Since now, apple was the well-known company for personal computers, mp3 player (IPOD) and some accessories. However Apple is also well known for its innovative design. Honestly design of Apple's product was one of the most powerful advantages they had above others. However
Apple is saying that is not good enough.
Summary
Apple: More Than a Pretty Face
According to the National Retail Federation (National Retail Federation Inc. is a trade association that caters to the needs of the retail industry.), consumer spending on Black Friday dropped 3.5% comparing with 2006. Also, a Master Card Spending Pulse reported that sales of electronics rose just 2.7% from Thanksgiving to Dec. 24, 2007 than the same period a year earlier. Compared to that, Apple anticipates holiday-quarter sales of 9.2 billion dollars, a 29% increase over 2006.
Design alone isn't enough.
Then, what is the main reason for this huge success of Apple, while other consumer electronics companies are relatively failing. A lot of companies tried to copy Apple. A good example is mp3 player industry. Creative Technology, Microsoft and other companies developed a mp3 players similar to IPOD; attractive design, cool behaving features and fine accessories. But most of them failed badly.
Various models of IPOD(latest version, Iphone)
What is it that these companies need?
It can be simply described as a one sentence, "More Than a Pretty Face". People now want more than just innovative design, and cool behaving feature. Ecosystem is the solution that Apple suggests. Having fine design and cool feature is not enough. They have to have the right ecosystem to back it up. They should have the ecosystem which is backing up the products, such as; content and services, software and interfaces, retail experience, Web site experience, and an army of accessories. Many of consumers Electronics Company do not have this.
Apple got a net margin of nearly 15% at the end of year 2007. To succeed like Apple, other companies need to deeply understand the customer, and their characteristics. They might need to admit that they cannot have everyone as their customers, and concentrate on the specific segment, which have to be the center people who can influence others in some ways. And target them specifically.
Macbook air, one of the latest product of apple, cool design (thickest part the laptop is lesson than a 1cm, and supported by powerful softwares, which are enough too draw attention from customers.
Opinion.
I strongly agree with Apple. Technology has been developed so and even too rapidly, that people can't even follow the speed of it's development, and design of the products are being more and more attractive. Now, these companies have to admit that cool design and features are not enough. Those things became so basic to succeed. Just like mentioned on the article, ecosystem is being important. Things that can guide people to experience buy and use their products more easily, usefully and conveniently. I analyzed Apple's access with AIDA model.
Attention: They draw attention in many ways. One of their most influencing method is their logo itself. Apple's logo is so distinct from others and easy to remember at the same time. People recognize its logo immediately after two or three times of encounter. Because it is simple and attractive, people get attractive with almost everything that has their logo. Also the design of the products did the huge contribution to it.
Interest: Apple draws interest simply with the word "different". Apple always come up with something new, something different and something unique. People get interested in their uniqueness. 92% of personal computer market is distributed by IBM compatible computers. Apple only takes 8%. However it is growing rapidly. IPOD is so unique and distinct from other mp3 players. By the differentiated feature and design, Apple pull the customer's interest.
Desire: Apple make desire to purchase their product with unique features. Apple computer uses different Operating system. There are some special programs that only run on the Mac. IPOD used to have so unique feature which is touch screen, and IPOD has more than 3000 accessories. All these uniqueness creates desire to use their product.
Action: Apple offers many service plan to the customer. Fast delivery, tremendous numbers of Apple store all over the world, convenient website, and service plans. Also they post the price of the product on the web, and all the country sell their product according to the price on the web. It can build a trust between customer and the company, by giving them an impression of safeness, makes them feel they are buying the product with the right price, they are not being fraud.
And the ecosystem comes next. Drawing a new customer is easy, because they are blinded. They don't know about the product well, and they haven't experienced them yet. However, maintaining the old customer is the hard part. They know the product, because they used it before. They are informed about the advantage and disadvantage of the products and the company. Having a right ecosystem in the place, is the incredibly efficient way to maintain the old customers. Provide a good user interface, right contents for the products, well-written instruction and online help desk, soft wares and accessories. Those are the things that help the companies to maintain the old customers, and make them to spread good words for the product and the company. In other words, use the buzz marketing.
Apple is leading the industry with innovation and creativeness. They don't just tend to enlarge the company, and expand the product line. They know that it is important to understand the customer, and understand them deeply. Apple understands: It's not about market share. It's about mind share.
Apple's logo, symbolizing the variation that can be applied to a variety of customers.
Annotation: Written by Sohrab Vossoughi, posted on Businessweek, article title: Apple: More Than a Pretty Face. URL http://www.businessweek.com/innovate/content/jan2008/id2008014_858681.htm
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