Apple: What Goes Up, Might Come Down

UnknownAs I write this, the stock price for Apple is exactly $500.00  As my old Finance professor would say, that means there is a 50% chance it will go above that price and a 50% chance it will go below.  It has been quite the roller coaster since Tim Cook took over the reigns of the Apple brand–the good news is that stock price is still $125 higher than when he took office 18 months ago, but it’s down $200 in the last 4 month.  What started out for Cook as a Sustaining Success might have quickly turned into a Re-Alignment.  

The Apple brand of today is still healthy, the stores are still packed and sales are still strong.  But the fear is that if Apple’s innovation over the next 18 months looks like Apple’s innovation of the past 18 months, then the Apple brand may be at its peak, no longer on the climb.

A year from now, do you think Apple’s stock will be higher or lower than $500.00?       

My hope is that Apple finds their way and regains the momentum of the brand that has surprised and delighted us like no other brand.  But my fear is they become another Sony that rests on their laurels and coasts for the next decade.  I’m a big Apple fan, typing away on my MacBook Air with my iPad mini and iPhone close by and my iMac sitting on my desk. But it sure does feel like Sony of the early 1990’s.   There’s talk of geographic expansion into China, but that might take their eyes off the real need: we need to see real innovation.  Enough of the incremental BS.  What do you have that will surprise me beyond my wildest dreams?

Five Connectors of a Beloved Brand

To be a Beloved Brand, you must have an idea that’s worth loving.  Under the Brand Idea are 5 sources of connectivity (see diagram below) that help connect the brand with consumers and drive Brand Love, including

  1. Brand promise
  2. Strategic choices
  3. Ability to tell their story
  4. Freshness of the product or service
  5. Overall experience and impressions it leaves with you.  

Everyone wants to debate what makes a great brand–whether it’s the product, the advertising or the experience.   It is not just one or the other, but the collective connection of all five that make a brand beloved.  If one of them weakens against the brand promise, it puts the entire brand at risk.

Slide1

The big idea behind Apple is complexity made simple.  Since every great brand tackles an enemy of the consumer, Apple takes on the frustration and intimidation that consumers have with technology.  The Apple brand promise is we make it easier to love technology, so that you can experience the future no matter who you are.  

Problem #1:  Has Apple Broken their Promise? 

Over the last decade, Apple has done an amazing job in creating products that take the most complicated of technology and deliver it so that anyone can use it.  Apple takes the technology out of technology so we can all benefit.  That’s right–“so we can all benefit”.  Apple is now a brand owned by the Masses.  Yes, the masses rely on the innovators for advice, but Apple caters as much to my 70-something mother (iPad owner) as it does to my 14-year old daughter (iPhone user).  

There are 4 instances in the past 18 months where Apple has gotten off track:  

  1. Apple Maps were a disaster in more ways than one.  The first week of iPhone 5 owners was largely filled with the most loyal Apple users, the innovators who will influence the rest of us.  And the maps disaster was the first major flaw of the post-jobs era that people were waiting for.   
  2. Siri remains a disaster.  Siri does not deliver the promise as it adds frustration, not solves it.  Siri is a nice little toy that combined with Apple’s auto-correct takes my enunciation and turns into words I’ve never dreamed of saying.  I end up having to re-type the mistakes of Siri, which defeats the whole purpose behind voice recognition.  If these were brakes on a car, it would be re-called for the safety of society.  It’s unlike Apple to release such a bad product.   
  3. Retina Display is not a mass play.  The launch of iPad 3 feels odd..  They kept the iPad 2 out in the market and didn’t even put the #3 on the iPad 3.    It feels like something the niche Apple brand would have done, but now that you are a mass brand, you must cater to your consumer.  
  4. Apple TV has done nothing really.  While a few friends have it, I hear no one talking about it.  A quiet Fizzle.  

USP 2.0

Strategically, these 4 innovations were some of the big plays by Apple in the past 18 months.  And where do they fall on the test of uniqueness?  The Maps puts you in the losing zone where you are competing with Google Maps in the zone where they kick your ass.  Retina Display ends up being a niche play for photographers or fussy consumers, but for the rest of us it is in the “who cares”, certainly not worth an extra $150 compared to the iPad 2.  And Siri is not on the map, because it’s just an under-delivery that while it’s an innovation that leads the consumer, it only ends up frustrating them even more.   

Problem #2:  Is Apple Still Making a Dent in the Universe?

What caused Apple to rise so fast during the first decade of the century was innovation–the iPod followed by iTunes, the iMac vs the PC, the iPhone and then the iPad revolutionized the way we interact socially.   In many cases, Apps have replaced software.   Wow, Wow and Wow!!!

Slide1

But, the last 15 months has been a period of incrementalism.  In 2012, we saw iPad 3, iPhone 5 and iPad Mini and the fear among investors is that 2013 might be iPad 4, iPhone 6 and iPad Mini 2.  Slightly better, slightly lighter, but just as expensive.  There becomes less and less of a reason to trade up.  And sadly, at risk, less and less of a reason to love the brand.  Technology is about leap-frog.  And the world will not stand still in the next year.  Brands like Google and Samsung are ready to leap.  

Steve Jobs always talked about “Making a dent in the Universe” and people bought in and followed. Apple’s beauty has always been to give us what we never imagined.  And yet, now we are starting to not only imagine it, but predict it.  Everyone saw the iPad Mini coming.  In fact, we asked for it and Apple merely succumbed to our request.  Technology is supposed to surprise us with advances that not only meet our needs but cater to the needs we didn’t even know we had.  Apple has to get that back.  

Is Apple still making a dent in the Universe?  

Problem #3:  Apple must quiet the “Anti” Apple Segment

Haters are always going to hate.  In the technology space, the innovators and early adopters are those who tell the rest of us what to think and do.  These consumers are constantly looking for the “technology fraud” and it feels as though some are starting to call Apple on it.  The Samsung advertising has capitalized on this insight, openly mocking the iPhone5 launch.  The only way Apple can shut this down is with action on the technology front.  If Apple’s next product is the iPad Mini with Retina display or  the iPad4 comes with a better battery life than this group will become even more outspoken.

There are so many parodies of Apple being shared by millions that not only mock the technique of the advertising but the incrementalism of their technology.  This only fuels the haters.  

Problem #4:  Leadership Style

When Tim Cook took on the Apple brand, people worried but became re-assured that he had been running the Apple brand fora  while.  The brand was on a high after an amazing decade under Steve Jobs, and as a leader he faced a “sustaining success” leadership challenge.  Keep the momentum going.  Can anyone re-live that visionary relentless pursuit of perfection that Jobs brought to the role.  

Now it appears that Cook faces a “re-alignment” challenge.  Cook needs to re-invigorate the R&D at Apple to push for innovation that goes beyond expectations.  Making a dent in the Universe means pushing for greatness, not settling for OK incremental-ism.  Cook has quickly fired all those connected to the Maps fiasco.  But, he has to look at himself in the mirror for wondering how it got out past him.  The pressure is definitely on.   The questions of 18 months ago are back:  

Can Tim Cook do it?   
The World and the stock market are watching Apple.

HAVE YOUR SAY:  A year from now:  do you think Apple’s stock price will be higher or lower than $500?

To read How to Create and Run a Beloved Brand, read the following presentation:

 

Brand LeadershipI run the Brand Leader Learning Center,  with programs on a variety of topics that are all designed to make better Brand Leaders.  To read more on how the Learning Center can help you as a Brand Leader click here:  Brand Leadership Learning Center

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If you or team has any interest in a training program, please contact me at graham.robertson@beloved-brands.com

About Graham Robertson: I’m a marketer at heart, who loves everything about brands.  My background includes 20 years of CPG marketing at companies such as Johnson and Johnson, Pfizer Consumer, General Mills and Coke. The reason why I started Beloved Brands Inc. is to help brands realize their full potential value by generating more love for the brand.   I only do two things:  1) Make Brands Better or 2) Make Brand Leaders Better.  I have a reputation as someone who can find growth where others can’t, whether that’s on a turnaround, re-positioning, new launch or a sustaining high growth.  And I love to make Brand Leaders better by sharing my knowledge. My promise to you is that I will get your brand and your team in a better position for future growth.  To read more about Beloved Brands Inc., visit http://beloved-brands.com/inc/   or visit my Slideshare site at http://www.slideshare.net/GrahamRobertson/presentations where you can find numerous presentations on How to be a Great Brand Leader.  Feel free to add me on Linked In at http://www.linkedin.com/in/grahamrobertson1  or on follow me on Twitter at @GrayRobertson1 or join us on Facebook at http://www.facebook.com/BrandLeadership

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2 thoughts on “Apple: What Goes Up, Might Come Down

  1. I am one those anti Apple haters. LOL. I am sitting here typing away on my PC, with my android tablet, and my android phone close by! However great article. I do believe Apple will stagnate at some point, maybe not 2013, but definitely this decade. No good thing last for ever, and besides people love trends. There is someone now in a lab, coming up with the next best thing, everyone will follow and Apple will be left behind, however not obsolete. Apple will just become another brand. But I have to give it to Apple, their marketing strategy is beyond genius.

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