Friday, October 12, 2007
Apple Inc
Introduction
Apple Inc. (formerly Apple Computer, Inc.) is an American multinational corporation with a focus on designing and manufacturing consumer electronics, and other closely related software products. Apple develops, sells, and supports a series of personal computers, portable media players, computer software, and computer hardware accessories. Less than a year after procuring NeXT, Apple established their online store, Apple Store, on 10 November 1997 with the use of NeXT's WebObjects web application technology. This technology was previously utilised by Dell to build its online store as well. WebObjects helped Apple to create and deploy its online store within a year. Consequently, it was announced by Steve Jobs that the new Apple online store acquired over $12 million in sales merely one month into its operation. In addition, Apple had also revolutionized the computer and music industry by signing the five major record companies to join its new music download service, the successful iTunes Music Store, now known as iTunes Store. Unlike other fee-based music services, the iTunes Store charges a flat $0.99 per song (or $9.99 per album). Users have more flexibility as compared to previous on-line music services. The iTunes Music Store was launched in 2003. Within only 16 days, there were already 2 million downloads. On 12 September, The iTunes Music Store changed its name to iTunes Store. It began offering video content (TV shows and movies) for sale. Since, iTunes has sold over 2 billion songs, and clocked over 50 million TV episodes and 1.3 million movie downloads. Thus, it is evident that an e-commerce website is feasible, playing the significant role of an effective and efficient intermediary in generating revenues for the company.
Origins
Apple was founded on 1 April 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne. It was later incorporated on 3 January 1977 without Wayne as he sold his share of the company back to Jobs and Wozniak. Their very first creation called the Apple-1 personal computer kit, was hand-built by Steve Wozniak and was first shown to the public at the Homebrew Computer Club.
Since its earlier days, Apple has made tremendous progress. The beginning of Apple’s success was in 1997 (the first year the company turned a profit after losses through 1995 and 1996). Their success accelerated between 2003 and 2005, and this was apparent in its rapidly rising stock. Between early 2003 and January 2006, the price of a share of Apple's stock increased more than tenfold on 13 January 2000, resulting in its market cap surpassing that of Dell. From a little more than US$6 per share, it rose to more than US$80 per share!
Website Purpose
As a result of the proliferation of the Internet’s importance in our society today, it is important for a major organization like Apple to have a diverse, elaborate and educational website in order to compete against the other major players in the industry. Therefore, the website acts as a platform for attracting new customers to their products. Without neglecting their satisfaction, Apple could even possibly induce their existing customers into buying other merchandises from their website.
The Apple Store online also brings about convenience to the consumers worldwide, enabling the Internet-savvy masses to gain relevant information and knowledge they require about their product(s) of interest at the touch of their fingertips. Hence, the consumer is able to make a sagacious decision on which item to purchase. Besides this, the website keeps Apple’s ardent supporters well-informed and updated on the new products available as well.
Characteristics of the Website
The Apple Store online has a captivating and modern design which enables effortless viewing of the various Apple merchandises and accessories for sale. Moreover, the website provides clear and precise links. Although there are many links and information available on the website, the website does not look cluttered and convoluted. As the Apple Store online is very interactive and entertaining, it is able to capture consumers’ attention when they visit the site. Some examples would be its featured tutorial videos on the usage of Apple products and enabling consumers to download music, trailers, television advertisements, and even movies on iTunes.
Payment Methods
Apple allows the payment methods described below, and even the combination of more than one payment method for a single purchase.
• Credit, Debit, and Check Cards
The Apple Store accepts Visa, MasterCard, American Express, and Discover cards.
• Apple Gift Card
With an Apple Gift Card, an individual can purchase just about anything sold by Apple (except another Apple Gift Card, or an iTunes Gift), including products from both Apple and third-party manufacturers and developers.
• Financing
Qualified purchasers may finance all or a portion of their purchases with the Juniper Visa Card.
• Combining credit, debit, check, and gift cards and Apple Credit
Usage of more than one credit, debit, charge, or gift card (or combination of them) to pay for anything Apple sells, except for an Apple Gift Card, an iTunes Gift Certificate or software download such as QuickTime. Payment with two credit cards can be made by indicating the amount to place on the primary card. The remaining balance will be allocated automatically to the second card. An Individual may also use up to a total of four Apple Gift Cards, by themselves or in addition to one credit card. If one is financing all or a part of his/her purchase through Apple Credit, he/she may pay with a combination of a credit, debit, or check card and what he/she finance through Apple Credit, or with up to four Apple Gift Cards and what he/she finance through Apple Credit.
• Cashier's Check or Money Order
The Apple Store accepts cashier's checks and money orders as valid forms of payment.
Payment Method for iTunes
The iTunes Store accepts credit cards, payment through PayPal account, iTunes Cards, iTunes Store Gift Certificates and Allowance Account balances as forms of payment. The iTunes Store accepts the following credit cards: Visa, MasterCard, American Express, and Discover.
Additional Purchasing Method
1-Click is a registered service mark of Amazon.com, Inc., used under license.
1-Click is a convenient feature that allows an individual to purchase from the Apple Store with a single click of the mouse. In order to activate 1-Click features, an individual must have an Apple Store Account. Once the 1-Click features have been activated, the individual may select the products he/she wishes to purchase and click the "Buy with 1-Click" button. When purchasing products using 1-Click, he/she will have 90 minutes to change items in the 1-Click order (except for Electronic Software Downloads). All of the items that are purchased within the 90 minutes will be consolidated into one order, to save on shipping costs.
Safety Features
Apple supports industry initiatives — such as the Online Privacy Alliance and TRUSTe — to preserve privacy rights on the Internet and in all aspects of electronic commerce. The company does not knowingly solicit personal information from minors or send them requests for personal information.
Apple is a licensee of the TRUSTe Privacy Program. TRUSTe is an independent, nonprofit organisation whose mission is to build users’ trust and confidence in the Internet by promoting the use of fair information practices. Apple also discloses their information privacy practices for compliance review by TRUSTe. The TRUSTe program covers only information that is collected through this website, and does not cover information that may be collected through software downloaded from the site.
How Personal Information Are Protected
The Apple Online Store and iTunes Music Store use Secure Sockets Layer (SSL) encryption on all web pages where personal information is required. To make purchases from the Apple Online Store or iTunes Music Store, an SSL-enabled browser such as Safari, Netscape Navigator 3.0 or later, or Internet Explorer must be used. Doing so protects the confidentiality of the customer’s personal and credit card information while it’s transmitted over the Internet.
Business Model
Apple uses two types of Business Models, Merchant Model and Manufacturer Model.Merchant Model - Wholesalers and retailers of goods and services. Sales may be made based on list prices or through auction.
• Bit Vendor - a merchant that deals strictly in digital products and services and, in its purest form, conducts both sales and distribution over the web.
Manufacturer (Direct) Model - The manufacturer or "direct model", it is predicated on the power of the web to allow a manufacturer (i.e., a company that creates a product or service) to reach buyers directly and thereby compress the distribution channel. The manufacturer model can be based on efficiency, improved customer service, and a better understanding of customer preferences.
• Purchase -- the sale of a product in which the right of ownership is transferred to the buyer.
Strengths of the Apple Online Store
• provides a wealth of resources that allows users to be kept up to date regarding any new developments of the firm, information and reviews of products they manufacture.
• gathers all the hardware, software, third party software and accessories all under one roof to provide online shoppers the conveniences that would spur their desire to own an Apple product.• displays the array of special promotion plans such as; education discounts, corporate gifts plan that would enable users to have a better shopping experience.Apple itself has given itself the market edge by diversifying their product range from Mp3 players to Multimedia players, Computers, Software and the latest addition – the iPhone. It also provides a large range of 3rd party accessories and software to users that would complement its own products.
Apple has also added a very personalized touch - an Apple online account. This account stays up to date with all orders (past and present) and also keeps customers’ personal information with them so as to provide service at a more efficient pace.
Weaknesses of the Apple Online Store
• Apple has got a lot more to do to offer the service to consumers worldwide.
Initially, only Mac OS X users who had credit cards with a US billing address could buy songs with the service. Apple has since released the iTunes for Windows and launched iTunes Music Store in Europe, Australia and Japan. Residents in other countries can only buy a gift card from a merchant to purchase music and or download free podcasts and previews.
• Apple has spent much time trying to ensure that anyone who buys an iPod is completely locked in to an Apple-centred world (in which they use iTunes, buy from the iTunes Music Store, and purchase only Apple-certified iPod accessories) and this might not be good news to many consumers.
• As Apple doesn’t support Linux, any Linux user who can't resist the lure of an iPod needs a non-Apple library manager.
With the latest version of iTunes, Apple has added a new feature to the iTunes database, a special number that is calculated from your list of files using a process only Apple knows. If the number is wrong, your library looks empty. And because the free players don't know the algorithm used, they can no longer be used with iTunes/iPod.
These limitations of iTunes and its music store is limiting Apple’s penetration rate to other regions outside Europe, US and Australia. Apple needs to work on integrating its network to open its online music stores to regions where the Internet penetration rate is high, for example, South East Asia.
Conclusion
The strengths of Apple reflect the ways they use to integrate their products with their software and web presence. The weekly tips and tutorials uploaded online keeps the consumer checking back their website.
The Apple homepage features a clean design with an easy-to-navigate menu. It is obvious that “the Apple feel” is a top priority in the site’s development. Consumers not only learn how to optimize Apple products, they also learn of new products each time they return to the Apple homepage. Links to purchase items are strategically placed to product pages, and these links make online purchases quick and easy. The web store is also fully integrated with its customers’ database and helps to increase the convenience to buy online.
Market research indicates that Apple draws its customer base from an unusually artistic, creative, and well-educated population. Apple owes its successful in reaching to and converting customers to their web presence.
As of July 2007, the store has sold 3 billion songs, accounting for more than 80% of worldwide online digital music sales. This proves that Apple’s business model and online stores work. Today, Apple has the highest brand and re-purchase loyalty of any other computer manufacturer, and is a role model to all in the industry.
Introduction
Google Inc is an American public corporation specializing in Internet search and online advertising. Well-known for offering faster and more useful searches compared to other competitors on a clean and user-friendly website, Google is currently the most used search engine on the web. Since its founding in 1998, Google has blossomed into the Internet's leading search engine, fielding nearly 200 million queries a day.
How it started
What started as a research project in 1996 became a gold mine for 2 PhD students at Stanford University, California. Sergey Brin and Larry Page, both graduate students in computer science, first met at Stanford University in 1995. They soon found a common interest in retrieving relevant information from large data sets. This interest led to their contribution of a scientific paper entitled “The Anatomy of a Large-Scale Hyper Textual Web Search Engine”.
The pair hypothesized that a search engine that analyzed the relationships between websites would produce better results than those which ranked results according to the number of times the search term appeared on a page. Page and Brin were convinced that the pages with the most links to them from other highly relevant web pages were likely to be the most relevant pages associated with the search. Following this, they tested their thesis as part of their studies, and laid the foundation for their new search engine.
The domain Google.com was registered on 15 September 1997, and the company was incorporated as Google Inc on 7 September 1998. The total initial investment raised for the new company eventually amounted close to $1.1 million and its initial public offering took place on 19 August 2004. Due to strong sales and earnings in the advertising market, Google’s shares surged to above $500 a share by 2007, giving the company a market value of US$147 billion, right behind Chevron and just ahead of Intel.
Google indexes billions of web pages so that users can search for the information they desire through the use of keywords and operators. In 2000, Google began selling advertisements associated with search keywords. This meant that every time an Internet user ran a search, text ads relevant to the search keywords would be served. Google sold these keywords based on a combination of price bid and the clickthrough rate.
Advertisers understand the value of being able to bid for juicy keywords. The ads can be laser targeted and the number of clicks can be measured precisely. Google figured out that sponsored links could be placed alongside a more objective set of search results. It was a brilliant way to turn searches into revenue.
How does it work?
Advertisers specify the words that should trigger their ads and the maximum amount they are willing to pay per click. When a user searches Google's search engine on www.google.com, ads for relevant words are shown as "sponsored links" on the right side of the screen, and sometimes above the main search results.
The ordering of the paid listings depends on other advertisers' bids and the "quality score" of all ads shown for a given search. The quality score is calculated by historical click-through rates and the relevance of an advertiser's ad text, keyword, and landing page to the search, as determined by Google. The quality score is also used by Google to set the minimum bids for an advertiser's keywords.
In 2002, engineers at Google took the concept of pay-per-click search results and turned it into their flagship advertising product, AdWords. The AdWords program can schedule ads for local, national and international distribution. All AdWords ads are eligible to be shown on google.com. Besides this, advertisers also have the option of enabling their ads to show on Google’s partner networks, i.e. AOL Search, Ask.com and Netscape.
In 2004, Google launched its own free web based email service, Gmail. Gmail features spam filtering technology and the capability to use Google’s technology to search emails. This service further generates revenue - by displaying ads from the AdWords service that are tailored to the content of the email messages displayed on screen.
Today, most of Google’s revenue is generated from advertising programs. For the 2006 fiscal year, the company reported $10.492 billion in total advertising revenues and only $112 million in licensing and other revenues.
Google’s growth and acquisitions
Google has acquired several small start-up companies since 2001, often consisting of innovative teams and products. The company has also begun to experiment with other markets outside the web content arena by purchasing radio advertising company dMarc and also selling advertisements from its advertisers to offline newspapers and magazines.
In late 2006, Google bought online video site, YouTube for $1.65 billion. To cash in on this acquisition, Google will display YouTube videos on thousands of other websites, with the hope of profiting from ads attached to these clips. A typical advertisement would appear as a graphic straddling the video or as a link along the bottom. To bring in high revenue, broad distribution of YouTube video clips would be extremely essential.
Google’s competitive edge against main competitor, Yahoo!
In 2003, Yahoo! acquired Overture Services, Inc (Goto.com), the company that pioneered the keyword-based “pay per click”/ “sponsored search” Internet ad service. Although Yahoo! had its search engine and search advertising technology then, they had difficulties integrating the 2 together. As a result, this would cause Yahoo! to be 2 years behind schedule to compete in the search-driven advertising business.
Firstly, Google’s AdWords service allowed customers to buy ads through a fully automated system while Overture’s did not. Secondly, Google’s AdWords has an effective way to push ads onto blogs with matching subject matter unlike Yahoo!.
Crucially, Google determines ad prominence on a web page not just by the price advertisers are willing to pay per click but also, based on how many clickthroughs that ad generated. As a result, Google responded quickly to ineffective ads by taking them off. However, Overture’s practice of displaying ads was based solely on how much the advertiser had offered to pay per click. This meant that irrelevant ads could end up at the top of the “sponsored results” column.
Conclusion
Google Inc is an American public corporation specializing in Internet search and online advertising. Well-known for offering faster and more useful searches compared to other competitors on a clean and user-friendly website, Google is currently the most used search engine on the web. Since its founding in 1998, Google has blossomed into the Internet's leading search engine, fielding nearly 200 million queries a day.
How it started
What started as a research project in 1996 became a gold mine for 2 PhD students at Stanford University, California. Sergey Brin and Larry Page, both graduate students in computer science, first met at Stanford University in 1995. They soon found a common interest in retrieving relevant information from large data sets. This interest led to their contribution of a scientific paper entitled “The Anatomy of a Large-Scale Hyper Textual Web Search Engine”.
The pair hypothesized that a search engine that analyzed the relationships between websites would produce better results than those which ranked results according to the number of times the search term appeared on a page. Page and Brin were convinced that the pages with the most links to them from other highly relevant web pages were likely to be the most relevant pages associated with the search. Following this, they tested their thesis as part of their studies, and laid the foundation for their new search engine.
The domain Google.com was registered on 15 September 1997, and the company was incorporated as Google Inc on 7 September 1998. The total initial investment raised for the new company eventually amounted close to $1.1 million and its initial public offering took place on 19 August 2004. Due to strong sales and earnings in the advertising market, Google’s shares surged to above $500 a share by 2007, giving the company a market value of US$147 billion, right behind Chevron and just ahead of Intel.
So how does Google make money?
Google makes money by selling ads associated with search keywords. Though this business model was actually pioneered by Goto.com (acquired by Yahoo! later on), it never became a top-tier search destination. However, Google saw the power of this approach and decided to grow its own.
Google makes money by selling ads associated with search keywords. Though this business model was actually pioneered by Goto.com (acquired by Yahoo! later on), it never became a top-tier search destination. However, Google saw the power of this approach and decided to grow its own.
Google indexes billions of web pages so that users can search for the information they desire through the use of keywords and operators. In 2000, Google began selling advertisements associated with search keywords. This meant that every time an Internet user ran a search, text ads relevant to the search keywords would be served. Google sold these keywords based on a combination of price bid and the clickthrough rate.
Advertisers understand the value of being able to bid for juicy keywords. The ads can be laser targeted and the number of clicks can be measured precisely. Google figured out that sponsored links could be placed alongside a more objective set of search results. It was a brilliant way to turn searches into revenue.
How does it work?
Advertisers specify the words that should trigger their ads and the maximum amount they are willing to pay per click. When a user searches Google's search engine on www.google.com, ads for relevant words are shown as "sponsored links" on the right side of the screen, and sometimes above the main search results.
The ordering of the paid listings depends on other advertisers' bids and the "quality score" of all ads shown for a given search. The quality score is calculated by historical click-through rates and the relevance of an advertiser's ad text, keyword, and landing page to the search, as determined by Google. The quality score is also used by Google to set the minimum bids for an advertiser's keywords.In 2002, engineers at Google took the concept of pay-per-click search results and turned it into their flagship advertising product, AdWords. The AdWords program can schedule ads for local, national and international distribution. All AdWords ads are eligible to be shown on google.com. Besides this, advertisers also have the option of enabling their ads to show on Google’s partner networks, i.e. AOL Search, Ask.com and Netscape.
In 2004, Google launched its own free web based email service, Gmail. Gmail features spam filtering technology and the capability to use Google’s technology to search emails. This service further generates revenue - by displaying ads from the AdWords service that are tailored to the content of the email messages displayed on screen.
Today, most of Google’s revenue is generated from advertising programs. For the 2006 fiscal year, the company reported $10.492 billion in total advertising revenues and only $112 million in licensing and other revenues.
Google’s growth and acquisitions
Google has acquired several small start-up companies since 2001, often consisting of innovative teams and products. The company has also begun to experiment with other markets outside the web content arena by purchasing radio advertising company dMarc and also selling advertisements from its advertisers to offline newspapers and magazines.
In late 2006, Google bought online video site, YouTube for $1.65 billion. To cash in on this acquisition, Google will display YouTube videos on thousands of other websites, with the hope of profiting from ads attached to these clips. A typical advertisement would appear as a graphic straddling the video or as a link along the bottom. To bring in high revenue, broad distribution of YouTube video clips would be extremely essential.
Google’s competitive edge against main competitor, Yahoo!
In 2003, Yahoo! acquired Overture Services, Inc (Goto.com), the company that pioneered the keyword-based “pay per click”/ “sponsored search” Internet ad service. Although Yahoo! had its search engine and search advertising technology then, they had difficulties integrating the 2 together. As a result, this would cause Yahoo! to be 2 years behind schedule to compete in the search-driven advertising business.
Firstly, Google’s AdWords service allowed customers to buy ads through a fully automated system while Overture’s did not. Secondly, Google’s AdWords has an effective way to push ads onto blogs with matching subject matter unlike Yahoo!.
Crucially, Google determines ad prominence on a web page not just by the price advertisers are willing to pay per click but also, based on how many clickthroughs that ad generated. As a result, Google responded quickly to ineffective ads by taking them off. However, Overture’s practice of displaying ads was based solely on how much the advertiser had offered to pay per click. This meant that irrelevant ads could end up at the top of the “sponsored results” column.
Conclusion
Although Yahoo! would have beat Google by buying its own top-notch search engine and search-advertising technology, Yahoo! fumbled and mishandled its execution, allowing Google to rise in stature. Thus, Google today controls nearly 70% of the search related advertising market, an industry worth more than $15 billion a year and growing at roughly 50% a year. These ads are the source of Google’s riches and the basis of its expanding power.
Yahoo! has since overhauled its Overture technology and renamed it Panama. It provides advertisers with a digital dashboard where they can manage their marketing campaigns, aim ads geographically and test their effectiveness. The new advertising platform is Yahoo!’s effort to close the wide gap with Google in the race for advertising dollars. This improvement has brought about higher clickthrough rates for the search engine.
Although Panama is unlikely to help Yahoo! catch up with Google’s system in the near term, it’s the first step Yahoo! has taken to give Google a run for their money.
Yahoo! has since overhauled its Overture technology and renamed it Panama. It provides advertisers with a digital dashboard where they can manage their marketing campaigns, aim ads geographically and test their effectiveness. The new advertising platform is Yahoo!’s effort to close the wide gap with Google in the race for advertising dollars. This improvement has brought about higher clickthrough rates for the search engine.
Although Panama is unlikely to help Yahoo! catch up with Google’s system in the near term, it’s the first step Yahoo! has taken to give Google a run for their money.
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