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The
iPhone is a short-term success. But some of the marketing gaffes
made during its launch may have long-term consequences for Apple.
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Some
of Apple's staunchest supporters are a little puzzled by the
marketing misfires associated with the iPhone. What's the
long-term damage? |
As the great Western philosopher Clint Eastwood said: "A man's got
to know his limitations." We never thought that would apply to Steve
Jobs. We expect mere mortals to make marketing mistakes. In some
cases they seem almost inevitable. Ignorance, hubris, and marketing
ineptitude are plentiful in business today, just as they have always
been. So we're not surprised by marketing missteps:
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The
Edsel
was a perfectly predictable marketing fiasco for a company –
actually, at the time, an industry – with abysmally clueless
marketing and communications. Ford wanted a product in the Edsel's
niche. The fact that consumers didn't want one does not seem to
have entered into their thinking.
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Sony's
Betamax
blunder was predictable, too. At the time Sony was a company of
engineers. They designed superior products and manufactured them
with flawless quality. It didn't occur to them that the product
was useless if it couldn't play the movies consumers wanted to
see. And it couldn't. Because its tapes only ran for an hour. And
while Sony was perfecting the product, JVC was signing up movie
studios for its VHS format. So Sony was stuck without an inventory
of titles. Unlike Ford, which did dorky advertising for decades
after the Edsel disaster, Sony learned fast. They bought a movie
studio so they'd never be caught without content again.
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New Coke
was less predictable. After all, the Coke CEO on whose watch the
disaster occurred had told a bunch of creatives, "We don't put the
taste into the can. You do." He understood that the "taste" of
Coke was a consumer perception, not a tangible reality. He and his
marketing director fixated so single-mindedly on blind taste test
results that slightly favored Pepsi that they lost sight of the
greater truth about brand perception. Consumers don't consume it
blind. The logo adds the flavor. If they had changed the formula
and never breathed even a hint of the change, they might have
strengthened their market position slightly. They definitely would
have avoided destroying hundreds of millions of dollars of
shareholder equity.
But all of those mistakes were made by mere, flawed, mortals. The
iPhone miscues were made by Steve Jobs, who formerly seemed to have
marketing superpowers. We thought he was the best marketer in
America. How good is this guy? This good:
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Steve took a product in a commodity category – personal computers
– and made it so cool people pay twice as much for a Mac as for
one of the undifferentiated PCs.
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His iPod single-handedly changed the music landscape. He sold so
many of the things everyone in America must have at least three.
And as an afterthought he launched iTunes and preempted the
business of selling content, too.
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He got people to line up a day in advance to buy a mobile phone.
A mobile phone, for heaven's sake! Cell service providers give the
things away for free, and Jobs had people jostling for the
privilege of paying $599 for an iPhone because it was cool.
It seemed as if Jobs could do no wrong. Until he did wrong four
times in the space of a month.
Apple doesn't have customers, it has
zealots. We've never seen their
Net Promoter Score, but we'd bet it was
somewhere in the vicinity of 100. And they jeopardized that lock on
customer satisfaction and advocacy with four inexplicable marketing
decisions that managed to offend Apple's most fervent acolytes.
1.
Just a few weeks after the faithful camped out in front of Cell
Phone City for the privilege of paying $499 for a 4 GB model or $599
for an 8 GB, Jobs dropped the prices $200. Early adopters expect to
pay to be first with the latest cool toy. But being told they had
been gouged $200 for a mere one-month head start on the
technological hoi polloi sent some of them ballistic. So much so
that Apple backtracked and offered a retroactive rebate to anyone
who'd been gouged in the last week of the inflated price.
2.
But wait! There's more. The $200 price cut on the 4 GB model was
just while supplies lasted. Because Apple discontinued it. Imagine
the Net Promoter Score of a bunch of former fervid advocates holding
a $499 cell phone that's now worth just $299, but that Apple has
decided is really not worth keeping in production. Instant
obsolescence. The lucky ones who bought theirs a week and a day
before the price cut had plunked down $499 for something the super
salesman of Cupertino decided wasn't worth keeping on life support.
A lot of money for a brief month on the leading edge.
3. Applications developers and programmers are the most fervent
members of the Apple cult. Third party apps are as natural
as...Apple pie. So imagine their delight when Apple sent out a
download that disabled iPhones when third-party apps were loaded
onto them. Now, instead of a $599 handful of leading-edge
technology, early adopters who loaded third party apps had a $399
brick. And applications developers weren't feeling the love. Jobs
backed off, and a patch was quickly dispatched to reactivate the
inert iPhones, but a lot of damage had been done.
4. Apple's congregation is made up of lock-step individualists.
Every single one of them is uniformly unique. The "think different"
ads were an idealized personification of Apple users' self image.
Imagine how pleased they were to discover that Apple's latest
breakthrough was configured to work only on AT&T's system. No matter
how much AT&T is paying Apple, it's not enough to compensate for the
loss of coolness factor Apple sustains by being linked with a
company which has one of the least-cool, most old-tech images
anywhere. And by the negative feeling it engenders by restricting
purchasers to one system.
A company built on loyalty and cool can't afford to dump on its most
loyal customers and link up with the terminally uncool. Apple's
tremendous reservoir of loyalty and coolness will get them through
this crop of iPhone blunders without a lot of damage. But it's not
the kind of stuff they can keep doing without consequences.
And, of course, they can't do it again without breaking our hearts
into little pieces and stomping the shards flat. 'Cause we thought
Steve Jobs was the best marketer in America.
Want to find out more about avoiding
marketing missteps?
Contact BrainPosse at (865) 330-0033 or
click here.
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