APPLE COMPUTERS MARKET SHARE: PROBLEM IDENTIFICATION
The market share in the microcomputer market for Apple Computers has been slipping for several years. In 1995, however, the slippage became a near land-slide (Verespej 20-25). The market share problem at Apple Computers involves each of the "Four Ps of Marketing."
The first "P," product, is defined in terms of characteristicsùquality level, features, styling, brand name, and packaging. Depending upon the type of product involvedùphysical, service, and so forth, not all of these characteristics will be applicable in each instance. Quality level of Apple Computers products was an is generally high, the brand name was and is strong, and neither styling or packaging were major issues. Features, however, represent a major problem for Apple Computers. The company touted the ease of use characteristics of their computers, but conveniently overlooked the inability of the machines to perform the high-level multitasking operations demanded in many business use environments. The result was that Apple Computers developed great customer loyalty in a market niche, and in 1996 the company's market share of the microcomputer market is around eight-percent and moving downward. Apple Computers in effect told consumers that "we make a great product, and you're nuts if you buy an IBM compatible." Most of the market, unfortunately for Apple Computers turned out to be "nuts."
The second "P," price, also proved to be a thorny issue for Apple Computer. The company perceived that its product was the superior product and priced it accordinglyùhigher than the competition. Additionally, Apple Computer until 1995 refused to allow other manufacturers to clone the Apple computer designs. IBM clone makers, however, cause price reductions for IBM compatibles, and a surge in market share away from Apple Computer products. Once Apple Computers determined to become price competitive in 1995, ma...