PESTAL Analysis of APPLE

I would like to discuss Apple Inc today. I am sure we all know about Apple and familiar with the products and services it offers. We can do a PESTAL analysis of Apple. P for Political – Current trade war between the USA and China made Apple vulnerable to tariffs. Apple is a California, USA based company that does business all over the world, and it’s partner Foxconn, which is a Taiwanese company manufactures parts in China. In the current geopolitical situation when nations are imposing or considering the idea to impose the tariff on each other made Apple vulnerable with it’s globally exposed supply chain. Apple needs a politically stable environment to continue their operation without any major disruption. E for Economic – While the US economy is doing pretty well with low employment, but the Chinese economy and the European economy is slowing down. A low growth environment is not very good for Apple as it produces really expensive phones, which are not really essential goods for people. So in a slow economy, Apple might see a decline in sales. And in a growing economy, Apple sales might soar. S for Social – Apple has earned a great reputation world over for the quality of the products and those products are somewhat status symbols too as those are pricier than nearest competitions. There is a cult-like following for Apple products too. These are positive for Apple products, in case these changes in the future, Apple’s future might suffer. T is for Technological – Apple is mainly a technology-centric company. And its success will depend upon how well it continues innovation. Lately, Apple is lagging competitors like Samsung. But Apple needs to be the leader again with great innovations. E for environmental – Apple usage products or minerals that causes havoc for the environment. But these minerals are extracts in parts of the world where the economy is not that strong and mining is important. In case if anything happens in terms of a ban on mining rare earth minerals etc. that might negatively impact Apple. Even 60% of Apple products end up as landfills in Africa, Asia (Veksler,2017). L is for Legal – Intellectual property rights is very important for Apple to continue innovating and then continue being a leader in the space. But, intellectual rights protection is important in all parts of geography for Apple, because it manufactures parts and assembles them in different geographies. In 2018, Apple and Samsung settled a 7-year long patient war (Kastrenakes,2018) which was on different features both these companies are using in their phones. I believe a substitute is a big environmental aspect for Apple. If tariff makes the Apple products more expensive, in that case, a competitor like Samsung my sell more hardware’s. And slow economic growth can work out well for another hardware manufacturer like Motorola, LG, etc. Technological innovation will be very important, as the better features any device offer, those devices will be perceived as better value for money. And Chinese phone manufactures or Samsung are manufacturing products with innovative features. Apple as a company started new product categories, such as iPod, iPad/ tablet computers, touch screen, and smartphones. The competitors all had to produce similar products and now the world uses smartphones. Nokia used to be the leader in the mobile phone segment, now they are almost non-existent. The society is changed because of the products Apple has produced in the past and the technology it pioneered. Apple belongs to hardware strategic group. Samsung, LG, Nokia, Google these are the other few companies Apple has in that group, while most of these companies offer way too man products than Apple does.