PESTLE Analysis

PESTLE Analysis of Apple Inc

by The TSW Team

The company which started in a garage is now one of the biggest tech giants of the planet! Yes, we are talking about none other than Apple Inc. It is one of the most influential consumer electronics brand in the market. People sees Apple Inc. as a brand worth their money and trust.

PESTLE Analysis of Apple Inc

Political Factors Affecting Apple Inc

Apple Inc. is an American technology company. As one of the biggest tech giant, Apple has been in the center point of many political influences. As of the first quarter of 2020, Apple Inc. has a revenue of 29.32 Billion US Dollars in American Soil. (1)  This gross regional revenue has become a prominent political issue considering the fact that Apple Inc. plays a huge role in the country’s economy. In the recent years, Apple Inc. has been manufacturing their products in China for lower the expanses in manufacturing. This has also lead to various objections as the political relation between China and America has been rough in recent times. If the dependency on China continues in such pace, Apple Inc. might face vulnerable encounters in the United States. On the other hand, Apple Inc. can face difficulties in Chinese territories prior to growing Anti-Americanism. Apple Inc. will have to be more careful in different regions.

Economic Factors Affecting Apple Inc

As we have said before, Apple Inc. has been one of the most influential electronic consumer brand in the world. But there are some hurdles in front of the tech giant in the upcoming years. As we move forward, Apple Inc. could face a decline in sales if the cost of manufacturing goes higher prior to the increase of the labor cost in China. Increased labor cost means more pennies in manufacturing. More money in manufacturing leads to the increase in retail prices. Which will lead to lesser consumption of Apple Products. On the other hand, Apple Inc. makes premium quality products which is above the average level. So, in low income or developing countries, Apple products has a stiff sales rate which is affecting the company’s revenue every year. Other companies creating rivalries which is also making the market capture of Apple Inc. harder day by day.

Social Factors Affecting Apple Inc

Apple Inc. has been revamping the social lives of millions with their state of the art Apple products. But there are some region where Apple products are still unrecognized. For instance, there is a large consumption rate of consumer electronics in the African market. But the African consumers are not well aware of Apple Inc. and their Apple Products. If we see in the statistics, the consumer spending in South Africa in the late quarter of 2019 is almost around 1,966,371 million ZAR. (2) It has grown at an enormous rate in a short amount of time. But unfortunately, Apple Inc. has not been active in seeing the potential to enter the African market. On the other side of the world, Apple Inc. has entered the markets of India, Bangladesh and other developing countries. But due to the taxes on consumer electronics, Apple products are a bit pricy. So, people are choosing other brands and products over Apple Inc.

Technological factors Affecting Apple Inc

As far as the technological aspects and advancements are concerned, Apple has been a vigilant on introducing new ground breaking technologies and products to the world. Apple’s eco system has been one of a kind if we need to speak of that. But other tech rivals are catching up with their own version of tech and products. Today, Apple has not been the king it used to be anymore. The competition is very high. For instance, take the launch of Android Pay on the 11th of September, 2015 by Google TTC. (3) It was the worthy competitor of Apple Pay which launched months after Apple’s. In the vastly growing market, Apple has launched new products to enter new sectors. For example, launch of Apple TV. It was a competitor for already established companies like Netflix, HBO and Amazon Prime. Thus Apple TV has a limited market capture.

Legal Factors Affecting Apple Inc

Apple Inc. has been facing a vast array of legal issues over the years in various regions. Perhaps the most controversial legal conspiracy was that the accusation of slowing down the performance of the older models and products deliberately to increase the sales of the newer products. After the accusation, it went down to the trails and Apple Inc. had to give away 500 million US Dollars to the customers as a compensation. (4) Another legal pursuit came under the spot light when Qualcomm, a prominent silicon company who manufactures chipsets for consumer electronics claimed that Apple has been using their patented technology in their products. (5) Both the companies are suing each other in various regions and there has been fierce legal battles. Another notable instance is the antitrust action is pulled up against Apple Inc. for being bias in the App store and conducting monopolistic practices. (6)

Environmental factors of Apple Inc

Environmental factors are a huge hiccup for any consumer electronic brand in the planet. Perhaps the biggest void is the lack or reusing the electrical components. Apple Inc. has struggled over the years in disposing the used or disrupted Apple products. Non-biodegradable products and waste are polluting the environment which can be a huge problem in the upcoming years for Apple Inc. On the other hand, manufacturing cost might go high as China has decided to stop greenhouse gas emissions and reduced the use of fossil fuels in producing electricity. Nevertheless, China is criticized heavily for being the largest nation for polluting the environment in an alarming rate. (7) If this continues in the same passion, then China will face a huge decline in the industrial aspects. Apple Inc. heavily relies on Chinese manufacture industries. So it will be a viable threat for the tech giant as well.

Recommendations for Apple Inc

In the PESTLE Analysis of Apple, we found several negative and positive issues. The company has been changing the lives of people ever since they have started their journey. Despite being a bit rusty or ‘unprofessional’ in some encounters, Apple products has come up with some ground breaking technological breakthroughs which are worth appreciating. Apple Inc. should take that as a boost of confidence.

Related

Reference Links

  • https://www.statista.com/topics/847/apple/
  • https://www.statista.com/statistics/233147/total-consumer-spending-in-south-africa/
  • https://www.androidauthority.com/how-to-use-android-pay-678739/
  • https://techcrunch.com/2020/03/02/apple-agrees-to-settlement-of-up-to-500-million-from-lawsuit-alleging-it-throttled-older-phones/
  • https://www.digitaltrends.com/business/apple-vs-qualcomm-news/
  • https://realmoney.thestreet.com/investing/stocks/apple-shareholders-have-larger-legal-issues-than-qualcomm-to-consider-14805668
  • https://chinapower.csis.org/china-greenhouse-gas-emissions/