iConomics: Six things to learn from Apple
Apple has ascended to 'über-success,' and other companies could learn a lot from watching.
(Page 2 of 2)
4. Make it good, charge accordingly:Skip to next paragraph
Joshua has been managing money for high net worth clients, charitable foundations, corporations and retirement plans for more than a decade.
Subscribe Today to the Monitor
Sure, we can all give everything away for near-free and join the race to zero, but our lack of profitability for having done so means stunted research and development in the future. And then all that market share you grabbed by degrading the value of your products and services is out the window when someone creates something better. Nowhere is this more evident than in the content world. Businessweek Magazine had basically become a free online magazine with a dead and dying print circulation that was, for some reason, still paying for delivery. Bloomberg, on the other hand, had a highly lucrative data terminal business but almost no magazine presence. Guess who ended up snatching the other for almost nothing in the end? BusinessWeek had so thoroughly devalued itself that the well-compensated Bloomberg company really had only to wait, there was no reason to chase. Apple is very methodical about their pricing, they toe the line perfectly between affordable luxury and the cache that comes with a bit of exclusivity. They don't take losses on anything and they almost never, ever discount.
5. The ecosystem:
The most important takeaway from in the Era of Apple is to be the center of an ecosystem. Encouraging record companies and app developers and accessory manufacturers and wireless partners and software designers to have a stake in Apple's success was a masterstroke. Music execs and artists saw their saving grace in iTunes even if they hated their lack of pricing power - and so they've embraced it and learned to promote it and profit. There are whole clusters of applications and software businesses whose sole existence is based on the Apple ecosystem - component makers, too. When the whole village is vested in your continued success, you can almost crowdsurf your way above your competitors who are fighting it out in the mob below you.
6. Focus on the kids, the adults will fall in line:
Unlike in Europe and Asia where the elderly are respected, revered and borderline fetishized, Americans have little to no use for anyone who even limps the wrong way. We are obsessed with being youthful and emulating the young - watch these twisted families on Bravo where the moms share clothes and boyfriends with their teen daughters - or don't watch but trust me when I tell you that tens of millions of people are tuning in each night. There is a chain of mall stores called Forever 21, walk past sometime and tell me if you see anyone under 25 inside. The key here is that by hooking the kids on the Apple hip factor back in the early iPod days, the company had all but assured that adults (with real money) would be lining up for notebooks, desktops and phones one day. How many iPods can one buy for their kids before they start wanting one as well?
Those six takeaways are what I believe to be the most important from Apple's ongoing run of über-success. What are some others I may have missed?
The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on the link above.