Free Essay On Strategic Initiative

Finance

Based in Cupertino, California, Apple Inc. designs, manufactures and markets ‘mobile communication devices, personal computers, digital music players and related software’ (Nielson, 2014). Apple’s business strategy is closely linked to its financial planning; one aspect cannot exist apart from the other.
Apple’s business strategy is built around Apple’s ability to uniquely design and develop its own operating systems, hardware and software (Apple, 2014). Apple has created a niche in the market on the basis of its design aesthetics, easy to use products and product reliability; all of which are promoted to customers through unique advertising, a high-quality buying experience and comprehensive after-sales support (Nielson, 2014).
In the words of Steve Jobs, Apple is a company that is ‘based on innovation’ (Nielson, 2014). Apple’s strategy is built around four pillars: ‘offer a small number of products’, ‘focus on the high end’, give priority to profits over market share’ and ‘create a halo effect that makes people starve for Apple products’ (Nielson, 2014).
Thus, Apple strives to carry to forward thinking research and development to create desirable products. The money spent on research and development result in products becoming higher priced. Apple does not try to cut costs to compete on the price front. Rather, its financial strategy, in sync with the business strategy, is to market its products as costly and desirable.
Apple’s pricing strategy helps in ensuring that its resellers do not compete against one another to undercut the price of Apple products. Thus, the financial strategy ensures that Apple products retain their premium niche due to higher pricing, which in turn is in sync with the business strategy of providing high quality products.

References

Apple. (2014). Form 10-K 2014. Retrieved March 22, 2015, from http://investor.apple.com/secfiling.cfm?filingid=1193125-14-383437&cik=
Nielson, S. (2014). Must-know: An investor’s essential guide to Apple. Retrieved March 22, 2015, from http://marketrealist.com/2014/01/apple/