Some functions are strongly coupled and some are not. A significant rise in unemployment, for example, has domino effects. Add a little bit of slant from the media to get our attention, and things look pretty bad.
There is no doubt now. Apple’s brand and products have weathered the worst recession in memory. Tim Cook must be feeling pretty good these days that the principles Apple has lived by have proven valuable. Record non-holiday earnings are just simply phenomenal in this economy and should put to rest once and for all the whining of observers who have seduced themselves into thinking that Apple is just another computer company.
More valuable are the insights we can obtain from remembering these principles when we hypothesize about future products. Those principles are, namely,
- There is no need to diminish Apple’s brand.
- There is no need to reduce prices or offer special “sale” prices.
- There is no need for a cheap Apple netbook. (However, see Bryan Chaffin’s editorial from Wednesday.)
While it’s a national tragedy to have so many people unemployed, what Apple knows is that their customers reside on the upscale side of the 91 percent who are still employed. These consumer customers who have their own purchase authority are much more likely to replace a computer when necessary than a business that can dictate to its employees: NO NEW COMPUTERS FOR YOU!
What we’re reminded of is that Apple has inserted itself into a unique economic niche of upscale consumers who expect to use the best. Ignoring that virtually mathematical reality of Apple’s economics leads us to view Apple in impractical ways – and make bad product predictions.
Concept: MacBook touch (Credit: Gizmodo)
For example, some writers like to believe that in the bell curve of income, there is an even distribution of Macintosh customers. So whatever happens to the bottom half is going to affect Apple. However, Apple’s customer base is weighted towards the top half of the income scale, and that’s what makes Apple more recession proof than other companies.
On top of that, when people do buy a computer, out of necessity, during a recession, they realize that it may have to last them for awhile. Buying crap isn’t a good idea. It’s a time waster too.
Microsoft, having decided a long time ago, that appealing to the masses is the way to go, has a unique perspective on the profile of Americans, and that colors their perceptions about how to confront Apple with their ad agency. For example, the “You Find It, You Keep It” campaign currently running on TV appeals to the cost conscious, not the value conscious.
Star Trek:Next Generation Tablet (Already dated!)
Finally, all this allows me to make a prediction. Apple will introduce a product, some kind of iTablet or iPod Super touch, that fits (in size) between an iPhone and a MacBook. We know it will embody Apple’s unique vision. What we’ll have to remember is that it will be a product that appeals to Apple’s own customers, a different breed of customer.
It’s miniaturization, utility, technology, and quality will cost a lot more than we’d secretly hoped for. It will end up costing more than a basic MacBook which has, more or less, industry standard PC components. But guess what, we’ll drool, save and want one so badly, it’ll drive our families crazy. But, having no starship bridge to work on, we’ll figure out how to get one anyway.
