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14 May 2015

Worm in the Apple

The decline of the mighty Apple has begun!

Now that I have your attention, bear with me as I humbly offer a bit of a try-hard version of How The Mighty Fall, in which business guru Jim Collins breaks down the eventual collapse of great companies he once identified as successes in Good To Great and Built To Last.

Perhaps because I am so emotionally invested in Apple, I can see that the seeds of the decline of one of the world’s greatest brands have already been sown.

According to branding masters Al and Laura Ries in their classic work The 22 Immutable Laws of Branding, a company’s brand image will inevitably go downhill when it concentrates too much of its energy on expanding or sub-categorising, rather than capitalising on its successful ventures.

Think of the affordable, entry-level cars that BMW and Mercedes have started to offer. Lowering themselves to the level of lesser rivals diminishes their luxury image in the eyes of the people who can afford (and desire) the prestige.

What about Diet-Coke? It helped the world understand that the original formula was, in fact, unhealthy.

And can you think of a single flagship product for Sharp or Mitsubishi? By generalising rather than specialising, their brands have been diluted, resulting in minimal profits for these enterprises.

With Apple, the introduction of sibling products such as the iPhone 5C, iPad mini, iPhone 6 Plus, Apple Watch and the newest updates to iOS and Mac OS, with no true product innovation, is setting this great company on its way down, I’m afraid.

Back to Al and Laura Ries: their premise is that true brand dominance relies on a company’s ability to capitalise on a category, rather than an industry or product line.

Before the iPhone, there was no smartphone; before the iPad, tablet computing was a joke. But before the Apple Watch? Companies like Samsung and Google were already right into smart wearables.

So while Apple has inevitably been able to position itself as a decent player in that space, it isn’t really THE player.

Apple is even subtly belittling its own previous achievements by proclaiming the Apple Watch “our most personal device yet”. Sure, that’s great sales-speak, but I can see poor old iPhone sitting in the corner sobbing “what about me?”!

Of course I can hear the counterarguments coming thick and fast!

Tim Cook has made Apple the most profitable company ever, and multiple reports have suggested that the Apple Watch is outselling its competitor.

While these are both huge achievements, I argue that sales figures are not truly representative of a brand’s positioning. A company’s brand presence speaks to its longevity and generational volume.

A Rolex will never become a Casio, regardless of 2015 being a digital world.

From a branding point of view, McDonald’s is in decline. Their products have grown from the original 11 – all with the same price – to 50-plus, accompanied by a price list not designed for a quick scan on your way through the drive thru.

Sure, the greatest franchise in history is still racking up phenomenal sales on a daily basis, but its brand image is now confused, because people have always gone to McDonald’s for a certain product: fast, simple and low-nutritional-value (junk) food.

Healthy eating will never be a legitimate selling point for McDonald’s, no matter how hard they try. Their non-health branding is too ingrained in us all.

Imagine if Boost Juice was to start selling fries?

Since the Tim Cook era, Apple has just been playing in the Red Ocean (with the rest of the sharks), hence the traditional competition-based scenario: faster processors, bigger screens, smaller tablets, slicker watches.

The players in this market will continue to push out more updates of the same categories, instead of inventing new ones – in other words swimming alone in the Blue Ocean.

Welcome to the rat race; the relentless pursuit of better, faster, cheaper, smoother, shinier, smaller, lighter and more mass-marketable.

It’s sad to see Apple having come down from its ‘chosen one’ pedestal of just a few years ago into the undignified bullpen where the rest of the unremarkable brands are fighting for the scraps.

Just like McDonald’s, Apple will continue to make great sales, thanks to Tim Cook’s expertise in sales and marketing. But because of his lack of focus on branding the company will eventually decline in the public eye to a point that its legacy will eventually be grouped with companies like IBM, Hewlett-Packard, Sony, Ford and Dell – a relic of the past.

I’d summarise successful branding in three words: Niche, Focus, Time.

Apple had a Niche, in creating a mobile lifestyle. It had Focus, in creating two categories (Smart Phone and Tablet) that supported the Niche. Now the challenge is Time.

How long can they remain focused and dominant, not chasing somebody else’s trend?

The Apple Watch is a dangerous one.

Mind you, if Apple creates and leads the way in a whole new category – my money is on CarPlay or ResearchKit – there’s still hope!


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