The Apple Corporation is a multinational company that specializes in different types of electronics, among them computer software, commercial servers, phones, and also personal computers. In 2006, Foxconn, one of Apple’s final assembly supplier in China, faced press allegations of poor working and living conditions. As a result, Apple had inspections conducted at 11 factories. Since then, Apple has conducted supplier audits of all its suppliers.
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This paper examines Apple’s ethical and social responsibilities and their impacts on its reputation. The paper will further discuss the methods Apple can utilize to make sure its standards on wage and benefits are adhered to, determine the impacts of increased prices of goods on customer purchasing behavior, and provide an analysis of Apple’s current marketing strategy.
Apple’s Current Position on Ethical and Social Responsibilities
In all its annual Supplier Code of Conduct reports, Apple states its ethical and social responsibilities. The latest report elaborated the company’s commitment to openness and transparency, accountability, labor, and human rights, worker empowerment, environment, health, and safety.
Apple has a set of standards that govern its suppliers’ ethical conduct. The company has set standards to safeguard its workers’ health and well being by establishing safety standards to improve workplace conditions. The company also empowers its workers technically and professionally.
In its responsibilities to protect its workers’ human rights, Apple has put measures to protect labor and human rights. In conformity to international standards on labor, the report limits a week’s work to 60 hours and voluntary overtime (Apple Supplier Code of Conduct, 2013).
Further, the company empowers its workers by providing free educational opportunities and training. As pertains the workplace environment, Apple strives to ensure workplace safety by improving working conditions, offering training on hazards, and working with the academic community (Apple Supplier Code of Conduct, 2013).
The company commits itself to the protection and conservation of the environment. The report states that ‘we take great care to design environmentally sound products’ (Apple Supplier Code of Conduct, 2013, p. 25). Apple commits itself to ensure that all suppliers conserve the environment: ‘we work with suppliers to make sure they are using environmentally responsible manufacturing processes wherever those products are made’ (26).
Apple has continuously been fulfilling its ethical and social responsibilities. To maintain its progress, the company conducts audits of all its suppliers. Audit results, published in the 2013 Supplier Code of Conduct reports, indicate that the company has observed its ethics and responsibilities.
Audit results conducted on all its facilities indicate that 77% of its suppliers complied with labor and human rights. In instances that suppliers did not comply with the set standards, the company safeguarded the right of the employees and demanded compensation and other necessary actions (Apple Supplier Code of Conduct, 2013).
The company has so far continued to observe its ethical and social responsibilities. This can be measured by the following examples of actions taken on suppliers who did not adhere to set standards.
- The elimination of child labor by Foxconn supplier. The Apple Supplier Code of Conduct (2011) recorded a decrease in child labor cases in its Foxconn supplier.
- The termination of its business with a facility that presented falsified payroll records and provided misleading interview answers during an auditing (Apple Supplier Code of Conduct, 2011).
Impact of the Publication on Ethics and Social Responsibility on Apple’s Reputation
Although Apple has suffered press allegations and NGO criticism on its practices, it is highly ranked by its customers. The fact that, in a survey on Corporate Reputation and Social Responsibility Rankings (2010) in U.S Apple was rated six by consumers, pertains its social responsibility.
Its diversity of products also made it difficult for its consumers to adapt their consumption. This character was outstanding and acted as strength to winning consumer loyalty (Yoffie & Renee, 2010).
A report by Students & Scholars against Corporate Misbehavior found that publication of suicide in Foxconn in 2010 by various media houses and blogs did not have any effect on Apple’s revenue levels (Workers as Machines: Military Management in Foxconn, 2010, para.2). Another indication that the company’s reputation was not affected was the launch of a new product, the iPhone 4 less than four months after the publications.
The product’s uniqueness and functions led to huge sales (Diaz, 2010). The launch of the new product into the market sold the masked news on the harsh living and working conditions of workers who designed the products.
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Suppliers adherence to wage and benefits standards
In its commitment to safeguarding its standard on wage and benefits, the company can apply the following methods to ensure that its suppliers adhere to stated standards.
Application of compliance monitoring
Although an audit is conducted annually, several compliance checks would be necessary to ensure that the company’s regulations are followed. The application of announced and unannounced compliance monitoring will keep its suppliers at its toes and ensure that it complies with all stated regulations.
Introduction of strict penalties
Application of heavy penalties would make sure that suppliers pay their employees’ wages and benefits. Companies that do not want to be penalized would make sure that they adhere to the stated rules. In cases of gross misconduct, the company could terminate its services with the retailer completely by giving them a grace period with assurance or termination of services. No supplier would want to lose their contract.
Impact of Increase in Products Price to Customers
I believe that the increase in the price of products would not affect computer buying trends largely. The company has so far managed to meet the consumer demands of the public. The uniqueness and advancement of products have led to the creation of loyalty among consumers. Thus, it caters for consumer needs in the market, a factor that makes it outdo other companies.
With innovation, Apple can easily apply the value culture to its targeted customer. According to this culture, when customers are satisfied with a certain product, they would be willing to pay more for the perceived value of the product. As a matter of fact, with innovations, I strongly believe that the company would increase the selling price of its products to improve the remuneration of its members of staff.
Apple can apply the philosophy of value culture versus cost culture. This philosophy does not necessarily consider what is thought as fair, but what is competitively achievable, and especially for goods sold at a high price and relatively lower value of products made (Sethi, 2012).
Consequently, I believe that despite the competition, Apple is capable of setting new unequaled standards and price that perfectly suits its target class and at the same time generates revenue and increases the wages of its members of staff.
Apple’s Current Marketing Strategy
Apple does not rely on media advertisements marketing strategy. Its greatest market strategy is based on selling value and not the price. The product itself acts as a marketing tool and work of mouth on the goodness of the product is all that markets products from Apple. Marketing strategies employed include:
Apple has employed the use of emotional and hopeful messages to promote consumer perceptions of its brand. The Company employs advertisements that bring out peoples’ emotions. The color and presentation of their products make people want to be connected with the company. The brand represents a lifestyle, innovation, dreams, and technology power that makes many people want to relate to Apple.
Quantity versus Quality
The company’s approach to quality, seen in varieties of commodities in the market, remains ‘more quality and less in quantity.’ Apple’s ability to innovate and sustain varieties of its products to cater to consumer needs is seen as the ingestion of its products rise. They have different products offering almost the same services. A person would be spoilt for choice in buying an iPod, iPad, or iTunes.
Through its innovativeness, Apple creates a competitive environment for its rivals. The company invests in time, packaging their products. They make sure that designing and packaging is impressive and satisfactory. This has led to the introduction of impressive products into the market that would make one not think about their prices but the quality and service.
Another marketing strategy employed by the company is considering customers’ needs and creating a communication to cater for their needs using innovative products.
Apple combines the striking jargons for those who prefer, but they go beyond that and focus more on the beneficial outcomes than the customer. For instance, they do not just show catchphrases like ‘glass that it edge to edge’ retina and so on, but their presentation is more of captivating to learn not to fear.
To improve its competitive environment in the global market, Apple needs to make a more user-friendly application system. Applications that can run with its operating system can only be downloaded from an application store.
This makes its users lack the choice of varieties. Its introduction would encourage the use of different applications of its products. Android, Apple’s competitor, has products that have more distribution channels, making their products more user-friendly in terms of accessing applications.
The company should also strive to eradicate the anti-capitalist idea associating its products at high prices. This can be accomplished by introducing the production of cheap and quality merchandise.
The achievement will cater to all groups of interests in the market. Android, a vital competitor in the market, has products retailing at from 65$ to 500$. Android has created a general impression in the society that the company recognizes all groups of people. As a result, it serves people from different economic capabilities.
Apple’s achievements root in their competence in innovativeness. This has led to consumer satisfaction. The company offers products that cater to the technology needs of the existing marketplace. The originality of their products also increases consumer consumption rates. Originality also makes consumers increase their confidence in the company’s quality of merchandise.
Apple Supplier Responsibility: 2011 Progress Report. (2011). Web.
Apple Supplier Responsibility: 2013 Progress Report.(2013). Web.
Corporate Reputation and Social Responsibility Rankings. (2010). Web.
Diaz, J. (2010).“iPhone 4: The Definitive Guide.” Web.
Sethi, P. (2012). Two Faces of Apple. Web.
Workers as Machines: Military Management in Foxconn. Students & Scholars Against Corporate Misbehavior. (2010). Web.
Yoffie, B. & Renee, K. (2010). Apple Inc. in 2010. Web.