I would like to share a case of success and study such as Apple, the first technology company that reaches a trillion dollars. And … Why am I interested in sharing it with you? Well, because it is a company that was born as an enterprise and thought out of the box always looking to be disruptive or different in the market, and good. In these times it celebrates being the most expensive company in the world.
In this way Apple is established as the largest company by market capitalization after reaching the trillion dollars of valuation. The “apple” company easily leads the market ahead of Amazon, Alphabet, Microsoft or Facebook.
Apple is the first American firm to get a valuation of a trillion dollars, but far from being the first globally, the story keeps examples in various parts of the world. If we adjust the inflation of the dollar to the current value, there are already five companies that have reached this figure, as The Netherlands Company of the East Indies (VOC) reached a total market value of 78 million Dutch guilders at the beginning of the 17th century. The second company was in 1911, the government of the United States ordered the departure of the almighty Standard Oil, of John D. Rockefeller, on the understanding that it operated with a monopolistic structure. From it came about thirty companies, including ExxonMobil, Chevron, part of BP and Marathon Petroleum. If all these firms joined today, they would surpass the trillion dollars, which could be a fair valuation for the former dominator of the crude market. The third company with the highest valuation in history is PetroChina, which reached a value of 1.7 billion dollars today (1.4 billion euros). The price of crude oil went from $ 20 a barrel in 2002 to $ 140 in 2008. The fourth is Saudi Aramco, the Saudi state oil company, is the world’s largest oil exporter. Its current valuation is 1.5 trillion dollars (1.2 trillion euros), 50% higher than Apple itself.
Apple is the world champion of innovation, it is a money generating machine. I would say that it handles a lot of cash flow and does not know where to invest it, because there is nothing more profitable than itself. The palpable sample of the incredible capacity to generate wealth that technological companies have, the leaders of the new economic model. And, most likely, Amazon, Alphabet (Google), Microsoft and Facebook will follow.
Apple has shown that you can make culture (with the products it sells) of electronic technology. The iPhone has become a cultural icon of the global era of software and hardware integration with the purpose of selling expectations to its “fans” (users). While the dynamics of consumer electronics has been, for more than 30 years, the incorporation of ultra-tiny functions and devices, Apple is able to compete in design and user experience, in a sector traditionally thought through engineering and electronic control. In this way, Apple has been able to devise and innovate by imposing new rules on consumers of global electronics.
A few years ago it was a brand consumed by someone who had a special interest in the almost romantic development of its operating systems, but, today, many of you have an iPhone, an iPod, a Macbook …
It is clear that, in one way or another, Apple has been a real revolution in the technology industry. But why, exactly? Some people consider, as we said before, that the company has managed to take a sober look (the development of hardware and software) at a precious, almost sentimental level, in which the focus on the user experience is the most important for the company , which causes emotions that take on a new dimension. However, there are also some who think that Apple is, above all, a great marketing company.
It seems that the big technology companies like Google, Apple, Facebook, Amazon, Microsoft will be consolidated. Behind, new waves of unicorns will come (start-ups that have already exceeded the $ 1000 M valuation, which will go public soon). Great investment opportunities are being generated.
If you had invested $ 10,000 in Apple shares in January 1981, when the company went public, today it would have a capital of $ 3,820,000. If it had done so in October 2001, when Apple released the iPod, today it would have $ 1,480,000. If I had waited for the iPhone to launch, in June 2007, today it would have multiplied by 10 its value (up to $ 101,058). And, if you had invested that amount during the iPad launch (January 2010), your savings would have revalued to $ 65,862.
Factors that make Apple more profitable than other technology companies
We all know that Steve Jobs was a genius, but beyond his innovative and management skills, there are a number of factors that made his company a profitable business.
- All products are made based on the fact that Jobs represented the real consumer. The engineers created the Apple products for themselves and Jobs was the “chief use”; so design is a priority.
- The use of products has to be easy. While design is an important factor in any product Apple makes, if it does not have an easy use, it is considered to have no value for users. All products must be intuitive and easy to understand and learn. Apple is the only company where ease of use is more important than the product itself and makes this a fundamental objective of its approach to create anything in the market.
- They seek to make everything very simple. Apple does not have 5 Iphone models for you to choose, it is only one. While this may seem limiting given the amount of smartphones available to users, it is the opposite. Consumers constantly say that being able to choose is pleasant, but in reality they want the process of choosing a product to be simple and not complicated by the large number of options. Apple understands this perfectly and has not been tempted to add more models to their products; this makes buying one of your products simple.
- It offers an excellent service and customer experience. In this way, Jobs understood one of the greatest riddles of technology: although you create products that are easy to use, the variety of things for which people need technology often creates complexity. This is why users of all levels need help all the time and Apple used that factor in their favor. It is not strange that 50% of the people who buy their products are new consumers. Apple products are easy to understand and use, but if you have a problem, they can take care of it in your stores or by phone quickly.
- Apple can create a product only if they improve it. As Jonathan Ive, Apple designer, said: “Our goals are simple, design and make better products. If we can not improve something, we will not do it. ” Clearly, this company applied this thinking first with the Ipods, then with the smartphones and finally with the Ipad.
- Apple stays at least two years ahead of its competitors. While those who compete in the market just enter with competitive products, Apple is already working on products that will be released within two years.
- These six principles may seem a bit simple compared to that they have incredible software, design and a powerful ecosystem of content, apps and service as part of the company’s successful equation, but over time they have been the key to that they achieve success, and as long as they stick to them it is very likely that Apple will continue to grow and be disruptive.
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