The Competitive Forces Of Apple

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Apple, Google, and Microsoft each develop, design, and market a variety of software, services, and devices. In this technology market, these firms face aggressive competition in serving single customers and various small, medium, large companies. Within this segment, the competitive forces exert pressure, which influences strategy development and execution and a competitive advantage. As such, the competitive forces are the power of suppliers, power of buyers, threats of substitutes, threats of new entrants, and existing rivalries (Rothaermel, 2017). Concerning suppliers, Apple single-sourced outsourcing to supply hardware, Google used third-party supply sourcing, and Microsoft used a mixture of single-source and third-party (U.S.…show more content…
A global technology firms, the CPM revealed 12 critical success factors (CSF) in exploring the strengths and weaknesses of Apple, Google, and Microsoft. The CSFs are identified as financial position, profit margin, market competitiveness, brand reputation, brand awareness, product diversity, complementary products, research and development spending, innovative culture, service quality, customer loyalty, and e-commerce. The subjective measure CPM analysis produced the following average weighted scores: Apple 3.93, Google 3.91, and Microsoft 3.56. Extracted from 10k reports, Apple retained $20 billion in cash in 2016, whereas Google held $12.9 billion and Microsoft $6.5 billion (U.S. Securities and Exchange Commission, 2017A; U.S. Securities and Exchange Commission, 2017B; U.S. Securities and Exchange Commission, 2017C). In comparison, Apple’s large cash reserve suggested it had a more favorable financial position than Google and Microsoft. However, analysis of gross profit margins suggested Apple earned 33 cents per dollar of sales, while Google and Microsoft outperformed Apple, with each retaining 61 percent of sales. Nevertheless, all three firms received high marks regarding market competitiveness and brand awareness as each competitor is well funded, experienced, and established in technology markets. The comparative analysis suggested Apple and Google had superior performance regarding brand reputation; however,
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