Apple Computers Channel Conflict Case Study

Apple Computers Channel Conflict

In 2003, an Apple reseller, Tom Santos, filed a lawsuit against Apple Computers Inc. . The court case alleged Apple of showing undue preference to its own Apple retail and online stores. The lawsuit claimed that Apple Computers was neglecting Apple reseller stores while shipping new goods. Many believed the suit was a result of Apple's deteriorating relationship with some of its dealers

Apple was also accused for adopting unethical business practices. The legal battle criticized Apple’s intention to divert sales to its own stores. Dealers claimed that Apple used discriminatory pricing to undercut dealers, selling products below cost in order to get customers away from independent stores. Many other resellers joined the legal proceedings. Till June 2005, the plaintiffs awaited the allotting of a trial date at the Superior Court of the county of Santa Clara, California. Over the years Apple has succeeded not because of its first-to-market strategy but because it has been able to reach customers with clever products, clever marketing, and smart distribution. Apple though claims that its intent with its retail stores program is to make the market bigger, rather limit its existing channel.

Case Study Keywords:

Apple Computers Inc, Apple, Macintosh (Mac), handling channel conflicts, Apple iPod, Steve Jobs, Steve Wozniak, Reseller, Online Store, Retail Store, Class Action Lawsuit , Hybrid channel system, channel functions, channel integration, channel leader, channel members, channel strategies, dealers, channel partners, Apple resellers association

Management Issues:
Channel Conflict and resolution
Channel Strategies and Management
Reseller Management Issues
Channel Conflict vs. Channel Cooperation
Developing flexible and hybrid distribution strategies to minimize channel conflict

About Apple Computers Inc. (Nasdaq listing: AAPL)

Apple Computer, Inc. is a Silicon Valley company based in California. Apple’s main business is computer technologies. Apple is known for its pioneering, efficiently designed hardware like the iPod and iMac. Apple’s innovations in the software segment like the iTunes part of iLife suite and Mac OS X, its operating system are noteworthy.

Apple Computers Facts and Figures:

Apple Computers was founded on April 1, 1976
Apple was founded by Steve Paul Jobs (Jobs) and Steve Wozniak (Wozniak)
Apple was founded in Jobs' garage.
Apple opened its first retail store in May 2001
Apple’s first store was opened in a suburb of Washington D.C.
Apple helped begin the personal computer revolution in the 1970s

Related Reading:
Resellers, Consumers File Suit Against Apple
http://www.thechannelinsider.com/article2/0,1895,1768399,00.asp

Microsoft's Channel Focus Appeals to ISVs
http://www.thechannelinsider.com/article2/0,1895,1833854,00.asp

Channel Conflict and Coordination in the eCommerce Age
http://omis.scu.edu/pdf/POMS-channels-2003-0402.pdf

Best Practices for Channel Management
http://newsroom.cisco.com/dlls/tln/newsletter/2002/september/part1.html