Should Apple be more concerned with profits or market share?

[thermal]

An article on the main page talks about the iPhone's tremendous profits vs relatively small market share. Some are arguing Apple is actually not doing so well because they are increasingly losing market share to Google.

Which do you think is a better direction?

a) The Porsche model: make fewer, high quality products for less market share but greater profit, or

b) The GM model: make a large number of products from cheap to expensive, and try to increase market share at the expense of quality.

 

[rdowns]

First of all, Apple only makes smartphones as opposed to others making other types of phones.

When it's all said and done, Android will have a larger share of the market but that share will be split among several manufacturers while Apple will probably have about 20% of the smartphone market. I bet most of the manufacturers would rather have that position.

 

[*LTD*]

Profit, obviously. It's a business.

In fact they need to do whatever they've been doing up until now. Simple as that.

 

[elppa]

I wonder if Apple went for volume (and really went for it - like eating into some of their cash to sell phones at a loss) then it might work out well in the long run for profiting for many years from services and ads.

If the iPhone got really entrenched, especially in business, like Windows is today AND became the go to phone for nearly all consumers then it would be a cash cow for years to come.

Right now it feels like they are as good as their last model. Which in many ways is good because it keeps Apple lean and hungry, but for stability is bad. But that's what Steve wants - to run the company like a start up.

 

[ucfgrad93]

First of all, Apple only makes smartphones as opposed to others making other types of phones.

When it's all said and done, Android will have a larger share of the market but that share will be split among several manufacturers while Apple will probably have about 20% of the smartphone market. I bet most of the manufacturers would rather have that position.

Agreed. I think Apple is in a very good position right now.

 

[Bernard SG]

Apple is concerned about segment share rather than market share.
Reportedly, Mac represents 91% of revenue for computers costing above $1000. That's absolutely HUUUGE.

 

[*LTD*]

Apple is concerned about segment share rather than market share.
Reportedly, Mac represents 91% of revenue for computers costing above $1000. That's absolutely HUUUGE.

Someone gets it, I see.

And this strategy equals.... Differentiation writ large.

 

[Melrose]

First of all, Apple only makes smartphones as opposed to others making other types of phones.

When it's all said and done, Android will have a larger share of the market but that share will be split among several manufacturers while Apple will probably have about 20% of the smartphone market. I bet most of the manufacturers would rather have that position.

Good point, except, with Android's fragmentation it's basically like having a whole bunch of itsy-bitsy-market-share OSs that kinda all look the same but can't really reliably install manufacturer updates, or even some supposedly native apps.

 

[decksnap]

They are concerned about profits so long as the market share does not dip so low that they lose the development community, both Mac and iOS. Market share would become their goal if they got to a point again where someone like Microsoft didn't think it was worth it to develop for the Mac.

 

[Mr Kram]

firstly, the porsche model, no longer applies. the cayenne is the top selling model, and now they've introduced a sedan, albeit, not cheap. lastly, they've bastardized the 911 line. there has to be at least 10+ variants of the 997. certainly, this is not gm, but they are producing whatever sells.

with that being said, apple should continue to focus on being profitable. after all, it is a publicly traded company and they have a responsibility to the shareholders. if they continue to do what they do best, growth and market share will naturally follow.

 

[R94N]

Well, every business's aim is to make a lot of profit, which Apple already does....and I don't think the company cares too much about market share, just that they make good products. Steve has said this numerous times in the past.

 

[chrmjenkins]

Steve Jobs himself has pointed out that their market share is similar to luxury brands like BMW and Mercedes. He simply asks what's wrong with either of them. So, in short. It's about profit. Market share is part of that, but apple won't do anything to dilute their product line or compromise their standard product philosophy.

 

[G4er?]

b) The Toyota model: make a large number of products from cheap to expensive, and try to increase market share at the expense of quality.

Fixed it for you. Toyota really did turn into a Japanese GM. I'd almost go so far as to say GM is closer to being what Toyota was than the current Toyota.