During Apple’s iPhone 7 unveiling, executives made a statement that got me thinking. They said from the stage that the iPhone is the device by which all others are measured. It is not hard to quantify this statement while Apple competitors butt themselves up against the iPhone. The iPhone has become the gold standard — if you can’t even draw a comparison to your product you are nothing. It is a desire to be in “the iPhone Class”. Some smartphones are, the vast majority are not. However, it is the North Star nearly everyone shoots for.
The more I thought about this, the more I reasoned it applies to all of Apple products and Apple as a whole, not just the iPhone. The Mac, the iPad, the Apple Watch, etc., are the north stars for all other competing companies. Why does Microsoft keep bringing Macs up in their commercials? It is because the product they are comparing themselves to is the king of the hill and they want to challenge that position.
Interestingly, if you recall, Apple used this tactic against Microsoft. The entire Mac vs. PC ads were, at their roots, this exact point. Microsoft was the default, the standard (we can argue whether gold or not but that’s moot). Apple, while touting the benefits of the Mac’s ease of use and other features, was positioning against Windows because it was the standard.
As you can see this works both ways but, in the end, I feel this is good for all involved.
Good for Apple
This is good for Apple in many ways. First, it helps keep them motivated. I’ve made the point many times that Apple believes their only true competition is themselves. More specifically, the last product they released. The new iPhones, Macs, iPads, Apple Watch, Apple TV, and anything else they dream up, are the gold standard for not just the industry but to Apple. This is the product which they will seek to pass in the next version. However, what great incentive for employees to also know everyone else considers your product the best. So long as that keeps them from resting on their laurels, it should act as a motivator to keep setting the bar higher with each new product release.
You will also hear me talking more about the importance of brand, globally, as consumer technology markets mature. I have been compiling quite a bit of evidence to showcase the strength of position those technology companies with a strong brand are in. Apple is one of those the data overwhelmingly points to. By having others compare themselves to Apple products, it only helps to strengthen the belief Apple’s products are the standard. I know it sounds counterintuitive but when Microsoft, Samsung, Huawei, etc., and others compare themselves to Apple, it only strengthens and affirms what the market already knows to be true.
Good for Competitors
This should be obvious but, competition is good. And honestly, competition is only just getting started. Think about where we are going with wearable technology (on wrists, in ears, on the head, in shoes, etc.). AR/VR have fascinating futures ahead. Artificial intelligence and machine learning practices to increase customer experience is just now seeing ground broken in mass market ways. We need competition in this industry and, if others are adamantly chasing Apple in all these areas, it is good for consumers.
Where my take on this may differ with others who have strong feelings about other brands is that I feel it is good Apple is the benchmark. Especially since Apple can teach them all a lesson on how to do customer service. Just take the Samsung Galaxy Note 7 debacle as an example. Samsung is probably the next closest consumer electronics brand to Apple at the moment and the customer experience they are providing is a disaster.
Apple as the standard across the board is a good bar for others to try and reach. Like Apple or not, they are good this for industry. No reasonable person could argue otherwise.
Funny, I always thought the moon landings were the standard by which Tech is measured…
“Tech” is not just computing, and the value of Tech is not by units sold. A lot of Pet Rocks were sold in the ’70s.
That may have been true for a past generation but not today. Tech is evolving to computing now as computing invades all areas of tech and non-tech.
Software is eating the world. I think Apple groks this pretty well.
Both Ben and you are myopically wrong. Almost every object made today contains at least some metal parts. Do you say, “metallurgy has eaten the world?” No.
Software is becoming an ingredient in every aspect of life. It’s moved from a specialized niche thing to a universally utilized ingredient in human activities. But saying that “software is eating the world” is very much a computer programmer’s view of the universe, (in which everything involving computers assumes a myopically exaggerated importance) like a metallurgist saying that “metallurgy has eaten the world.”
“Software is eating the world”
When all you hold us a hammer, everything looks like a nail…
Your summary “It’s moved from a specialized niche thing to a universally utilized ingredient in human activities” is a very good way to put it. We’re saying the same thing. I’m not a programmer, and I don’t take that view of the world. Computing is finally consumer facing and is now being abstracted and simplified, to the point where it will be so common that the phrase ‘software is eating the world’ becomes as silly as saying metal has eaten the world, or plastic, and so on. I also often say the screen is the computer, but I don’t literally mean the screen is the computer. I’m sure you understand that it is simply an easy way to make the larger point.
“Tech is now….as computing invades all areas of tech and non-tech”
Really? Then math has first dibs, so does English for that matter.
As a means, I can see where we are entering the final days of any work being done without a computer involved. Here the computer is simply the means (one of many) where tech is developed. I was referring to computing tech as the “end”.
Tell any architect, physicist, MD, pharmacist that what they do isn’t tech. Thank goodness for analysts,
I think this is still overwhelming true, but it is starting to slip. One used to be able to read n iPhone review without nary a mention of Android, or at most where Android may fall short in comparison. That isn’t the case any more, even more so comparing it to Samsung.
Joe
I think this happens quite a lot in markets where there is a clear market leader, especially if that leader was also strongly involved in pioneering that market.
In the markets that I’ve seen (biotech products), what often happens is that the 2nd and 3rd players position themselves as having products that are just as good or better than the leader. However, the market in general doesn’t easily believe that and hence these companies inevitably have to compete on price. Also, these companies are often too focused on matching the leader on features & sales teams, and end up skimping on customer support. Furthermore, a market position that relies only on features & price, and which fails to build a powerful quality-based brand, is very susceptible to new entrants that are willing to go even lower on price. As a result, the 2nd and 3rd positions change a lot whereas the leader stays the same.
The way I see it, the exact same thing is happening in Tech as well.
The peculiar thing in Apple’s case is that it can achieve and maintain this position even without being the leader in market share. There seems to be a strong degree of separation between Apple and the rest of the market. This may also be why Samsung is showing itself to be quite resilient to new entrants whereas the Xiaomis, Motorolas, LGs and Huaweis are experiencing a lot of turbulence. It looks like Samsung is the undisputed leader of the Android world.
” It looks like Samsung is the undisputed leader of the Android world.”
They’ve spent staggering sums on marketing, which has put them in the position of being practically guaranteed to be supported/sold by every carrier in every market in the world. That’s a high bar for new upstart OEMs to hurdle.
How/why so many formerly large phone OEMs (LG, Sony, motorola) that also enjoyed near universal support by carriers came upon such hard times is an entirely different question.
Totally agree.
The latter is complex, and although many people would be tempted to simply label it as “disruption”, I suspect a lot more was involved.
I know nokia and motorola were cases of egregious mismanagment/stupidity following corporate takeovers. I assume some of the smaller casualties involved companies unable to muster the table stakes as defined by Samsung. But surely not all of the larger companies were mismanaged. Was it just that Samsung’s gargantuan marketing budget drowned out the other companies’ publicity efforts, so no other OEM could acquire the necessary mindshare and brand name recognition?
I don’t really know. However, one thing is clear. When there is a significant technical leap, it often opens the door to a huge shake up in the market. On the other hand, without such new technologies, the status quo tends strongly to prevail.
Therefore, the only thing (other than a total mismanagement of the Note 7 fire issue) that could sink Samsung or Apple/Google for that matter, is a huge shift in technology/market. It’s not a sufficient condition since any company could adapt if managed well, but I think it is necessary since market leaders can often prevail in static markets even when management sucks.
Great website. Lots of useful information here. I look forward to the continuation.