Current Market Position of iCloud - Case Study Example

Corporate Environment Introduction Multiple changes in technology have made the internet a ‘market’ place. Technological companies such as Apple and Google have launched online products such as iTunes among others. Over the years, these products have undergone changes in a bid to ensure they serve consumers well. Apple has now transformed their Mac online service to iCloud. iCloud is a new ‘cloud’ browsing application developed by apple, the application allows users to download, upload and save personal files in a space available on his/her account. This follows other inventions such as the iPod and other lucrative products apple has been able to manufacture over the years. iCLoud comes after a series of attacks on personal and company information over the years, for example the hacking of IMF. iCloud provides consumers with high level security and safety of data. This new product gives online users to download, upload and save media files on their respective accounts. Each account is allocated 5GB of memory where individuals can store their files. These new products have constantly attracted attention from individuals and other organizations. These groups are arguing for improved regulations governing the usage of these services. They argue that consumers need to be protected from such products when it comes to issues of security and privacy. Apart from social barriers, iCloud is facing stiff competition form new products from Google. Apart from technological companies, iCloud will have to ‘fight’ its way into the market by gaining a competitive advantage over traditional media companies. The main aim of this paper is to analyze the current market position of iCloud and how it can gain competitive advantage over traditional media companies. Before determining this, the paper will first carry out a competitor analysis to establish the current position of its chief competitors and their technological ability to come up with better and substitute products (Craig & Benson 2007, p. 38). A Potter’s five analysis of I cloud shows that the current competition is extremely high and switching the consumer group will be more tiresome and expensive than trying to attain a competitive advantage in the current market. At the moment the buyer power can be termed as extremely high since the consumer has the ability to choose between traditional storage methods and the use of iCloud. This means that the company needs to put the product in check in such a way that consumers will always be satisfied with it. When it comes to supplier power, the control over prices and competition is extremely low. In recent years, the security of information stored in traditional media has been under constant threat. At the same time, the information stored was faced inconsistencies. However, the use of online services such as iCloud ensures that such information is secure and stays consistent at all times. On the other hand, the use of traditional media can be termed as ‘inconvenient’ this is because individuals had to carry storage devices from home to work and back or at times one could only complete a particular task at the office (Peteraf & Barney 2003, p. 49). However, the use of iCloud makes it possible for one to work on files at any particular location without having to carry them around. This is because one simply ‘walks’ with his/her iCloud account password and user name and password since they are all it takes for one to access his files (Panzarino & Mathew 2011, p. 8). This is a clear indication that iCloud is a better option for employees and organizations other than traditional medias. However, it will be difficult for consumers to shift and embrace iCloud if they do not have enough information about the product (Metayer 1999, p. 32). In order to gain competitive advantage over traditional media companies, Apple will have to ensure that consumers and other stakeholders have enough information about the product and its benefits (Craig & Benson 2007, p. 38). This will help them establish the difference between iCloud and traditional media. After this analysis then they will be able to make a choice on the best option (Panzarino & Mathew 2011, p. 8). Erik Erikson came up with a development theory that tries to explain the various stages that an individual goes through before death. In each of these stages an individual has two options. The first stage is where a child either develops trust or mistrust for the environment he/she lives in. in a business environment, a company will come up with new products then market them to consumers in order to make sales (Peteraf & Barney 2003, p. 49). In this case, the consumer will be introduced to a new environment just like the child is introduced to the world for the first time (Craig & Benson 2007, p. 38). Once the consumer has tasted the product then he/she will either be pleased or not be pleased with the way the service or product is delivered. Before the introduction of new technology, most individuals had dwelt on traditional media. However, in recent times there have been multiple changes in technology and individuals have been introduced to new and better commodities (Lee 2011, p. 5). For example, the introduction of iCloud has really provided stiff competition to traditional media companies. However, some of the consumers still have complete trust for brands offered by traditional media companies. it is therefore the responsibility of Apple to ensure that iCloud is well positioned in the market for them to win consumer’s trust. According to the theory of cognitive styles, different individuals have different ways of doing things (Craig & Benson 2007, p. 38). The theory focuses on the way different regions carry out their political campaigns and the government structure. A product should therefore be crafted in such a way that it is able to address the different needs from the different consumer groups (Peteraf & Barney 2003, p. 49). Apple should try to ensure that different consumers from different regions are developed in line with the people’s culture and way of doing things (Lee 2011, p. 5). This will play a central role in ensuring the company gains a competitive advantage over traditional media companies (Panzarino & Mathew 2011, p. 8). A competitive array of the industry shows that iCloud could face competition from products developed by major companies such as yahoo, Google and Microsoft. This is because they have the technology and ability to develop products of such quality. iCloud provides users with the ability to download music and even save the same in their individual accounts. On the other hand, Gmail allows users to save data in their email accounts while Microsoft has the Sky drive feature that6 allows consumers to also save data in their email accounts (Craig & Benson 2007, p. 38). This is a clear indication that the industry is full of competition and Apple will have to ensure they stay on top if they have to maintain their current consumer base. Google also continues to unveil new online products that are likely to increase the pressure and competition that iCloud is facing at the moment (Lee 2011, p. 5). It is not only important to note that there are major companies that are battling for a market share with Apple but to understand that they have the ability to design products f the same nature. Apple should therefore work hard to ensure that its consumers are satisfied in order to prevent them from looking for substitutes or shifting to other commodities. However, when we talk of traditional media companies, they have minimum competitive tools over Apple (Panzarino & Mathew 2011, p. 8). Therefore Apple should look to advertise where traditional companies do not have the ability to market their commodities (Craig & Benson 2007, p. 38). However, traditional media companies had already established their brand in the market. This is likely to make it difficult for apple to penetrate the markets which have been fully occupied by these companies. This will mean that iCloud will have to fight hard enough to attain consumer trust and loyalty (Metayer 1999, p. 32). Despite the fact that the use of internet has now spread to a huge part of the world, there are certain areas which have not fully joined the ‘global village’. In South America, there are communities which do not have complete access to internet facilities and if they do they have minimum. Such individuals prefer traditional Medias other than the use of online products such as iCloud. Apple should ensure that such people have information of this new product and its benefits. This cannot be done through online marketing alone; the company can come up with events that will assist them market the commodities in such areas (Craig & Benson 2007, p. 38). This can be done through corporate social responsibility programs aimed at empowering individuals in these areas. Through these initiatives, the company can help individuals understand what iCloud is and how it can be used. Given the fast spread of internet usage, these areas will soon have access to online sources hence the ability to shift with ease to access products such as iCloud (Panzarino & Mathew 2011, p. 8). It is important to consider the fact that these individuals are always attached to their culture and whatever activities carried out in the areas should be cultural sensitive. Apart from traditional companies, Apple is facing stiff competition from leading technological companies such as Microsoft, Google, yahoo and upcoming organizations. However, iCloud is somehow a different product from what these companies offer and therefore Apple will be looking forward to fight its way past traditional media companies to acquire a huge percentage of the market. Both Apple and its major competitors have massive marketing potential and are popular around the world (Lee 2011, p. 5). For example, Google is known to be the best search engine around the globe. On the other hand, apple is recognized as the leading technological company in the world. This shows that both companies are known to all internet and computer users. At the same time, both companies have great online marketing capabilities (Panzarino & Mathew 2011, p. 8). For example, Google can market their products through their search engine and Gmail website. Apple can also market its products through iTunes and its official website. This shows that Apple needs to effectively market iCloud as a way of ensuring that consumers have sufficient information about what it offers and its advantages (Peteraf & Barney 2003, p. 49). New products by both companies can easily reach their target market since they have great marketing capabilities (Craig & Benson 2007, p. 38). This means that Apple will have to attain another level of marketing in order to beat Google and other major competitors (Peteraf & Barney 2003, p. 49). This is because both the company and its major competitors use the same marketing techniques and have the same consumer group who access products from the same marketplace which is the internet (Panzarino & Mathew 2011, p. 8). Many entrepreneurs are able to start businesses and at the same time come up with new products that are viewed as a success automatically. However, many businesses look this promising but end up failing to grow into successful business (Peteraf & Barney 2003, p. 49). There are many reasons as to why they fail, the first reason maybe poor management and mismanagement of funds or low key performance by employees (Peteraf & Barney 2003, p. 49). However, consumers have a vital role to play in the success of a business (Lee 2011, p. 5). They are the ones who access the products and services offered by the organization and if they fail to do so, then the business will have to close down (Craig & Benson 2007, p. 38). Therefore, most businesses fail because it reaches a time when they are not able to offer consumers what they want r they fail to deliver value for money (Metayer 1999, p. 32). This comes as a result of poor communication between the company and consumers hence no audience for consumers to communicate what they expect from the organization. In order to ensure iCloud excels and enjoys a good position in the market, Apple should ensure that they communicate with consumers about how to use the product and how the product can be improved to suit consumer needs (Peteraf & Barney 2003, p. 49). Therefore the marketing technique adopted by Apple while advertising their cloud product should be interactive i.e. consumers should be give n the chance to give their response on what they think about the product and what they feel should be done to improve it (Panzarino & Mathew 2011, p. 8). This will play a central role in ensuring the company cements a good relationship with its consumers hence a positive competitive advantage (Peteraf & Barney 2003, p. 49). A company should always look at its strengths and use them to the maximum in a bid to maximize profits and minimize their weaknesses. Apple is one of the leading technological companies around the world. It is recognized for its iPad 1 and 2 gadgets and Apple Mac PCs. The company has a commanding consumer base in the United States among other countries. These are some of Apple’s strengths; therefore, they should be able to use these strengths to their advantage (Lee 2011, p. 5). This includes marketing their iCloud product alongside other products such as iPad. The consumer loyalty of most of the consumers will play a central part in ensuring that they use iCloud instead of traditional Medias of storage. Apple also owns websites such as iTunes and their official sales website (Craig & Benson 2007, p. 38). The company can use these websites for online marketing. The huge number of consumers that access these sites daily will have the chance to learn more about iCloud and its advantages hence increasing the probability of using it (Myslewski 2011, p. 9). As stated earlier, the company should strive to ensure that the marketing process is interactive where consumers are given a chance to ask questions or give views on what should be done to ensure that the product is improved (Panzarino & Mathew 2011, p. 8). The company should also try to ensure that consumer concerns are adequately addressed, this is important when it comes to cementing a positive relationship between the company and its consumers hence improving its competitive position in the market (Lee 2011, p. 5). As stated above, a company should always use its strengths to the fullest as a way of ensuring that they gain a positive competitive advantage, maximize profits and minimize the impact of its weaknesses. A SWOT analysis of Apple will clearly show the analyst that the company has not tapped into the whole global market. Apple’s main focus is in the United States and Europe, though most of its commodities are recognized in countries other than those in Europe and America. The company has not put emphasis in those areas (Peteraf & Barney 2003, p. 49). Unlike iCloud’s major competitors where individual companies have decided to occupy markets in the whole world. Apple has shown little focus in these areas. This gives traditional media companies the ability to market their products, improve them and gain consumer trust hence reducing the amount of market that will be occupied by iCloud in those areas. Apple should work to ensure that they expand their markets to these areas (Peteraf & Barney 2003, p. 49). This will help reduce the impact and influence of traditional media companies in these areas. The company can reach consumers in these areas using different marketing methods including marketing through online social networks or carrying out community outreach programs in those areas (Panzarino & Mathew 2011, p. 8). Many companies running online products such as iCloud are the main competitors. Facebook and Google can be termed as the chief competitors. However, given the scope and the quick evolution in the information technology world, more and more organization is expected to join the market (Peteraf & Barney 2003, p. 49). Therefore it is safe to say that the threat of new market entrants is extremely high. This is because the regulations restricting their entrance are minimal and the capital is relatively low compared with what is required by organizations in other industries (Myslewski 2011, p. 9). Apple needs to ensure that these new market entrants do not threaten their market share. This can be done by ensuring they establish a positive relationship with the current consumer groups. This can be done by coming up with loyalty programs one in a while. This will give consumers a sense of belonging (Gordon 1989, p. 74). Apple should also give consumers a chance to express what they think should be done to improve the product (Peteraf & Barney 2003, p. 49). This may involve having a comments section where consumers are allowed to comment on the products and the improvements that they think should be done on the product. This reduces the chances of a consumer switching from iCloud to another commodity due to dissatisfaction (Panzarino & Mathew 2011, p. 8). A consumer can be dissatisfied by a product once the product is not serving his needs therefore constant communication between the consumers and the company gives the organization a chance to determine what consumers require so that they continue serving the consumers best. It is also important to have unique products that will help ensure consumers do not switch to other products. iCloud is a new and unique product, though it had been seen earlier in the name of Mac. The earlier version did not have some of the features present in iCloud (Myslewski 2011, p. 9). The other products were just limited t individuals due to lack of space among other features (Panzarino & Mathew 2011, p. 8). However, iCloud has stretched the target market up to accommodating large companies. Employees can transfer their jobs to the iCloud account for access from any place either at home, while travelling or at the office (Peteraf & Barney 2003, p. 49). This is not possible with other online applications due to poor security relative to iCloud. The space offered by Apple gives an individual the chance to save media files and other personal documents. These documents cannot be affected by viruses or disappear in the event that that a computer crushes. This makes iCloud more effective than hard drives in saving information (Panzarino & Mathew 2011, p. 8). Increased usage of online social networks has presented organization another good marketing platform. A recent research has established that facebook has over 700 million users. This means that an effectively carried out worldwide marketing initiative through facebook will help a company reach over 500 million users. The marketing initiative will be viewed as completely effective since the company would have reached a huge number of consumers within a short time. Apple is well known worldwide for its quality products and services (Peteraf & Barney 2003, p. 49). This gives them a chance to effectively apply the use of online social networks to market iCloud to every corner of the world. The use of online social networks to market a commodity is cheaper compared to the use of traditional marketing methods. Online social networks are also able to reach consumers within a very short period of time (Lee 2011, p. 5). This reduces the time which an organization requires to pas information to consumers about a new product. Therefore, apple can gain an upper hand in the battle for market with traditional media companies by applying the effective use of online social networks in marketing iCloud (Panzarino & Mathew 2011, p. 8). In conclusion, Apple has to ensure that iCloud is effectively market to the whole consumer group. They must pass enough information to consumer especially the main features and advantages of iCloud over traditional storage Medias. It is important to understand that iCloud is not only facing competition from traditional media companies but also leading technological companies like Google and Microsoft. Apple should try to ensure that it gains consumer loyalty and trust as quick as possible by involving consumers in the advancement and development of iCloud since it is a new product in the scene. Google has offered consumers online storage in the email service (Gmail) same as Microsoft (Sky drive). Apple should work towards ensuring that any competition from such virtual storage services is eliminated. When it comes to competition with traditional media services, Apple has an advantage in marketing and advertising iCloud. This is because a good number of the target market access the Apple site ‘iTunes’ for music and other forms of entertainment. Apple can take this chance to advertise iCloud. As stated above the company can also market iCloud alongside some of its popular commodities such as iPad and iPod. Bibliographies Craig, F. & Benson, j.2007. "Business and Competitive Analysis: Effective Application of New and Classic Methods." FT Press Gordon, I. 1989. Beat the Competition. How to Use Competitive Intelligence to Develop Winning Business Strategies. Basil Blackwell Publishers, Oxford Lee, D. 2011 "WWDC 2011: OS X, iOS 5, iCloud coins unveiled (PHOTO LEAKS)". International Business Times Hong Kong. Myslewski, R. 2011 "Apple opens iCloud to world+dog". The Register. Metayer, E. 1999. "Demystifying Competitive Intelligence" Ivey Business Journal Peteraf, M. & Barney, J. 2003. Unraveling the Resource-Based Tangle; Managerial and Decision Economics 24. DOI:10.1002 Panzarino, K. & Mathew, J. 2011 "Apple’s iCloud Pricing: 5GB free, $20 for 10GB, $40 for 20GB and $100 for 50GB". The Next Web Read More