Rts For The Mac

Posted : admin On 2/1/2022

For many years, Apple’s Mac has had a solid run in customers buying computers from Apple. In the last year, Apple has continued to sell over 5 million units per quarter. On the other hand, Windows PC sales dominated pretty much the rest of the market. In the last quarter, according to Gartner, Lenovo sold 18,310 million units, HP sold 15.446 units, and Dell sold 10.827 million PCs. Thanks to demand during the pandemic, Apple sold 5.513 million Macs in Q3, up 7.3% over the same quarter in 2019.

While the Mac has never been a major threat to the big PC makers to date, they still watch Apple closely, especially for any innovations Apple may add to the Mac that might impact the market and, ultimately, their future designs.

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But when Apple announced that they have moved on from Intel’s CPU’s to their own, the PC makers have become even more interested in Apple being a potential threat to their PC dominancy.

The biggest reason is that Apple now controls its processor destiny as well as its cost, to a degree. Conservative estimates for a Core i7 processor from Intel cost as much as $80-$90+ per chip. That, along with Apple’s premium pricing model, always kept the Macs well over the same laptop’s price from computers in the Windows camp using the same processor.

For Windows laptop makers, their sweet spot for most of their profits come from making laptops in the $599-$899 range. While they all make Chromebooks priced mostly under $400, margins are slim to none. That is why most of them try to pack as much technology as possible into their laptops in their sweet spot range and market them aggressively. Of course, they all sell even more expensive laptops, but most of the profits and volume come from products in the $599-$899 range.

Apple recently announced a MacBook Air with 256 gigs of storage for $899, the only MacBook to even touch the high end of the Windows PC maker’s sweet spot. But this uses a low-end Intel Core i3 processor and has only eight gigs of memory. Dell sells at Latitude 3510 laptop with an Intel Core i7 processor and 500 gigs of storage for $899.

Apple has invested a great deal in their processor design. Their new A14 Bionic chip is expected to be on some of their laptops, perhaps before the end of the year. Apple has most likely already amortized some of the costs of their designs and using their processors, and they no longer pay the Intel tax.

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This shift from Intel to Apple’s homegrown processor has some Windows laptop vendors more worried about Apple potentially threatening their core laptop business. The two price points they are the most worried about, should Apple decide to be more aggressive, is in the range of $799-$899 and using their most powerful A14 Bionic processor. Note this article from Ben Bajarin analyzing how a lower cost Mac entry point could dramatically increase the Macs PC market share.

There is a sense that should Apple offer a Mac in this power and price range; it could pressure their bottom lines. Apple has a great marketing machine, and they are showing more marketing focus on the Mac these days.

Suppose they make a lower cost/higher performance Mac that broaches on prime Windows laptop territory. In that case, it can impact all of the traditional Windows laptop vendors.

This issue is causing some of the PC forecasters to struggle with 2021 forecasts. Apple has not said when we would get our first Mac’s with an Apple homegrown processor, although there are rumors that Apple might hold another event in November to launch the first models.

A more likely scenario is that they launch A14 laptops in early Q1 and market them aggressively. If so, Apple could increase its Mac’s unit sales and potentially decrease some Windows PC sales in the near future.

I have had many discussion’s with Windows Laptop vendors over the years about Apple. These talks were always about Apple, not threatening their overall market position, especially in corporate markets.

Only in the last three months, since Apple announced they were leaving Intel and moving to their own silicon, have I heard a potential concern about Apple making a bid for what is their sweet spot.

Rts For The Machine

Without knowing what Apple will bring to market with its chips and its pricing, it is hard to forecast Apple’s Mac growth at this time. However, their competition is rightly concerned about an Apple move in its direction and will be watching Apple closer than in the past.

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In January, MAC Cosmetics, like many beauty brands, was relying on revamped standalone stores to create one-of-a-kind destinations for its specific set of shoppers. Through exclusive product, services and events, these stores offered a way to nail that one-to-one relationship with customers. But that, of course, was pre-pandemic.

Stores that sell beauty (with the exception of essential doors) first shut down in March, and those that have reopened have now had to contend with strict safety standards that take the so-called surprise and delight out of beauty shopping: There’s no useable testers or sampling, and much more reticent shopping behavior. In China, where there has been somewhat of a bounceback, beauty traffic remains down 9-43% compared with pre-coronavirus levels, according to McKinsey.

While indie brands have relied on their e-commerce sites to act as community and sales hubs since Covid-19, heritage brands like MAC have gone far and wide with new retail distribution. On Tuesday, MAC announced its new relationship with QVC, launching 14 bundled kits (or 666 product options) on air, on its site and through social shopping platforms, like Instagram Shop. This new relationship rounds out MAC’s new forays in 2020; it kicked off partnerships with Boots and Asos in the U.K. earlier this year.

“We are constantly evolving our distribution footprint to make our products and collections more accessible to consumers around the world, while also introducing the brand to new consumers,” said Philippe Pinatel, global brand president of MAC Cosmetics, of the latest partnership. “QVC is a retailer that is dedicated [to] delivering the joy of discovery through the power of relationships, [making] shopping for products more convenient and accessible.”

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QVC has typically served an older customer — women 45 years old and above. But Rob Robillard, the company’s svp of merchandising culinary, electronics and merchandising operations, said MAC is an “iconic brand and a leader in the color cosmetics and makeup space.” He added, “When we have an opportunity to collaborate with a brand of this caliber, not only does our customer benefit significantly, but we provide the brand with a unique platform that fosters meaningful customer engagement, real time feedback and unparalleled reach. Our live broadcast creates an opportunity unlike any traditional retail environment which has become exponentially important this year.” Robillard on-boarded MAC onto QVC and previously acted as vp of integrated beauty at parent company Qurate Retail Group.

In second-quarter results announced in August, Qurate Retail Group saw revenue increase by 10% year-over-year to $3.4 billion, with reported growth from QVC and HSN coming from the home, electronics and beauty categories.

While QVC will be leveraged to reignite MAC’s Gen X and older audience, the brand’s relationships with Boots and Asos are aimed at appealing to millennials and Gen Z.

Asos offers an edit of best-selling face and body brands tailored to 20-somethings, and the MAC partnership aligns with our shared goal of empowering 20-somethings to confidently be themselves,” said Alex Scolding, Asos head of buying for face and body. Scolding said Asos has been making strides in the face and body categories, adding Olaplex, Lanolips, DrPawpaw, Conair and Charlotte Tilbury to its assortment just this year.

Rts Machinery

QVC may seem a surprising play for MAC, given its recent millennial and Gen Z moves — outside of the launches with Boots and Asos, that includes the brand’s debuts of its Underground drop program, AR try-on tools and regional influencer squads. But in a way, it’s to be expected since, at the end of the day, MAC is a huge brand and needs to pull many levers to maintain relevance and market share. While MAC would not share sales information, parent company Estée Lauder Companies saw full year net sales decrease by 4% to $14.29 billion from the year prior. Its color cosmetics sales declined 18% overall, and all of its brands’ makeup sales declined with the exceptions of La Mer and By Kilian, which are not penetrated as deeply in makeup.

Thus, on QVC, MAC will be leaning into its skin-care storytelling. Iris Navarrete, MAC Cosmetics vp of artist training and development, and Fatima Thomas, MAC Cosmetics senior national artist, will be leading the charge on-air on October 6 in a two-hour QVC segment. Both Navarrete and Thomas started building buzz on Facebook Live last week and will go live on Instagram later this week.

“We know MAC can bring elevated drama and intensity with our makeup, but now, it’s about being natural and having a flawless face at home,” said Navarrete. “For example, we’re mixing our Studio Fix Foundation with our Strobe Cream for more of a tinted moisturizer look on-air to help demystify our shade range and products.” While the 666-product assortment covers face, lip and eye products, Navarrete said the bulk of the assortment is through iconic franchises like the Studio Fix Foundation and Studio Fix Powder.

Historically, it’s founders, like Josie Maran, who turn the dial for QVC sales, but Pinatel is confident MAC’s artist-forward approach will work well for the platform. “We also know that consumers sometimes are overwhelmed by our large product selection, or want to self-navigate our stores and play with our products without relying on an artist for assistance. So we’re exploring ways to adapt our retail model accordingly,” said Pinatel. He compared the QVC channel to MAC’s Experience Center in Shanghai, which is a mobile-first retail concept where shoppers can navigate the entire store experience using the WeChat app.

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Rts For Mac

And though the emphasis across beauty remains on shopping online, for now, Pinatel underscored that stores are still very much a part of the brand’s holistic strategy. Case in point: the brand’s MAC Innovation Lab, which launched last week at Queens Center Mall in New York City. It is meant to be a “testing ground for MAC’s ongoing retail transformation” in the states for standalone stores.

Rts Macro

“The store is designed to create a more experiential and approachable shopping experience for beauty enthusiasts of all levels, with a range of new omnichannel experiences to help consumers play with and explore new products and styles; it includes an immersive Art Studio, Design Your Palette station and custom printing experience,” he said. “The store provides consumers with a more hyper-local shopping experience, with a product assortment and featured makeup looks tailored to the local Queens community.”