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Similaire à Apple Case Study - Embedding Apple into the integrated future (20)
Apple Case Study - Embedding Apple into the integrated future
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Reimagining the customer
High-Growth Potential Customer Profiles where Apple possesses a competitive advantage
Maintain
Partnerships with
high-end lifestyle brands
are attractive and comes
with a growing customer
base.
Grow
E-commerce platforms &
online services are
thriving and expanding
interoperability enables a
bigger market share.
Transform
Enhance business-friendly
products & services for
selected industrial
sectors to establish a
leading B2B market
position.
Luxury Goods
Consumers
Digital Natives
Rising
Industrial Sectors
- 4. Propelling
iPhone sales
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Maintain iPhone as key revenue generator
Target
Luxury
Consumer
• 40% are millennial and Gen Z
• Growing market 2X outside of China
• Digital entertainment – Games, Tik Tok
Extend
Luxury
Branding
• Potential : USD$353 billion in 2027
• CAGR : 4.6%
• Top brand : LVMH $53 billion euros in
2019
• Hermes watches rev gain additional
2% in 2020
Premium
product as
Social status
symbol
Differentiated
Customer
Identity
Develop
Luxury
Automotive
Partner
• Potential : US$22 billion in 2025
• CAGR : 7.58% CAGR
• Top brand :
Porsche US$1,774m in 2021
Enhanced
Customer Social
Class and
Lifestyle
Maintain
Growth
with Apple
Partnership
Impact Forecast:
USD $17B
(5% incremental
market share gain)
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Stronger as
Apple One
Accelerate Growth of Apple Services
Apple Services gained $15.7 billion USD, a 25% increase from Q1 2020.
Apple One (Apple Music, Apple TV+, Apple Arcade, iCloud, Apple News+, Apple
Fitness+) helped Apple reached a new high of 620 million subscribers.
App Store has emerged as the preferred medium for paid apps (27%) in the categories
Business, Education, Tools, Health & Fitness and Productivity, generating $11 billion
USD (205%) more than Google Play Store in Q4 2020, sporting a 37.2% CAGR
(2020).
With over $10 billion USD/year allocated into R&D for digital solutions, Apple Pay is
projected a 29% CAGR by 2027, est $8.94 trillion USD.
To accelerate this trend, we recommend expanding the interoperability of Apple apps
to other platforms such as Android OS, IoT systems, etc.
Impact Forecast: USD $6.28B (40% incremental growth from 2021)
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Embedding
Apple into
Businesses
Transform Apple into THE Industry Key Partner
Insights and Opportunities
• To transform the growth of Apple’s CE, 3 potential growth sectors
were identified for B2B Partnership using the ROQUE Forward
Assessment Matrix:
• Automotive infotainment (Total Market: est. USD $54.8 billion)
• Health (Total Market: est. USD $3.5 trillion)
• Education (Total Market: est. USD $43 billion)
• Core Applications: Building on the robust platform of Services, apps for
Remote Learning and Teaching, patient tracking, Medical Device
Integration, Automobile OS, Navigation, self-driving
• Core Hardware: iPad, Apple Watch, Macs
• Core Services: Pay, iCloud, App Store, Fitness+
• To pivot Apple to the long-term future growth opportunities, we
recommend accelerating deep integration with the above industries
through Apple products and services.
• Impact Forecast: USD $360B (10% incremental market share gain)
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Our Recommendation:
Projected Total Financial Impact: USD $383.3B
Maintain iPhone
Cash cow to sustain current top line and fund innovations for further growth.
1
Grow Apple Services
Current fastest growing category to eventually be on par with iPhone
revenue thus reducing pressure on iPhone.
2
Transform Industrial Application
Pivot present focus on CE by building on reliability and stability of CE products,
making products and services more business-friendly.
3
Incremental
Revenue Forecast: USD
$17B
Incremental
Revenue Forecast: USD
$6.3B
Incremental
Revenue Forecast: USD
$360B
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Appendices - Breakout Growth Areas (B2B)
ROQUE Forward Assessment Matrix™
B2B Sector iPad Mac iPhone Watch Sub-Total
Education 46 19 4 19 88
Airlines 48 1 13 15 77
F&B 30 7 12 14 64
Hotel 24 9 12 24 69
Healthcare 39 8 37 7 91
Automotive 35 1 29 38 103
Energy 20 12 7
18
56
Sub-Total 222 46 107 116
Based on Product Fit (20%), Growth Potential (50%), Competition (10%), Unique Selling Proposition (20%)
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Appendices – Maintain and Emerge Growth
Luxury Car Revenue is expected to show an annual growth rate (CAGR 2021-2025) of 7.58%,
resulting in a projected market volume of US$21,697m by 2025.
By Projected 2021 Rev, Luxury cars that continue driving sales in this segment. :
• Bentley US$483m
• Cadillac US$962m
• Lincoln US$364m
• Mercedes-Maybach US$1m
• Porsche US$1,774m
• Rolls-Royce US$477m
https://www.statista.com/statistics/262921/global-production-of-luxury-cars-by-make/
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Appendices – Apple Services
Apple One bundle (3 options)
• Individual ($14.95 per month) - Includes Apple
Music, Apple TV+, Apple Arcade, and 50GB
iCloud storage.
• Family ($19.95 per month) - Includes Apple
Music, Apple TV+, Apple Arcade, and 200GB of
iCloud storage, with the services able to be
shared between up to six family members.
• Premier ($29.95 per month) - Includes Apple
Music, Apple TV+, Apple Arcade, Apple News+,
Fitness+, and 2TB iCloud storage, with the
services able to be shared between up to six
family members.
Apple Services Stats
(https://www.statista.com/statistics/250918/apples
-revenue-from-itunes-software-and-services/,
https://www.macrumors.com/2021/01/27/apple-
services-revenue-q1-2021/)
Market Cap - $1 Tril
Q1 2021 Rev - $15.8 Bil
Q1 2020 Rev - $12.7 Bil
Q1 2021 Subscribers – 620 mil
2020 Rev - $64 Bil
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Appendices – App Store
App Store Data (2021)
(https://www.businessofapps.com/data/app-stores/)
2020 – 4.3 mil apps & games, CAGR (10y) – 35.25%
2020 – 3.4 mil apps, CAGR (10y) – 36.63%
Main growth from App spending (China region)
Top 10 App categories in order (Games (21.8%) >
Business (10.1%) > Education (8.65%) > Lifestyle
(8.6%) > Tools (6.1%) > Entertainment (5.7%) >
Travel & Local (3.8%) > Food & Drink (3.5%) > Health
& Fitness (3.4%) > Productivity (3%))
Free apps - 73%, Paid apps – 27% (avg app price
$4.90)
iOS App Rev
(https://www.businessofapps.com/data/app-revenues/)
Q4 2020 – $21.4 bil, CAGR (4y) – 37.2%
Q4 2020 (Gaming) – $13.0 bil, CAGR (4y) – 26.36%
Q4 2020 (Non-gaming) – $8.4 bil, CAGR (4y) –
74.79%
2019 iOS Subscription Rev - $3.6 bil, CAGR (5y) –
35.1%
Android Store Data (2021)
(https://www.businessofapps.com/data/app-stores/)
2020 – 2.9 mil apps & games, CAGR (10y) – 45.12%
2020 – 2.5 mil apps, CAGR (10y) – 45.2%
Top 10 App categories in order (Games (15.6%) >
Education (11.2%) > Business (8%) > Music & Audio
(7.6%) > Tools (6.7%) > Entertainment (6.5%) >
Lifestyle (5.7%) > Books 5.4 (3.5%) > Food & Drink
(5.1%) > Shopping (4.8%))
Education has risen in the past year, as schools
around the world have had to move teaching
online.
Free apps - 96%, Paid apps – 4% (avg app price $6)
Google Playstore App Rev
(https://www.businessofapps.com/data/app-revenues/)
Q4 2020 – $10.4 bil, CAGR (4y) – 35.34%
Q4 2020 (Gaming) – $8.8 bil, CAGR (4y) – 30.87%
Q4 2020 (Non-gaming) - $1.6bil, CAGR (4y) – 100%
2019 iOS Subscription Rev - $1.1 bil, CAGR (5y) –
61.54%
Key Takeaways
• Apple App Rev is 200% > Google’s
• Apple Games Apps is 275% > Google’s (due to
strict QC)
• Apple Apps avg price 22% < Google’s
• Apple Paid Apps Qty 675% > Google’s
• Apple App Rev (60% Games, 40% Non-Games),
Google App Rev (85% Games, 15% Non-Games)
• Apple App Subscription 327% > Google’s
• Apple App Developers earn more on iOS
• Apple App Categories on the rise, Business,
Education, Tools, Health & Fitness, Productivity
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Appendices – Apple Pay
Apple Pay Stats & Facts
(https://www.statista.com/topics/4322/apple-pay/)
Mac, iPad, iPhone, Apple Watch enabled for Apple Pay
(Products growth greatly propel adoption of Apple
Pay)
# of Apple Pay users worldwide:
507m, CAGR (5y) – 49.89%
Apple Pay reach among global iPhone user base:
48%
U.S. Apple Pay payment app usage frequency:
About once a week - 3%
Share of U.S. users who use Apple Pay at every chance
they get:
18.3%
Share of U.S. users who rate the ease of Apple Pay the
same as swiping a card at checkout:
67.8%
Share of U.S. Apple Pay users who are very satisfied
with the service:
49%
Global Mobile Payment Market Share
(https://dataprot.net/statistics/mobile-banking-statistics/)
Users (2021) – $5.22 Bil
Android Pay, Apple Pay, and Samsung Pay take
collectively 49% market share
(https://financesonline.com/online-payments-
statistics/#mobile)
Value of Payment (2020) – $503 Bil
• Projected CAGR – 29% (2020 – 2027), est ($8.94
Trillion)
• 23% Adoption rate, remainder cited Security concerns
as main impediment
• Banking malware up by 50% in 2019
(https://www.creditcards.com/credit-card-news/online-
payment-statistics-1276/)
Takeaways
Apple works extensively with Banks, may lead up to Apple
Card
Fintech extension - P2P Payment e.g Venmo, Microfinance
e.g Hoola, Atome
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Appendices - Entertainment-Based Opportunities For Growth
Apple TV+
Global Market: Details
Market size value in 2020 $50.11 billion (USD)
Market size value in 2021 $59.14 billion (USD)
Revenue forecast in 2028 $76.9 billion (USD)
Estimated Growth Rate: CAGR of 21% (2020 – 2027)
Source: https://www.grandviewresearch.com
• The consumer segment was the largest revenue share in 2020,
with a 51% of market.
• Smartphones and tablets were the largest revenue share in 2020,
at 31% market share.
• The subscription model held the largest revenue share of the
video streaming market in 2020, with 43% of the market.
What Apple Has/Needs to Succeed:
1. Continued Apple Product Innovation (App must by on TV’s)
2. Support Infrastructure (Alliance with Cisco, 2015)
3. Address Global Anti-trust RISK (Structuring/ Partnerships).
4. Fund Original Content and, Partner to avoid Antitrust issues.
Products Used For Online Video:
Apple Arcade
Global Market: Details__________
Market size value in 2019 $154.05 billion (USD)
Estimated Growth Rate: CAGR of 11.5% (2020 – 2027)
Source: https://www.grandviewresearch.com
• The Mobile Gaming App market was largest revenue share provider
for the Mobile Apps market: > 40% in 2019. Gaming is the largest
source of Revue for the App Store.
• In 2017 Apple Arcade had 2.3 Million subscribers, by 2018, 12
Million.
Apple’s Service Sector gross margin: 66.0%
Apple’s Product Sector gross margin: 31.5%
(SEC 10-K Filing, September 2020)
• Premium games, in-app purchases and 30% share from each
purchase smooths profit growth between new product releases.
Apple Music Store
Global Market: Details___________
Market size value in 2019 $17.8 billion (USD)
Market size value in 2020 $24.4 billion (USD)
Revenue forecast in 2027 $28.7 billion (USD)
Estimated Growth Rate: CAGR of 17. 8% (2020 – 2027)
Source: https://www.grandviewresearch.com
2019 Global Market Share by Top Music Streaming Providers:
(Spotify vs. Apple Music global subscribers, 2015 – 2019 –
https://www.businessofapps.com/data/spotify-statistics/)
• The 2015 Revamping of iTunes with Apple Music – has
revived Apple’s Music Streaming Segment of Services.
• Globally, Apple is second only to Spotify in Music Streaming
and in close competition to be #1 in the United States –
Apple’s strong hold market.
• The Cross-Platform design used by all of the music
streaming applications may make them very much immune
to Antitrust Litigation as well as media purchases, this same
model could benefit the Video Streaming Services of Apple
TV.
This Service Segment is making slow gains that will prove
relevant as YouTube loses market share and Android becomes
more fragmented.
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Education
• Market Size
• Target Penetration
Ø40% by 2024
• Proposed applications:
• Teaching tool for educators
• Learning tool for students
• Proposed products
• iPads, Macs
Health
•Market Size
•Target Penetration
•50% by 2024
•Proposed applications:
• Patient review tool for HCPs
•Medical records
•Health tracking, intervention
•Patient entertainment devices
•Storage services
Automotive
• Market Size
• Target Penetration
• 20% by 2024
• Proposed applications:
• Teaching tool for educators
• Learning tool for students
• Proposed products:
• iPads, Macs
Appendices - Breakout Growth Areas (B2B)