August 17, 2007

Why the iPhone won

Okay, so there are loads of articles these days that claim to know why the iPhone is doing so well. Like this one. You can always tell an article's going to be a real doozy when the author pours her heart and soul into the prose. I started to fall asleep about here: "Since I began blogging about youth marketing in 2004, I have read a lot of studies that list teens' favorite brands. Apple is inevitably at the top of every brand list." Yawn. I just told my secretary to call Business Week and find out where this person went to college so I can make sure my kids never go there.

Anyway. I figured I'd write a little something of my own about the best cellphone in the world. You know, like Larry does iPhone. Or something.

Okay, so first. It's the brand name, stupid. Say that over and over until you're convinced you understand it. Because really, the device is like nine parts name and one part phone. Why else would people line up to buy a phone they had never seen before? Why else would Steve go to such bold and brash lengths to steal the name from Cisco? And how else could Apple have repositioned the entire cellular phone market? "iPhone." It just rolls off the tongue, doesn't it? I mean, who in their right mind would buy a RAZR or Nokia 6035zv590 when they could buy the iPhone? Nobody would. This simple, easy-to-say name has brought coherence and stability to a sea of terrible sounding cell phone names. There's the iPhone, and then there's everything else. And everybody knows that everything else sucks. The phones must suck, or they wouldn't have shitty sounding names.

Next, you need to understand something that's both very simple and complicated at the same time. Perception is reality. That's it. What people believe, is real for them. Listen, do you really think Steve had a working iPhone at Macworld Expo? He didn't. I was there -- I saw the vaporphone. It didn't work then, and it didn't work until the middle of June. I know because that's when I got mine. What Steve was selling at Macworld was the idea of a phone. The actual phone didn't matter at all -- it was what people thought and believed about the phone that mattered. And most of the time, ideas are more powerful than the actual products. People can take ideas and shape them and build them in their heads. That's why Steve only released the idea of the phone and not the actual phone itself. In fact, it would have been a disaster to release the phone at Macworld. People never would have bought it then.

The actual device didn't matter much at all. I mean, don't get me wrong here -- it's a great phone and I love it. But the main thing is the brand name and the customer's perception that he's getting a ground-breaking phone. In fact, customers would have understood if their iPhones didn't work exactly the way they should have at first. Because it's a first generation product, users expect glitches and bugs. That was the allure of having one of the first iPhones -- most customers want to help debug the device and be a part of the street iPhone QC team. These people are actually doing Apple's job for them, for free. And they're paying bucko bucks to do it.

There's nothing new about any of this, of course. I've done it at Oracle for about 30 years now. We sold vaporware databases to hundreds of customers, and they loved every table and every entry. You know why? Because Oracle is a great brand name and they bought the idea of a database, not the actual database itself. Apple just took that concept and applied it to hardware, which was brilliant. And sure, the device is pretty good. It's not as ground-breaking as people make it out to be, but it's functional and grandmothers can use it.

So there you go, people. You've heard it from the horse's mouth. And if you read this stuff in Business Week in a month or so, just remember where you heard it first, okay?


David H Dennis said...

I would actually say you have an interesting point, but then the advertising for the device would be based on trying to form a mystique, as it is for most products. You know, the phones roll and turn over and play dog just like most cellphone ads do.

But the iPhone ads were so simple ... they just showed the phone, as you would use it yourself. If the device was not truly groundbreaking, those ads would not have worked, and we would not have seen millions of downloads for a straightforward, 25 minute video about how the phone works, without even a Steve in sight.


Rip said...

Uhhh, sounds like alot of sour grapes to me.

Anonymous said...

The reason why he "pre-announced" at MAcworld was that they needed FCC approval. That meant it's existence would have been revealed before launch.

Apple likes to control the flow of information about new products so they HAD to pre-announce to prevent the FCC from stealing their thunder

Anonymous said...

Larry - you are right on the money. This is the biggest little secret of all major marketing campaigns. People don't want a product - they want the *feelings* that come along with a product. A lot of that feeling comes from an expectation. Define that expectation and you have defined your market.

Apple has this down to an art. They started by releasing carefully crafted rumors that rapidly swept through the craposphere - this created a sense of mystery. People began wondering about this 'mysterious product'. This built a mythos around the product.

Then using the FCC approval as an excuse to have a 'pre-announcement' - created the perfect hype building situation. As usual, Steve was selling the idea - NOT the iPhone.

Sure the iPhone is nice. But it is not amazing. The amazing thing is how well they performed the marketing. Bravo Apple! Yet again you have proven that you are light years ahead of the crapetition.