly. Therefore, to maintain its position in the market and stay relevant, Apple has to adopt new trends and technology.
Outburst of Covid-19
Due to the Coronavirus outbreak in China, Apple faced significant disruption in its supply chain. As a result, Apple had to bear heavy losses. One of the immediate losses which were incurred by Apple was the loss of $100 bn In the stock value due to the late launch of the iPhone.
Although currently, the situation seems in control, you never know. An increase in the Covid cases in China can result in lockdowns again, making Apple suffer financially.
Recommendations based on Apple's SWOT Analysis
This SWOT analysis provides a clear picture of the strengths and weaknesses of Apple and what threats it has to face. Meanwhile, it also tells us about the present opportunities for Apple to avail today for a better tomorrow.
According to this SWOT analysis, Apple is in a reasonably good position since the strengths and opportunities outweigh the weaknesses and threats that the company faces.
After reading this article, now you know about Apple's strengths, weaknesses, threats, and opportunities, and you also know how to do a SWOT analysis. However, this SWOT analysis is very informative but, at the same time, a little time-consuming. This SWOT analysis can also be summarised in tabular form if you are looking for it.
So with Apple, let's think differently!
