Incisive Marketing

I came across a fascinating post over at Pragmatic Marketing the other day that I started to forward to a bunch of colleagues.  Then I realized that I had more to say about it.

As I talk to tech executives about Marketing strategies, Apple eventually comes up – almost every time.  They come up either in reference to their visible marketing (ad campaigns), their product packaging, the products themselves, or most often, the loyalty they engender from their customers.  It doesn’t hurt that more and more people I talk with are carrying iPhones.  People just don’t like their iPhones – they love their iPhones (myself included).  I hear the following refrain so often, its tempting to offer a glib reply, “We want our customers to be as loyal as Apple customers.”

In the past, I’ve offered a number of responses: 1) Well, Apple has been selling products for over 30 years.  You can’t expect your startup to attract the same kinds of enthusiastic response from customers in the three years you’ve been in business.  2) Apple owns the entire customer experience, from the software design to the hardware design to the packaging.  Very few tech companies have that kind of control.  At best, you are selling inside of another ecosystem (or maybe have developed your own), that requires compromise on a number of levels. 3) Apple is ultimately a consumer products company.  Because you sell to businesses, you can’t hope to have the same level of customer enthusiasm that a consumer has with his or her music device.

It turns out that I was partially right, but the full story is much richer. It has to do with a fanatical commitment to design – almost without serious financial consideration.  That is not to say that they won’t make compromises when it comes to delivering a product at a fair price.  Rather, it is about their investment in design.  It turns out they are willing to invest in the full development of 10 prototypes before settling on a final design.  In other words, they will often throw away 90% of their design investment.  If that sounds like a formula for success for you – well, then go for it.  For most, that kind of investment feels wasteful, and many would question the ROI.

Why does it work for Apple?  I suspect that it boils down to knowing their customer.  If you could predict that next year, there would be a sizable market for your product if it only did [fill in the blank], you might be willing to invest serious design efforts at achieving the best possible design for that product (with those features).

I am convinced that whatever market edge Apple has, comes from knowing their customers better than any other consumer product company knows theirs.  That intimate understanding of their customer gives Apple the confidence to invest millions in design.  They know they’ll get it back.

How do they know their customer so well?  That’s the subject of another post.