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1

Arshad Mahmood

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SITUATION ANALYSIS
iPad-2, Apple Inc.s new product made it to the international markets on 25th March
2011 after quite a lot of advertisement hype and wait. This invention easily makes
the list of the best products in the last ten years or so. The creation is a testimony of
the success of Apple Inc. and is centered more on the use from fingertips than the
hand. This sustains the road of progress that Apple has obtained after iPod and
iPhone. The Economist made an interesting comment on the cover by saying, The
enthusiasm of the Apple faithful may be overdone, but Mr. Jobss record suggests
that when he blesses a market, it takes off.
It can be inferred that Apple Inc. is doing wonderfully well at the moment. Much
of its success can be pointed to the optimization of value exploration, value
creation and value delivery. The initial level of value exploration targets the mind
of the consumer and also the ability of the company. It also takes into account the
resource space as well. On another level, the value creation is centered on getting
the profit. Here, the key element includes competency in the paradigm of business
and association with business partners. The third level is primarily based on
management and is the value delivery. The crux elements include the management
of resource, customer relationship and the business partnership.
Apple succeeds as a strong company owing to the superior central management.
This principle is centered on the management of the inventory, creation of new
product, and on how to get and sustain customers. This principle has the effect of
unifying the lines of work among the people in the production and distribution
sector. This would include the suppliers and the distributors as well. The competing
element is not the company but rather the marketing network.
When one talks about the planning of the Apple Inc. regarding the market, they
would know that it places influence on dynamism. The dynamism is the simple
sustenance of the ambitions of the company along with the transition that take
place in the market. The entire concept is based on the premise to mould the
product into a profit generating commodity that has the capacity to grow. All the
levels, in case of Apple Inc are stable and proficient in balance.
Next is the strategic planning task which is based on four elements. One of them
includes providing the definition of the purpose of the corporate. The next ones

include the strategic business units and the process of giving resources to the SBU.
This providence is done on the grounds of presence of market desire and the
capacity of the business. Apart from that the plans for new business and pruning
old ones is also involved.
EXTERNAL ANALYSIS (PEST)
Political-Legal Forces
o The variance in the legislation of countries across the globe might encourage
the morale of companies or discourage it.
o Some of the factions that would provide a more than average potential in the
market include NAFTA, European Union and other regional trade markets.
They allow good opportunities in Europe, Latin America and Asia.
o Another factor which is hampering the growth of the business sector of the
company is political instability, which is greatly influenced by terrorism.
o Another complication arises in the faction of intellectual property rights, as
the company might be in violation of patent rights non-deliberately. This
occurs because the patents are from third parties, and not an original patent.
o The companys repute would be projected in an infamous manner over the
Beatles lawsuit.
o The environment authorities place regulations on the safe disposal and
recycling as well, which have to be followed stringently by the company.

Socio-Cultural Forces
o Computer industry can flourish well on the thriving of the computer and
internet consumption globally.
o The literacy rate and the experience in terms of computer based knowledge
has increased among customers.
o The new generations emphasis on education is an integral factor, playing a
major role in the business of the company.

Economic
o A shift of growth has been observed during the last few years. Earlier statistics
showed a decline in economy and a consequent lowering of money
expenditure and investments by consumer. Situations during the current time
show some better indications for spending and profit.
o Economic recession had its effect on education sector in the US, and this has
lead to a poor sale result of Apple in the educational sector.
o Another concept affecting the growth is the exchange rate of currencies, and
the effect is further compounded with the presence of trade tariffs.

Technology

o There is an evolution in technology and people are always waiting for the next
best thing when it comes to information systems and the appliances associated
with them.
o A good incentive for the company is the access of internet globally and its
usage as well.
o There is a pretty good chance that the conventional desktop might become
obsolete owing to technological advancement and better products.
o Another aspect is the increased usage of latest tech in educational institutes
and offices as well.

INTERNAL ANALYSIS
The basic area of expertise a company has is defined in their working
fundamentals. When speaking of a brand like Apple, their proficiency lies in the
following areas:

Innovation and engineering excellence:


o Novelty and high-tech development

Creativity and design:


o Product modeling & extensive marketing

HRM policy:
o The workers and administration of HRM adds to the success of
the company

When the main area of expertise of a company features that it is at a better standing
as compared to the competitor, they have the upper hand of being a distinctive
competency - the factor that allows the business to have competitive costs. As seen
in the diagram above, these root from the companys assets and potentials and
therefore, mould their tactics, giving the company, a chance to experience
economies of scale and having the competitive edge as well. Below is a list of the
potentials and assets of Apples distinctive competency;
Human Resources:
o an effective workforce (peoples skills, practiced, informative, ambitious etc)

Technological Resources:
o advanced IT (Communication tools such as Intranet & Extranet)

Engineering & technical Development Capabilities:


o compressed lifecycle theories and producing/implementing new creations

Creative capabilities:

o constructing the computer unit, computer design etc

It is believed that the innovative, constructive and technical advancement of


Apple are the most renowned features of the company that help it to maintain the
image it has today in the computer industry as it is all about introducing and
implementing creations for peoples entertainment. In addition, these
advancements in Apple will ultimately result to be one of the most distinctive
competencies the company has, as the future for such innovations is bright when
it comes to having a competitive edge.
Internal Factor Analysis Summary (IFAS)
The Internal Factor Analysis Summary (IFAS) includes the advantages and
disadvantages Apple has by providing them remarks (analytical), a weight (0-100
each, overall sum of 100) and a rating (from 5 = very significant to 1 = not really
significant) and calculating the overall weighted score.
Internal factors Weight
Strengths

Rating

Weight

12

13

15

65

16

80

Entertainment
Packages

Adaptability

18

Comprehensive
Techniques

Creativity &
design
Innovation

Business Tactics
And products

Comments
The tactics are clearly defined
and are achievable,
comprehensive methods and
coherence with the Apples
hierarchy and culture
Apples brands are not only a
product but an exceptional
creation (artistic, the way of
living)
Known for introducing and
inventing new technology and
development, engineering
excellence
Avant-garde of the digital world,
exceptional Products (iPod,
iPhone, iPad,iLife, iTunes, etc.)
Knows target market, instinctive
User friendly, advanced graphics
and unique designs

Broad area of
expertise and
competency
Advertising skills

Flexible culture

Labor Force

Information
Technology

15

16

Producing a whole new line of


products (hardware, software,
peripherals, etc.)
Extensive marketing, affiliating,
renowned brand.

Supports innovation of new


ideas, provide power of
autonomy, decentralized
responsibilities
36
High skilled
workers,
efficient,
Powerful HRM
Head of the internal
communication industry, online
facilities for customers

Business
enforcement,
commercializing

20

Has trouble in making money out


of new inventions, pays little
attention on new ideas for
business models
Because of the low market share
of PCs, the company finds
difficulty in being profitable.

Insufficient critical
size

12

Incompatibility

11

44

Incompatibility with Wintelstandard deters customers and PG


producers

Expensive
hardware and
software

Lack of realism

Highly priced products of Apple


than comparable ones. Introduced
"reality- distortion-field", Lack of
consistency with economic
existence
The economic realities are
inconsistent

High maintenance
costs

32

Expensive marketing, R&D, and


production costs as well as they
are unique products

Deficient
developers

If compared with Windows, Apple


has 300,000 developers Whereas
Windows has 7 million

Dependability on
chosen providers
and producers

Circumscribed main suppliers,


high customer demand and low
productivity (Contract customers)

Low level of
Specialization

Market full of competition at


different levels and threat from
partners as well

Total

100

Resources

Build

Shape
Competencies

Strategies
Build

Capabilities

Competitive Advantage
High Profitability

PORTERS FIVE FORCES MODEL of APPLE


Threat of New Entrants

that the tech should be cost effective. That being said, there are certain concerns for a new business in the form of compa

Bargaining Power of Buyers


argaining Power of Suppliers
Low Customers have a plenty of options to buy in less price taq and the best in quality a
acity to increase the price tag of the components at will. This puts Apple in a tight corner, since its suppliers are limited. H
Rivalry among Competition

comes to the market pie, every one wants the larger share; so there is pretty fierce competition among the established co

Threat of Substitute Products

aspect that is going to affect the growth of PC companies is the presence of newer and popular gadgets like HDTV and scre

SWOT ANALYSIS

Strengths:
o The worlds most successful and most
recognizable brand.
o The worlds 2nd the most highly valued
company
o $6b in profits by the end 2010
o Over 30 year existence
o Brought a lot of changes in the computer
industry
o 58% of the flash player market,
o Apple held 90% of the hard-disk player
market share in the U.S.
o 9.7% personal computer market in the
U.S.

Weaknesses:

o Top management style drew significant


criticism
o Poor sales support on corporate
accounts
o Industry analysts were skeptical of
Apples foray into retailing
o Apple is concentrating better on its
company-operated stores rather than its
reseller.

10

o Successful online store


o A competitive advantage with respect
to retail because of how the company
handled its people.

Opportunities:

Threats:

o iTunes grew substantially and as new


editions will be created, its capabilities
will be increased
o Rapidly increasing Apple stock price
o Up -gradation of Apples all products
and brands
o Apple is pairing high definition TV with
Apple software as an alternative TV settop box
o Mapping of product plan including three
new promised (yet to reveal) products in
2012.

o Steve Jobs health


o Increased competition most notably
Dell, Hewlett-Packard (HP), Microsoft,
Nokia and Sony
o Resellers are not happy because of
Apple retail policy and spending
lavishly on its store as consumers pull
strategy.

MARKETING OBJECTIVES

iPrint

11

iPrint Brief Description


The Apple iPrint is all-in-one printer, which offers the full scale of handy features
for home and office to enjoy. Have you been taking some great photos using your
iPhone but haven't bothered to print them out because of the hassle of connecting
your phone to the printer? This all-in-one printer solves that problem with ease.
The Apple iPrint now provides the facility to print photos wirelessly from any
electronic Wi-Fi device. It is the best printer for the professional or amateur
creative or for the businessman who needs to print some print or photos from his or
her iPad to complete that big presentation.

Worry no more if you want quality of your print task. iPrint offers individual ink
wells for high-quality printing. This technology offers a laser-like print quality.
This high quality features allows to print high-quality pictures all while saving that
ink for regular black and white text files. This feature also lower ink cost, just have
to replace the ink that is running low rather than the entire set. This technology also
generates less waste in our landfills, which, coupled with the Energy Star badge
that this all-in-one printer is toting, makes this printer a great choice for those who
are concerned about being "green."
iPrint SMART objectives
Objectives for Profitability

12

o To attain a 23% return on capital employed by May 2013.

Objectives for Market Share


o To acquire 5 - 9% of the market for all-in-one printer by December 2013

Objectives for Promotional


o To amplify trail of iPrint 30% of the target group by January 2014.
Objectives for Survival
o To endure the current economy recession till January 2015.
Objectives for Growth
o To enlarge global availability of iPrint with operational cost from $200,000 in
2012 to $400,000 in 2014.
Objectives for Branding
o To build iPrint brand the ideal brand of home and office executives in North
America and Europe, Japan by March 2014.

MARKETING PLAN
Segmentation of the market
iPrint market segmentation should be the method of separating the entire market
into several smaller, internally homogeneous groups to reap the following benefits
of market segmentation.
iPrint can compete more effectively by allocating resources efficiently to
specifically defined and selected markets.
iPrint can grow rapidly by developing strong positions in specialised market
segments.
iPrint can reach fragmented markets that splintered from once homogeneous mass
markets.

The process of market segmentation for iPrint can help:


o Explore the existing want for the current and potential market
o Explore differentiate among the segments for characteristics
o Explore the latent of the segments and how fine they are at present being happy.

Characteristics of useful segments can also help iPrint to:


o Be measurable.
o Be accessible
o Be a large enough to be profitable.

iPrint Ultimate consumers and business users - the first cut.


o Ultimate Consumersthey buy iPrint for their own personal use
o Business Usersthey buy iPrint to use in their businesses
These two iPrint markets have distinctively different needs, wants, and buying patterns.

13

iPrint Segmentation Bases


Segmentation Basis

Possible Market Segmentation

GEOGRAPHIC
Region

United States, Europe, Japan

City or metro area Size

Urban-rural

Climate

DEMOGRAPHIC
Income

Population under 25,000; 25,001 100,000; 100,000 500,000;


500,001 1,000,000; etc
Urban, suburban, rural
Diverse

$25,001 - $50,000

Age

Under 25 50 and over

Gender

Male, Female

Family life cycle

Social class

Education

Occupation

Ethnic background

PSYCHOGRAPHIC
Personality

Young, single, young-married


Upper-middle, upper-lower
College graduate
Business professional, artists, designers, illustrators working in art
industry
Diverse

Ambitious, self confident, extroverted

Lifestyle

Activities (travel, sports); interests ( modern art, reading, documentary,


photography, film); opinions ( capitalism)

Values

Self-respect, excitement, fun and enjoyment in life, self-fulfillment, sense


of accomplishment, being well-respected.

BEHAVIORAL
Benefit desired

Quality prints, impressive reports, inspiring presentation


Semi-heavy user, heavy user

14

Buying situation

New buy, Modified re-buy, Straight re-buy

TARGET MARKET
iPrint recommended target market strategy should be Aggregation strategy
which is also known as mass market strategy, undifferentiated strategy; because
iPrint of Apple likes to treat its total market as a single segment and develops a
single marketing mix to reach as many of those customers as possible. The total
market is the iPrint target as it is for the rest of Apple brands. Therefore, iPrint
will develop a single market mix and reach most of the customers in the entire
market. Apple is offering a single printer for the target audience it will design
one pricing structure and one distribution structure system for iPrint; and it will
use single promotional programme aimed at the entire market, which is also
known as shotgun approach (one programme to reach a broad target).
An Aggregation strategy has been offered to Apples iPrint because it is
evaluated that regardless of differences, the majority of iPrint customers in the
total market is expected to respond in very similar fashion to one marketing mix
as in case of iTune, iPod, iPhone and iPad.
The strength of a market aggregation strategy for iPrint brand is cost
minimization. It enables Apple to produce, distribute, and promote iPrint very
efficiently. Producing and marketing iPrint for the entire market means longer
production runs at lower unit costs, Inventory cost for iPrint will be minimized
because iPrint will be offered in two colours (black and white). Promotion costs
will be also minimized because the same message will be transmitted to all
customers.
Like always the strategy of market aggregation typically is accompanied by the
strategy of product differentiation in an Apples marketing programme. iPrints
product differentiation will be noticed by the customers because it will
distinguish iPrint from competition, who are offering their brands to the same

15

aggregate market. Through differentiation Apple will create the perception that
iPrint is better than the competitors brands and to create a preference among
customers, will help to success to reduce price competition.

Education 20%

Creative 45%

Business 25%

Consumer 10%

16

POSITIONING AND DIFFERENTIATION


Stylish
Quality

Total
solutions

Innovative
Originality

Positioning
If one were to explain brands, one could say that the have personalities to them.
You can associate adjectives of human personality like trustworthy, exuberant,
cognitive, etc to them as well. This very idea of personality is shared between the
consumer and the product. You can use this concept of personality to accent the
features of your product. One can note that the customer deflection rate in Apple is
quite low, and this is owing to the reinforcement charm that they are able to create
through the personality of their products. This model results in the lowering of the
experience, which leads to higher value. With low cost and high value, the
company is able to churn out more profit and be efficient as well.

iPrint positioning is set to be the act of crafting the Apples offering and image to
occupy a distinctive place and choice in the mind of the target market.
Value Proposition
iPrint, Apple

17

o An innovative printer that provides the quality and extravagance


printing solutions with a joy of originality.
Differentiation
Differentiation strategy is always the main focus to Apple in all of its SBUs. The
main theme of this strategy to the Apple is to compete in several niche markets by
offering diverse but unique products. Apples iPrint will do the same keeping in
mind superior quality and innovation, the hallmark of the company.
Apples iPrint like rest of the companys SBUs will be the most beautiful printing
machine, which will also get rid of the concept of being only a commodity type
product. The iPrint will defiantly to attract Apple Computers biggest segment
world-over, creative people working in advertising and media world to create outof-box big ideas.
iPrint will also attract another Apples segment in the education sector. Apple
computers have been classified in the sector as teaching and learning friendly
computers because of ease and diversity they provide. Differentiation of iPrint
will be based on the same theory to provide ease of operation.
In the consumer market and business sectors Apples iPrint will the protg of
Apple computer with tag of innovation with state-of-the-art printing facilities.
Apples iPrint using such strategy will carry greater appeal to consumers
psychological desires so the potential customers will feel no hesitation to pay
extra for the printer.

18

Perceptual Map
Quality

iPrint

Innovative

Traditional

Functional

Marketing Mix
Product
An innovative printer that provides the quality and extravagance printing solutions
with a joy of originality
Price
It is easy enough to determine the high quality product and its high price nature.
This high price nature might be deemed as a barrier to the general population, yet
Apples iPrint is able to achieve its target. The reason is the targeted approach
towards the education and graphic professional community.

19

Promotion
iPrint like any other Apple SBUs has relied on TV for its primary mode of
advertisement. It has planned collaborated with other multi-national global brands
to come forward with commercials. The ads with other global brands similarly like
Pepsi are for the promotion of its iTunes store and can be seen on the homepage of
the Apple website as well. Another approach one can work on is the switch
approach, in which the user is encouraged to transfer from one popular printer
brand to Apples iPrint. Comparative analysis to be explored to influenced to move
to iPrint owing to its user friendly approach.
Placement
iPrint can utilize Apples retail strategy. The retail store step was taken in 2001, and
now there are 280 retails stores in 10 countries, with 16 percent total revenue of
Apple. An international store was launched in Tokyo, Japan. The idea behind the
retail store is to increase the consumer base. The targeted consumer would be
people who are using printers for the first time, or those who are switching. Since
they own the stores, they regulate it well enough. The lay out of the stores is such
to project decent presentation of the product and market it as well. The lay out of
the stores are as per the demand of the area they are in. This is a tactic employed to
keep the demand in check. The staff on the retail stores is experienced to provide
good customer support and feedback as well. The store provides advice/support to
customers as well. In order to support their own products, third party products are
kept as well.
One can deem these retail stores of Apple as a vehicle for iPrint marketing. The not
only have made a niche for themselves in high profile areas, but also developed
great corporate marketing and brand awareness as well. The marketing is not
shallow, and shows that Apple has more to offer than these tech gizmos and catch
adverts. In order to give a material value, one can compare Apple with Gateway,
who has similar retail stores. Another faction of marketing targets the experience of
improving customer buying at electronic stores. The consumers are given the
feeling that this would be a great venture for them. The other feature is that of
Direct Selling, which leads to better projection of products at retail stores, and
quick customer handling as well.

20

E-Business
There is a sense of equality when it comes to the online and offline operations of
Apple as a global brand. The website is also very catchy with vibrant colors and
user friendly options. Ample emphasis is shown on multimedia with the promotion
of movies, new media and QuickTime TV. There is a sense of coherence in the
website and the brands as well. So, at the end of the day what you witness is the
reinforcement of brand identity and its positioning as well. There is also a sense of
congruency in the promotion of products as well. iPrint will very well fit into the
iconic SBUs like iPad, iPod, iPhone, and iTune on the Apple official website:
www.apple.com.
e-Business marketing strategy for iPrint.
Market research.
1. Visitor trackingiPrint site can gather data about website visits
and visitors and relating that data to other information about
visitors such as demographics, psychographics, preferences, and
consumption data provided by the respondents.
2. iPrint can gain the biggest advantage of conducting research on
the Internet is the speed with which it can be completed, the
comparatively low cost, and the geographic reach.
3. ClusteringiPrint site can track the pages visited, amount of
time at a page, and items purchased by individuals when they
navigate a site, then creates clusters of visitors with similar
patterns and characteristics.
4. Collaborative filteringiPrint site can allow a site to make
recommendations regarding product offerings based on
comparisons of visitor selections and the selections of previous
visitors.

Manufacturer
conflict.

approaches

o Use the Web as a lead generator only.


o Offer different products online.
o Sell online at retail list price.

to

avoiding

internet-related

21

o Involve middlemen in online sales.

o Target different market segments.


Middlemen strategies to address Internet threats.
o Channel assemblyallows products to be shipped to distributors in semiassembled form for the intermediary to complete assembly; allows for greater
customization and shortened delivery times.
o Co-locationemployees of distributors are stationed at the manufacturers
location to arrange final shipment to customers; product is handled fewer times and
delivery times are shortened.
o Electronic middlemenfirms which make or facilitate transactions through the
Internet, but their only investment is a website (i.e., B2B reverse-auction sites).

Promotion.
Site visits are initiated by visitors and exposure is not incidental or passive.
Means of attracting audiences to iPrint websites:
o Banner ads on other iPrint websites
o Portal arrangementsfee-based arrangements for sites to receive prominent
positions on search engines.
o Sponsorshipsfor a sponsorship fee, an advertiser is given a permanent place on a
hosts site.
o Targeted e-maila firm directs e-mail to current or potential customers, inviting
them to visit a site; sometimes referred to as electronic junk mail.

22

MARKETING BUDGET
(APRIL - DECEMBER 2011)

iPrint Annual Budget Breakup

Production; 6%
OOH & Skin Printing; 7%
POS Material; 5%
TV; 38%
Activation; 6%
Events Sponsorship; 2%
Cable; 2%
Internet; 7%
Magazine; 5%
Print; 22%

23

Break Up
M
on
HEADS
th
TV ly/
Print Q
Magazine
ua
Internet
Cablert
erSponsorship
Events
ly
Activation
POS Br
Material
OOHea
& Skin Printing
Production
ku
Grand Total (Figures in PKR Million)
p

Heads

TV
Print
Magazi
ne
Radio
Interne
t
Cable
Events
Sponso
rship
Activat
ion
POS
Materi
al
OOH
& Skin
Printin
g
Produc

Ma
Jun
y
1st Quarter

Apr

Qtr1

Jul

Aug

Qtr2

Sep

Total
22.5
13.1
3.1
3.9
1.3
1.4
3.7
3
4.2
3.8
60

Oct

Nov

2nd Quarter

Qtr3

Dec

Total

3rd Quarter

5.0

1.5

4.0

10.5

8.5

8.5

1.5

2.0

3.5

22.5

0.3

0.3

1.0

1.0

1.3

0.5

0.2

1.0

1.7

1.2

1.2

0.2

0.2

3.1

0.5

1.0

1.5

1.0

0.4

1.4

1.0

1.0

3.9

1.0

2.0

1.5

4.5

4.0

0.6

4.6

2.0

2.0

4.0

13.1

0.7

0.7

0.7

0.7

1.4

1.5

1.5

0.7

0.5

1.2

1.0

1.0

3.7

0.3

1.2

1.5

0.3

0.3

0.6

0.3

0.6

0.9

3.0

0.5

1.2

1.7

0.5

0.5

1.0

0.5

1.0

1.5

4.2

1.5

1.0

2.5

0.3

0.3

1.0

1.0

3.8

24
tion
Grand
Total
(Top to
Bottom)

7.0

6.7

12.4

26.1

0.3

16.2

2.6

19.1

5.2

9.6

14.8

60.0

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25

London, McGraw-Hill
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INTERNET SOURCES

http://www 1.ibm.com/ibm/history/history/decade_1880.html

http://www.apple.com

http://www.apple.com/about/environment/corporate/corp_ehs_programs/index.

http://www.apple.com/about/environment/

http://www.kpmg.com/about/

http://www.macminute.com/2003/08/05/appleshift

http://www.macnn.com/news/21787 WSJ

http://www.macnn.com/news/23407 NYT

http://www.macobserver.com/article/2003/12/30.1.shtml

http://www.macworld.co.uk/news/main_news.cfm?NewsID=6342

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