Case study: How Apple builds everything around simplicity

Posted on Posted in How to Guide for Marketers

In 1996, the Apple brand bordered on bankruptcy. It was just another computer company without any real point of difference. Steve Jobs had been gone for over a decade. Years of overlooked opportunities, flip-flop strategies, and a mind-boggling disregard for market realities caught up with the company. The Windows 95 launch by Microsoft had severely eroded Mac’s technology edge. Apple was rapidly becoming a minor player in the computer business with shrinking market shares, price cuts, and declining profits.

Apple looked like it would not survive, as it was a poorly run organization through the early 1990s. Executives made terrible decisions with inconsistent strategies and, most importantly, there was no brand idea for what they should be. After Steve Jobs came to Apple in 1997, he shifted the focus to rebuilding around the  brand idea of “Apple makes technology so simple that everyone can be part of the future.” Steve Jobs took a consumer-first approach in a market dominated by an obsession with gadgets, bits, and bytes.

 

How the five elements of smart strategic thinking show how Apple completed its turnaround plan:

1. Set a vision of what you want

  • Apple’s vision was to make it easy to get everyone to be part of technology in the future. The main issue was how to create brand fans then mobilize them to spread the word to the masses.

2. Invest resources in a strategic program

  • Apple invested and aligned everything behind a brand idea defined as “Apple makes technology so simple; everyone can be part of the future.” Apple uses this brand idea at every touchpoint, including the brand positioning, communication, innovation, purchase moment and experience.

3. Focus on an identified opportunity

  • For decades, Apple consistently focused on empathizing with—and taking advantage of—the consumer’s frustration with technology. In the 1980s, Apple attacked IBM personal computers as being too complicated. In 2005, they used “I’m a Mac, and I’m a PC” advertising to attack Microsoft. Each time, Apple used its “consumer-first” mentality to transform leading-edge technology into accessible consumer technology.

4. Leverage a breakthrough market impact

  • Apple takes a fast-follower stance that takes current technology and makes it simple to use. Every platform, including desktops, laptops, phones, watches, tablets, and music streaming delivers the brand idea of simplicity.  Apple deploys high profile launch hype to use vocal Apple advocates to spread the word to their friends.

5. Performance result that pays back

  • Apple created a consumer bond with their brand fans to enter new categories. On top of that, Apple is now the most beloved consumer-driven brand, with premium prices, stronger market share, sales, and profits. They used brand love to help drive a remarkable 40x revenue growth over 10 years, skyrocketing from $5.7 billion in 2005 to $240 billion in 2015. This rapid growth helps cover the high costs of advertising and R&D, giving them very healthy operating margins, up over 35%. All this strategic effort has increased their market capitalization approaches $1 trillion.

The Apple brand plan

If you took the strategic thinking model and began to outline a brand plan for Apple brand, these would be the core elements:

  • Vision: Apple wants everyone in the world to be part of the future.
  • Goals: Continue aggressive sales growth, geographic expansion into China, launch a major new consumer-friendly technology each year.
  • Key issues: 1) How do we convey Mac’s superior user experience versus the traditional PC? 2) How do we enter the music industry and increase the availability of online music to support our iPod?
  • Strategies: 1) Apple will launch a full communications assault to challenge the PC/Microsoft Windows dominant position by finding flaws in the PC to contrast with Mac computers’ simplicity to steal significant market share by enticing frustrated PC consumers to buy a Mac. 2) Apple will launch a full assault against the entire music industry with a disruptive innovator stance to show how iTunes provides higher quality digital music on your iPod much cheaper, faster and smarter than CDs to gain an entry point into the music industry.
  • Tactics: TV advertising to highlight new features and challenge competitors. Launch innovation each year including phones, tablets, online music, watches and personal computers. Laugh specific products for China. Increase retail space around the world. Build out the e-commerce program.

How Apple builds everything behind the “simplicity” brand idea

The brand idea for Apple is “making technology so simple that everyone can be part of the future.”  Steve Jobs insisted they take a consumer-first mentality, as they transform leading technology advancements into “consumer-accessible” technology, helping fuel the perception among the mass audience that Apple is an innovative leader. 

Apple has done a great job in taking that simplicity brand idea and stretching it across their brand story through advertising, and their innovation plan (as they have entered many new technology categories). They have also used their brand idea to guide how they manage the purchase moment (to make sure their retail outlets are easy for consumers), and how they create happy experiences for consumers. And when they don’t nail the ideal consumer experience, they go out of their way to help out. They also have the genius bar and on-site lessons, which help increase the knowledge of consumers.

The other beauty of having a crystal clear brand idea, is that everything that goes against that brand idea almost acts like an obvious virus. Looking below, here are four examples of where Apple is missing out on “simplicity” which puts the brand idea at risk. These should trigger action plans to build into your brand plan.

Apple’s advertising has delivered “simplicity” since the 1970s

Apple’s advertising has been relatively consistent for over 40 years and incredibly connected with consumers. The early print ads of the 1970s, as Steve Jobs was launching Apple, talked about how we designed the computer, so you don’t have to worry about the details. 

The “1984” TV ads for the Mackintosh launch spoke about the freedom from machines. Although the message was a little ahead of its time, it fit with simplicity. 

The brilliance of the side-by-side “I’m a Mac and I’m a  PC” TV ads epitomized the brand idea by making the PC seem overly complicated and frustrating while setting up the Mac as the simple alternative.

Click below to play the “I’m a Mac” TV ads

Apple builds product innovation around simplicity

Apple has taken many failed technology ideas like online music, tablets, or mp3 players, and turned them into consumer-friendly platforms such as iTunes, iPads, and iPods. With each new product, Apple uses launch hype to generate excitement to spark the enthusiasm of the early adopters who spread the word. Also, Apple has successfully taken its cherished brand fans into new categories. 

The purchase moment for Apple is very simple, including its own retail store experience

Apple uses simplicity to manage the purchase moment through its retail stores, making sure the experience is simple and straightforward. All staff carry a credit card machine and complete the transaction very quickly. No lines or cash registers. Simplicity shines through the store layout, with the genius bar for one-on-one tech questions and support and the training area to teach classes. The brand also puts every Apple product on display to allow consumers to take them for a test drive. Even when Apple products are in other stores, the brand has used its power with that retailer to create a distinct store-within-a-store concept, which replicates a similar look and experience from Apple’s own retail locations.   

Apple obsesses about the consumer experience

As Steve Jobs famously said, “You have to start with the customer experience and work backward to the technology.” Apple even believes opening your Apple products should be like unwrapping a gift.

The brand wants the consumer to be able to use any Apple product right away rather than spending hours loading software or setting up your machine. Regarding product integration, Apple products work together, and they work the same way, which makes it very simple for consumers when they move from one Apple product to another.

 

 

Brand Love leads to power

As Apple has achieved an extremely tight bond with a loyal mass of followers, they use the tight consumer bond to generate brand power that they quietly wield in the market. Apple’s retail network of stores generates twice the sales per square foot of any retailer in the world, yet it is a very soft-sell environment. I was recently on a double-decker bus tour of New York City, and when the bus went past the 5th Avenue Apple flagship store, half the bus stood up to take a photo. And, Apple has such a power over the supplier network with an array of engineers following extremely tight procedures. Also, they have a power over the media, generating over $2 billion worth of free media each year. Moreover, Apple fans want to work at Apple, many times giving up lucrative jobs just to be part of the brand.

Brand power leads to profit

Apple extrapolates the power they generate into profit, with their incredible financial performance over the last 15 years. And, they generate significant price premiums, relatively lower cost of goods and moderate marketing spend ratios. This holds their margins at healthy levels for a technology firm. Furthermore, Apple has entered many new categories over the past 15 years, each time their army of loyal fans has followed, moving into laptops, phones, tablets and the music business. In each segment, Apple continues to gain share to drive volumes. Finally, the higher margins and higher volumes make for a beautiful profit statement.

Even though Apple gives the perception of an extremely friendly brand who is on the side of the consumer, they are now a huge mass market corporate brand, with a market capitalization of $500-600 billion, which 2-3 times the value of companies like Coke, Procter & Gamble, Pfizer, and IBM. So, if you invested a mere $10,000 in 2005, you would have $240,000 a decade later.

Apple uses their brand idea to turn brand love into higher power and profits.

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Our playbooks will show you new ways for how to think, define, plan, execute and analyze your brand

  1. You will find new strategic thinking models and examples for each of the four strategic thinking methods, looking at core strength, competitive, consumer, and situational strategies. 
  2. To define the brand, I provide a tool for writing a brand positioning statement as well as a consumer profile and a consumer benefits ladder. I have created lists of potential functional and emotional benefits to kickstart your thinking on brand positioning. We show a step-by-step process to come up with your brand idea and bring it all together with a tool for writing the ideal brand concept. 
  3. For brand plans, I provide formats for a long-range brand strategy roadmap and the annual brand plan with definitions for each planning element. From there, I show how to build a brand execution plan that includes the marketing communications plan, innovation process, and sales plan. 
  4. To grow your brand, I show how to make smart decisions on marketing execution with chapters on how to write a creative brief, how to make decisions on creative advertising and how to lead the media choices. 
  5. When it comes time for analyzing the performance of your brand, I provide all the analytical tools you need to lead a deep-dive business review, looking at the marketplace, consumer, channels, competitors and the brand.  

You will learn everything you need to know so you can run your brand and be successful in your marketing career.

You can find Beloved Brands and B2B Brands on Amazon, Rakuten Kobo or Apple Books

Click on any of the icons above to go directly to the page where you can buy our books. 

Finding your love in the art of being different

Posted on Posted in Beloved Brands Explained

Whether it is with advertising or new product innovation, brand leaders must embrace the art of being different.

Too many new product launches follow the same formula: conduct a basic product concept testing, hope for a moderate pass, meet with sales and explain how this is almost identical to the launch we did last year and builds on the same thing we just saw our competitor do, re-enforce that the buyer hinted that if we did this, we’d get on the shelves pretty easily. Go to your ad agency, with a long list of mandatories and an equally long list of benefits they can put in the ad. Tell the agency you’re excited. They’ll tell you they’re excited as well. Ask for lots of options, as a precaution because time is tight and we’re not sure what we want. Test all the ads, even a few different endings, and then let the research decide which one is best. That way, no one can blame you. Do up a safe media plan with mostly TV, some small but safe irrelevant secondary media choice. 

 

Ah, we have our launch

You mistakenly think this is a guaranteed formula for success because it follows last year’s launch. You convince yourself that you had to play it safe because sales are down, margins are tight and you will do something riskier next year once this launch is successful. What looks like a guaranteed success will likely get off to a pretty good start and then flat-line until it will be discontinued three brand managers from now.

The best new product innovation and advertising has to be both different and smart

At some point, to a breakthrough in a cluttered market, you have to do something different enough to stand out: now, more than ever. It might feel like a risky move, but it is almost riskier not to take that chance. Push yourself to be different.  

 

smart different

Find the space that is smart and different

Smart but not different (our launch above) 

These do better in tests than in the market, mainly because consumers have seen a similar idea before. In the market, these launches tend to get off to a pretty good start—since it still seems so familiar to consumers. However, once challenged in the market by a competitor, this launch tends to falter because people start to realize it is no different at all. So they go back to their usual brand and your launch starts to go flat. This option offers limited potential.

 

Smart and different:

 

These launches don’t always test well: consumers don’t really know what to make of it. Even after launched, it can take time to gain momentum, having to invest in advertising to explain the story and you need to put in the effort to really make the difference come to life. Once consumers start to see the differences and how it meets their needs, they equate different with “good.” This new product begins to gain share and generates profits for the brand. This option offers long-term sustainability.

 

Not smart and not different:

 

These are the safest of safe, likely a complete copy of someone else in the market. This happens when the pipeline is dry. You go back into the R&D lab and pick the best one you have–even if it is not very good. They do pretty well in tests because of their familiarity. What appears safe is actually highly risky. You should have followed your instincts and not launched. This option is a boring failure.

 

Different but not that smart

This is what happens when marketers get focused on the product first instead of the consumer. This type of launch offers superior technology, but not really meeting an unmet need. So you launch what is different for the sake of being different. It does poorly in testing because the consumers do not get it. Everyone along the way wonders why we are launching. But in the end, consumers don’t really care about your point of difference, and it fails. This launch is the better mousetrap that no one cares about.

Advertising Testing Result

Push yourself to be different

Brand leaders need to figure out how to separate good from the bad. One caution is letting market research over-ride your own instincts. As Steve Jobs said: “it’s hard for consumers to tell you what they want when they’ve never seen anything remotely like it. Yet now that people see it, they say OH MY GOD THAT’S GREAT.”

As a marketer, we tracked many numbers (awareness, brand link, persuasion, etc), but the one I always wanted to know how we were doing on was “made the brand seem different.”

Whether it is new products, a new advertising campaign or new media options, always push yourself to do something that stands out. Don’t just settle for ok. Always push for great. If you don’t love the work, how do you expect your consumer to love your brand? Afterall, the opposite of different is indifferent and who wants to be indifferent.      

In case you need any added incentive: Albino fruit flies mate at twice the rate of normal fruit flies and the place where most groundhogs are run over is right in the middle of the road.  

Brand training

Our marketing training programs to help brand leaders reach their full potential

Training Video
Play Video

You can click on the arrow above to view a quick video outlining our marketing training programs

Our playbooks will show you new ways for how to think, define, plan, execute and analyze your brand

  1. You will find new strategic thinking models and examples for each of the four strategic thinking methods, looking at core strength, competitive, consumer, and situational strategies. 
  2. To define the brand, I provide a tool for writing a brand positioning statement as well as a consumer profile and a consumer benefits ladder. I have created lists of potential functional and emotional benefits to kickstart your thinking on brand positioning. We show a step-by-step process to come up with your brand idea and bring it all together with a tool for writing the ideal brand concept. 
  3. For brand plans, I provide formats for a long-range brand strategy roadmap and the annual brand plan with definitions for each planning element. From there, I show how to build a brand execution plan that includes the marketing communications plan, innovation process, and sales plan. 
  4. To grow your brand, I show how to make smart decisions on marketing execution with chapters on how to write a creative brief, how to make decisions on creative advertising and how to lead the media choices. 
  5. When it comes time for analyzing the performance of your brand, I provide all the analytical tools you need to lead a deep-dive business review, looking at the marketplace, consumer, channels, competitors and the brand.  

You will learn everything you need to know so you can run your brand and be successful in your marketing career.

You can find Beloved Brands and B2B Brands on Amazon, Rakuten Kobo or Apple Books

Click on any of the icons above to go directly to the page where you can buy our books.