Executive summary
The purpose of this paper is to compare the marketing approach of two software companies, Apple and Microsoft. The psychological perception of a firm is a very vital aspect that analysts often overlook and this perception has affected the market status of the two companies. Microsoft is an old static jumbo that is representative of the status quo because it is no longer dynamic and its past market success has motivated it to approach the market with untold arrogance. However, Apple is a recent agile and dynamic company with high levels of creativity and innovativeness and it has a very friendly approach in the market (Blaxill, 2009).
Background
Apple is a very successful company with two of its products; the iPod music player and Macintosh computers enjoying significant popularity in the market. Notebooks have also brought significant income for this technological company because they have a favourable brand perception (Rose, 1999). Microsoft is a software manufacturing company that is well known for its rapid development of products which include the Microsoft Office suite and its products are widely used around the world by businesses and the general community (Leroy, 2001). The success of these two companies has been brought about by branding. Apple and Microsoft are the healthiest IT brands in the world and they have a very loyal customer base who has been strong advocates of the brand. This means that the two companies can attract and retain customers. However, a look at the stock market indicates that the apple shares have been going up considerably while Microsoft’s have been stagnant and at some point, they had started going down. To understand the market dynamics, it is important to look at some important factors in the environment the two companies operate. The following is a SWOT analysis of the two companies
SWOT analysis: Apple
Strengths
- Favourable brand perception
- Loyal customer base
- Innovativeness and uniqueness of products
Weaknesses
- The company has a history of manufacturing faulty products
- Changing from IBM to Intel chips confused its customers
- The high price of its products
Opportunities
- The new technology provides ample opportunities for apple; for example, it has the opportunity to transform iTunes to mobile phone format
- The company can generate a lot of revenue from podcasts
Threats
- Competition from new entrants
- Dynamic technology in the fast IT industry where products are being replaced by new ones at a fast rate
- Vulnerability to leaks.
SWOT Analysis: Microsoft
Strengths
- Rapid product development processes have seen the company release new products to the market faster than the competition.
- The brand reputation which creates a competitive advantage
- Controls the market with more than 88 per cent share of the market
Weaknesses
- Pre-installation of Operating systems
- High employees turn over due to burnout
- The bureaucratic and autocratic atmosphere which hinder innovativeness
- Single focus products
Opportunities
- Popularity with the internet users
- Increased demand for the products despite the growth of hand devices.
- Opportunities for strategic alliances with mobile phone companies
Threats
- Competition from Apple and Linux
- Global economic patterns and fluctuating exchange rates
- Availability of substitutes from hardware manufactures that reduce the value of windows.
- Availability of mobile phones and handheld devices that do not require Microsoft’s operating systems
- Numerous suits filed against the company by consumers and employees affect its reputation.
References
Blaxill, M.(2009). The Invisible Edge: Taking Your Strategy to the Next Level Using Intellectual Property.CA: Portfolio.
Leroy, A. (2001). A History of the Personal Computer. NY: Allan Publishing.
Rose, F. (1999). West of Eden: The End of Innocence at Apple Computer. WA: Penguin Books.