strategy

apple news / strategy / technology — 11 Comments
15
Jul 10

The great mystery of Apple’s stumble

There are a few reasons I respect Apple as I do.

Corny as it sounds, the biggest one is that they believe in “doing the right thing.” In my experience, other companies believe they share this value, but frequently confuse the right thing with “the most cost-efficient thing” or “the least controversial thing.” Apple focuses on the customer experience and makes decisions accordingly — even when the cost is high.

That’s the Apple I know. It’s also the Apple that, for reasons unknown, has taken the last few weeks off.

The good news is, there is now a press conference set for Friday morning. We can safely assume Steve will explain what’s happened and tell us how Apple is going to set things straight. It’s important to note that this is being billed as a press conference, which is something I’ve never seen Apple do before. That means they’ll be taking questions from the assembled press, and those questions are sure to be pointed. This is brave, but also necessary. By their own action and inaction, Apple’s “got some splainin’ to do.”

I’m confident that sanity will be restored. The bigger question is, how did sanity slip away in the first place?

Personally, I cannot imagine that Apple — or any company — could possibly design antennae in such a radical way without being aware of what happens when a human hand bridges the gap.

My theory is that Apple did what they’ve always done so well in the past. They looked at the total product design and made the tradeoffs necessary to create the best possible iPhone. What they gained by this design — a 24% thinner phone that gives most users better reception — seemed like a good tradeoff.

In hindsight, of course, that seems terribly naive. Apple attracts way too much scrutiny for such things to go unnoticed. They created a lose-lose situation for themselves. It appeared that they either didn’t have a clue about antenna engineering or they tried to slip one past us. This wasn’t just an opening for the anti-Apple crowd — it was a disappointment for Apple customers used to the pursuit of perfection.

Anyone looking for evidence that Apple knew about the flaw from the start would point to Exhibit A: the bumper. A few designer cases aside, Apple hasn’t dabbled too much in cases before, yet bumpers were a part of iPhone 4 from the start. This could be perfectly innocent — it just looks suspicious given what’s happened.

So why didn’t Apple handle this better? Why would their response be an open letter (not written by Steve) that reeked of a company avoiding responsibility? For those experiencing dropped calls, the display of bars is hardly the issue. A software fix alone seemed laughably inadequate, and terribly un-Apple.

Why didn’t Apple do what they’ve done before? Steve personally responded to the original iPhone pricing fiasco by offering $100 gift cards to those who overpaid in the first three months. Why didn’t they offer iPhone 4 buyers something as substantial?

Personally, I believe lack of “substantial” has been the hold-up. That iPhone 4 open letter was their attempt to calm the torch-carrying masses at a time when they literally had nothing substantial to offer. The engineers hadn’t yet solved the design issue for future iPhones. Bumpers were back-ordered, so Apple couldn’t even reasonably suggest them as a fix. They may well have gotten themselves into a situation where there wasn’t a viable “right thing to do.”

But Steve has one power that few CEOs have. He can make things happen, even if they don’t seem possible. So I believe all the pieces are now in place for Apple to respond as we wished they would have responded earlier. I expect them to get back into to the right-thing business on Friday. It will be expensive, probably involving $50 gift cards or free bumpers to those who’ve already bought — and a no-questions return policy for those about to buy. Obviously it will also involve a plan to address the design flaw in manufacturing.

The great shame of this is that iPhone 4 is an amazing bit of technology. I have experienced no reception issues with mine. It’s one of those devices that makes me happier every day. Despite the feeding frenzy in the mainstream press and blogosphere, there is no iPhone 4 user revolt. People aren’t flooding the Apple Stores to get their money back. What we have is a huge number of happy customers being bombarded by stories telling them they shouldn’t be so happy. I’m not sure there’s any parallel in consumer product history.

I don’t mean to downplay this. The iPhone antenna issue is a problem that needed fixing yesterday. But there is an art to turning negatives into positives, and Apple is pretty good at it. I hope Apple sees this as another opportunity to demonstrate their commitment to customer satisfaction — and another opportunity to do the right thing.

advertising / creative / strategy / technology — 8 Comments
13
Jul 10

iPhone 4: the show must go on

Apple’s new batch of iPhone 4 ads come at a most interesting time.

iPhones continue to sell like, well, iPhones — yet that thorny little reception issue keeps getting more complicated. Antenna experts debate, competitors take advantage and now even Consumer Reports lobs a grenade, apparently landing a direct hit on Apple’s sense of sportsmanship.

Let the battles rage, I say. For the moment there are new ads to review, and it’s our holy duty to answer the call.

There are four new ads in total, joining the first ad that’s been running for a while now. Like that first spot, the new ones focus on one thing and one thing only: FaceTime. That’s the killer feature, and Apple (thanks to agency TBWA\Chiat\Day) communicates with the simplicity and clarity it’s known for.

There’s a ton of humanity in each of the new spots. In fact, if you don’t take them in moderation, you may suffer an overdose of humanity.

It’s an old joke in marketing that babies and puppies are the only sure-fire hits with customers. Of the four new iPhone spots, one is about a newborn and another is about a baby-to-come. Hmm.

Here’s a quick review of each of the spots:

Meet Her. A new dad uses his iPhone to give his own father a first look at his baby girl. Touching script. Grandpa plays the part perfectly. Heavy on the sap factor, but looks great. Nice touch that the beautiful baby is confined to the mini-screen while we concentrate on the bigger image of gramps.

Haircut. This is a real charmer. It doesn’t set out so obviously to tug at your heartstrings, it’s just an everyday story — which actually makes it more powerful. You don’t feel like you’ve been “played” after you see it. You totally get how iPhone could change the way you communicate.

Smile. This spot succeeds in the same way Haircut does. Not at all heavy-handed, it’s just a moment in life made more touching by iPhone. The girl with the braces is sweet and plays the part perfectly, melting under dad’s gentle pressure in the span of 30 seconds.

Big News. Unfortunately, no matter how cool FaceTime is, you can’t help but think it’s sad that dad-to-be is getting the most important news of his life via iPhone. If the happy couple has really “been working on ‘that thing’ for a while now,” I can think of a few better ways to share this moment.

One technical quibble with these spots is the hand. In Meet Her, it feels totally natural. It moves. It’s real. In the other three spots, it’s like a piece of acrylic — unnaturally perfect and motionless, save a little shifting that appears to be added after the fact. I wonder why all the spots couldn’t have been produced with the reality of Meet Her.

I imagine these ads will work well for Apple, especially in the touchy situation they’ve created with the antenna. Connecting emotionally with customers is the best insulation against damage, and that’s been Apple’s strength for eons.

I will only note that with Apple’s transition from perennial underdog to market leader, its consumer image seems to be evolving from human & cool to human & sappy. Doubtful that Apple will slide headlong into the Hallmark Zone — but when two out of four spots are about babies and fatherhood, the puppies can’t be far behind.

apple news / strategy — 10 Comments
6
Jul 10

An open letter back to Apple

Dear Apple,

Thanks for the open letter last week about the iPhone 4 antenna issue. You know I’m a lifelong supporter, and I wish nothing but the best for you. So please take this in the helpful spirit in which it is intended:

That letter was pretty dreadful.

I’m not talking so much about the content. It’s more the way you presented it — which I found very out of character for a company normally so adept at PR. Your choice of words affected how your fans and detractors think of you. And with both groups, you raised far more eyebrows than you needed to.

First, I was surprised that Steve didn’t write this letter personally, since it’s hard to imagine a topic more worthy of his attention. And then the way you tell the story just feels kind of amateurish.

Apple's own words lead directly to stories like the NY Post's

We have discovered the cause of this dramatic drop in bars, and it is both simple and surprising. Upon investigation, we were stunned to find that the formula we use to calculate how many bars of signal strength to display is totally wrong.

It’s a bit disconcerting to hear that you’re surprised and shocked. You get major points for honesty — but demerits for unnecessarily shaking our confidence. Surely you could have laid out the same facts in a far more positive way, without being shocked at your own misunderstanding.

This mistake has been present since the original iPhone…

Now you call it a “mistake,” and get into how iPhones have been falsely displaying bars since the beginning of time. You make yourself sound bumbling, which I know you are not. Unfortunately, putting it this way leads directly to headlines like the one pictured in this post.

We’re also making bars 1,2 and 3 a bit taller so they will be easier to see.

When I first read this line (not on your site), I was convinced your letter was a hoax. It actually made me laugh. This is purely cosmetic, and has nothing to do with the problem. Better to have just built this into the software fix and let it be received as a nice touch later.

It’s not like you haven’t been here before. You’ve always gone out of your way — sometimes at great expense — to turn negatives into positives. Remember when you faced a customer revolt over the $599 pricing on the original iPhone? Steve wrote an open letter, lowered the price to $399, gave out $100 Apple Store certificates to early buyers — and you ended up enhancing your image as a result.

Sometimes history is a very good thing to repeat. In this case, a letter from Steve could have cured all. He could have told us how iPhone 4 has broken all sales records, and the vast majority of owners are in love with it. He could have explained how the antenna design actually improves reception for most, and enabled you to make the phone 24% thinner. He then could have told us how a very small percentage of people are experiencing issues — but any percentage is unacceptable to Apple. To address the mistaken perception, Apple is now adopting AT&T’s newest standards for displaying bars in the software. And since the problem disappears entirely with a Bumper or any case, Apple will be giving Bumpers to any customer who requests one. It would be a hell of a lot cheaper than giving out $100 Apple Store certificates.

Done this way, CNN wouldn’t be reporting that Apple has “raised more questions than they answered.” The NY Post wouldn’t be talking about Apple admitting it had been “misleading customers” since 2007. A hundred bloggers wouldn’t be turning Apple’s own words against them. The episode would be behind us, and Apple would once again be praised for “doing the right thing.”

If only.

Oh, and by the way, no need to send me a Bumper. My iPhone 4 is doing just fine, thanks.

strategy / technology — 5 Comments
1
Jul 10

The brief life of Microsoft Kin

Not a good day for Microsoft Kin

For anyone keeping score, Microsoft’s dual-disaster Kin One and Kin Two phones managed to breathe on their own for a mere 48 days. Not even enough time to have a litter of puppies.

Sources said “disappointing sales.” One can only imagine what those numbers looked like.

It’s not like this comes as a surprise. You could smell disaster in the initial press release. I blogged once about the lunacy initially, and then again when research confirmed that the target audience wasn’t interested. But hey, I was just a singer in the chorus — these phones were ridiculed pretty much everywhere.

The big question is, how does something like this happen? How could Microsoft just put on the blinders and so enthusiastically fling itself off of a cliff?

A favorite pastime among agency people is looking at some of the wretched ads out there and wondering how on earth they ever got through all the internal checkpoints at the agency, and then again at the client. Somehow, unfathomably, blatantly bad ideas don’t always get shot down. In fact, sometimes they are lovingly embraced. Generously, we can call this human error.

But marketers hardly have the exclusive on inexcusable lapses. Hollywood occasionally serves up those delicious combinations of bad casting and bad script — movies that would be instantly rejected by any amateur moviemaker, yet somehow glide from pitch to production to distribution.

So what’s Microsoft’s problem? Untalented managers? Oblivious CEO? Bad research? Engadget is running a story about what happened behind the scenes with Kin, a story that involves a mid-project OS change and a resulting 18-month delay.

Yeah, fine. But I’m sorry, Kin was just bad casting and a bad script. Kin was based on the idea that “young socials” (teens and 20s) would spark to a less-capable phone “made just for them” — when every young person I know is lusting for an iPhone, Droid or whatever. They want text messaging, apps and games — all of which were mysteriously missing in Kin. The one thing they do not want is “My First Sony.”

Inexplicably, Microsoft thought Kin was a good idea. It wasn’t. In fact, it wasn’t even close, which is why it died faster than any product I can remember. For a company in this industry not to recognize the utter wrongness of Kin is even more unforgivable than creating it.

strategy / technology — 19 Comments
24
Jun 10

Android: thinking different

A little clarification before I ramble about Android: I think it’s great that iPhone has serious competition. Android has improved quickly. I know people who love their Droids and we’re still friends. All is good.

But Android and iPhone have different philosophies, and it’s easy to see why. Each entered the market in entirely different circumstances.

Apple made something that didn’t exist before. It was shocking. It sent all the phone companies back to the drawing board. Google entered the phone market as a result of the iPhone revolution. Their challenge wasn’t “How can we build the best phone in the world?” It was “How can we do battle with iPhone?”

Google clearly saw what they were up against: multi-touch interface, beautiful mobile OS and an App Store with a seemingly insurmountable lead. So they acquired Android. They’d acquired Android in 2005. Now they needed to acquire a guiding philosophy. What they chose was a fairly obvious one:

“We’re not iPhone.”

In effect, Android is Google’s “think different.” Don’t want to get stuck with AT&T? We’re everywhere. Apple too strict with app approvals? No approvals here. No Flash on iPhone? We got it. (Almost.) Only one model of iPhone? Androids abound.

Of course, if you’re an Apple fan you can come up with plenty of reasons why Apple’s approach is superior on all counts (well, maybe not the AT&T part). But that’s not the point. This is marketing. This is Google latching onto some negative perceptions and running with them. And it’s working pretty well for them.

One little problem. When “being different” is your guiding philosophy, “being the best” is not. Your decisions can have unintended consequences. Like this one:

Security vendor SMobile Systems just issued a report saying “as many as 20% of applications on the Android Market let third parties access private or sensitive information.” This includes access to content of email and text messages, user location, etc. Google responds that none of this can happen without the user first approving, but then adds: “we will disable any apps that are found to be malicious.”

Well, that’s the problem with being the anti-Apple. You can shun a process for the sake of being different, but the laws of human behavior dictate that malicious apps will inevitably appear. It’s fabulous that Google will disable them after they’re reported — but I doubt that will comfort those who are victimized before Google notices.

If I were Google, I’d worry about what happens when one of those sneaky apps causes widespread damage before it’s plucked out. That’s when people might start to choose iPhone simply because “it’s not Android.”

strategy / technology — 1 Comment
22
Jun 10

Dancing with Steve Ballmer

Confession: I have a secret fascination with Steve Ballmer.

Certainly not because he’s any kind of visionary. I just find it fascinating to watch the charisma-challenged CEO perform his dance with words, putting a spin on things that are no longer very spinnable.

I thought I knew the man pretty well by now, but I did have a revelation watching this CNN Money interview. Ballmer will spin his little heart out — but he does some serious cogitation in an attempt to avoid the big fib. In fact, he resists the temptation even when the Microsoft-friendly interviewer lobs a softball to which he need only reply, “Yes.” You can see his brain working hard not to say the thing that will haunt him later.

Here are are some of my favorite moments from his exchange with interviewer Poppy Harlow (who has one of the greatest names in journalism).

Poppy: You are pretty confident about where you’re going in mobile. Can you win in mobile?
Ballmer: We can do very well in mobile.

[Geez. The lady just said you had confidence. Show some!]

Ballmer: The first step is to go from declining to growing. I think we’ll do a nice job of that.

[One moment please. I’m having an inspiration overload.]

Ballmer: We have a very well, kind of, received at least, by, uh, what we call the blogosphere [ah, so that was yours — catchy!], a very well received product in Windows Phone 7 which ships this year — WHOOSH! — and we’ll take off from there.

[Right. “Well received,” but unshipped, and with no firm date set. Nice job with the sound effect too. Even Steve Jobs doesn’t do this.]

Poppy: Looking at making the technology behind the phones, but not the phones themselves — that’s the right move, that’s the way to go?
Ballmer: Well that’s where we are [this brazen talk must end!], and it certainly has served us very well in the PC business, and we’re driving ahead in phones.

[When in doubt, cling to the PC model. “The people” love that.]

Poppy: What’s your hope for phones that use Microsoft technology?
Ballmer: We’ll give people choices … one of the advantages of the PC ecosystem — PC and now the phone — is to give people a range of choice.

Well, Steve, you know I’m not going to give up on you. But honestly, you need to change a couple of things. First, you should drop this bit about phones being just like PCs. If they were, Microsoft would be leading the charge and Apple would be insignificant. Second, it’s not nearly enough to stand for “offering choice.” Apple offered choice to an existing smartphone market. The League of Android gave people umpteen more choices. We still have BlackBerry and others. We’ve got choices out the wazoo.

If you’d like to show up at the party (three years late), you’ll need more than a tired slogan. Try making a phone people can get excited about.

advertising / strategy / technology — 4 Comments
17
Jun 10

Welcome, iAds … maybe

One juicy part of the new iOS platform is iAds. Presented with much fanfare, iAds let developers put ads inside their apps, so people can plunge into an ad without leaving the app. Apple owns a burgeoning new in-app ad market, and developers own a new revenue stream.

Only one flaw with this plan: we have to look at the ads. In the frenzy over all the money this will make — for developers and for Apple — it’s easy to forget a basic fact of marketing. Nobody actually likes ads.

I’m reminded of the project briefs that were handed out to creative teams at one of my previous agencies. Every brief started with the same paragraph, which went something like this:

The customers don’t like you. They didn’t invite you in. They resent the intrusion. They wish you’d just go away. Now then … what were you going to say to them?

My point is, ads aren’t exactly the #1 draw in customers’ minds.

Sure, ads help make the world go ’round. But they’re also the number one cause of distraction and clutter. It’s not just you and me who think ads get in the way. Apple thinks it too. One of the coolest new features in Safari 5 is Reader — which allows the reader to strip the ads out of articles, making them easier to read.

So on one hand, Apple creates a whole new way to get ads into our lives. On the other, they create a whole new way to take ads out of our lives.

This gives my inner cynic a lot to work with.

First there’s the fact that Apple takes a cool 40% cut on every iAd, while they have zero financial interest in the ads Safari strips away. Second, there’s the perception that the iAd platform is so cool, the ads will be cool. Uh, right. And then there’s the idea that the added revenue from iAds will help developers keep their app prices down, or even make them free. Don’t hold your breath for that one.

Mind you, I’m not complaining — just pointing out some sobering truths. Ads are a fact of life, and Apple has done a great job of creating a rich platform they can control and profit by. I just don’t expect to be squealing with delight as iAds begin to sprout up across all my favorite apps.

strategy / technology — 5 Comments
14
Jun 10

Dell exposes itself in public

In case anyone missed the news, Dell is entering the tablet market — sort of — with a mini-5-inch touchscreen device called the Streak.

The name is actually perfect. Just as “streakers” used to run through public places stark naked, the Streak does a darn good job of exposing the real Dell: a company that wishes it could innovate, but lacks a few essential ingredients.

Let’s back up a bit to fully appreciate this one. We’ve got phones and we’ve got laptops. Apple just shook things up by putting a brand new product — iPad — in that space between a phone and laptop.

Now Dell comes along and puts the Streak in some imagined space between a phone and an iPad. Might they next put a product between a phone and the Streak? With a little luck, this could go on forever.

The Streak is too big to be a good phone and too small to be a good tablet. It is truly the Dell version of innovation — a faint echo of someone else’s good idea.

Dell’s problem is that they’re not an innovator, they’re a money-making machine. And unfortunately, they’re a money-making machine that doesn’t make any money. The revolution they created — the direct sales model — has long since been bettered by others. With an almost invisible profit margin, they can only make money when they sell products by the zillion. And that’s not so easy these days.

“If only we could be seen as an innovator,” Dell thinks, “then people would be willing to pay more for our products.” Bingo. That’s Apple’s not-so-secret secret. But wishing you could be an innovator doesn’t make you one. Dell has been wishing for a few years now, and all we get are wild colors for our laptops, me-too smart phones and a super-thin computer that costs too much and impresses too little.

What Dell really needs is a product that will stand out from their current product line. By all appearances, the Streak is going to fit right in.

apple news / strategy / technology — 5 Comments
3
Jun 10

Steve @ D8: even better than email

You know, it was really good to see Steve Jobs take questions at D8 on Tuesday. Not because he elaborated on interesting topics (which he did) — more because he did a pretty good job of being human.

It’s one thing to see glimpses of the real Steve in his responses to customers’ emails (and the simple fact that he answers emails at all). But this was far more revealing: an informal conversation with a guy most people know only from what others write about him.

Watching these videos won’t make you Steve’s best buddy. However, his off-the-cuff remarks will definitely give you a greater appreciation for what makes him tick.

A few of my own reactions to his remarks:

The thrill factor. I felt all warm and fuzzy when Steve mentioned how thrilled he was to receive an email from some guy in the UK who’d just bought an iPad and thinks it’s the coolest thing he ever brought home. This is the real Steve. He loves knowing that people love his products. Ask Michael Dell what gives him the biggest thrill.

Apple values. Steve took care to point out that Apple’s values haven’t changed over the years. I know this is true, and I know this is what makes Apple’s success different. They are not easily sidetracked, and they don’t know how to compromise. They will actually spend more to get something right. You probably know how rare this is.

The lost prototype. When the iPhone prototype went missing, Steve said he had received advice from people he trusts to the effect of “let it slide.” After careful thought, he decided he couldn’t let it slide. He’d rather quit. This is compatible with the preceding point about Apple’s values. When you let one thing slide, there will always be another and another — and pretty soon you’re making “okay” products instead of great ones. Thank you, Steve, for having conviction.

The publishing revolution. Talking about iPad’s potential impact on publishing, Steve says he doesn’t want to see us “descend into a nation of bloggers,” that the world needs great editorial. Hear, hear. Not to trash my blogging brothers, but honestly — man cannot live on blogs alone. (Whoops, two male references in a single sentence.) Editorial is hugely important.

Retiring the PC. I agree 100% with Steve’s assessment of the future for iPads and PCs (meaning non-Macs and Macs). As iPads and other devices mature, the need for PCs will fade. Those with vested interests in PCs will indeed become “uneasy” with this, and that’s putting it nicely. No doubt Apple and Steve will be attacked mercilessly for pushing things ahead — and no doubt they will be proven right in the end.

The We factor. Okay, I do have one bone to pick. Talking about how the tablet idea actually came before the iPhone, Steve broke the cardinal rule of teamwork: “Always say we, never say I.” He took an awful lot of credit there with comments like “I saw this,” “I thought that” and “then I decided” leading up to these decisions. I’m sure he’s technically correct — but in the past he has gone out of his way to be we-oriented. Watch it, Steve.

Products as “packages.” Everyone needs to appreciate what Steve said about product design. With every new product, Apple has to pick and choose which technology to include. Going with the cheapest or most popular is a very Dell-like thing to do. Apple instead seeks out the technologies that have the most life ahead of them — and Flash didn’t make the cut. Abandoning Flash surely wasn’t an easy decision. But then losing the floppy drive wasn’t either.

Let the customers decide. As Steve points out, it’s up to the customers to decide if Apple has put together the right package of technologies. If they don’t like it, they won’t buy it, and then Apple would have to rethink its decisions. If it sells like hotcakes, then they must have gotten it right. I think this is the only real answer to the critics who feel varying degrees of outrage over Flash, App Store approvals or whatever. If Apple has made some gruesome mistake, they’re going to pay for it. Chances of that happening: slim.

Good seeing you, Steve. Let’s do it again soon.

strategy — 3 Comments
1
Jun 10

Evil’s new career in marketing

From the I/O fest — Google tries to out-1984 Apple

Evil never had to look too hard to find work. It did just fine hanging out with dictators and oil companies.

Still, it never hurts to pick up some extra cash. So, as you probably noticed, Evil recently entered the marketing biz.

It showed up at Google’s recent I/O conference, playing the part of Apple. It was a juicy role, exposing Apple’s plot to suck the last bits of independent thought from our brains. Evil represented Apple’s tightly controlled mobile platform vs. Google’s wide-open Android platform.

But clearly Evil is not signing exclusive contracts these days. Just weeks before, it grabbed the lead role in Adobe’s new “We (heart) Apple” campaign. Adobe, like Google, has issues with Apple’s unbridled lust for power, and needed Evil to cast Apple in the proper light.

It’s ironic that Evil is working against Apple these days, considering Apple actually gave Evil its start in advertising 26 years ago. Evil proudly stood up and played the part of Big Brother, a surrogate for big bad IBM, in the famous 1984 launch commercial for Macintosh. Apple and Evil were all buddy-buddy in those days, so in a way it’s sad to see Evil turning on its old friend like this. But hey, if there’s one thing you can’t do with Evil, it’s trust.

I’m not normally big on conspiracy theories, but part of me wonders if Google has signed Evil to this deal just to protect itself. After being attacked for invading privacy with Google Buzz and being investigated for monopolistic practices in Europe, Evil was already giving Google that knowing wink. Creating a new partnership to go after Apple might just be the protection Google needs.

I can’t help feeling that Evil is secretly scratching its scaly head over this whole situation, and is probably just “doing it for the money.” After all, the fact that Apple and Android have different philosophies is what gives people true freedom of choice. Slamming Apple for not being like Android is pretty pointless.

Kudos to Evil for reinventing itself, but I’m not sure where it will go from here. There’s always Microsoft, I suppose. But they may be too like-minded for it to work…

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