Iphone, Ipod, Imuse
Like everyone else i was also caught up in the hype surrounding iphone announcement. As i started reading more and more about this phone, a question kept arising in my mind again and again. The question is this.
Why do people fall head over heals to talk about this phone. After all this is just another product from a company and why does all the media and people talk about it and market the product (the so called media hype) even before seeing the product? In short why are people and media marketing this product instead of apple or cingular?
As someone who is trying to drop his Electrical Engineering skin and start seeing things from a business perspective, i tried to look at this question from different perspectives and what i obtained were more fundamental questions and few answers. I will post these questions and some of my inferences and want to know your perspective on these. I don't want superficial answers to these questions guys. Think over it and post in your comments. You are also welcome to give me a call. We can discuss this. Srini, Sunil and Sapan, i am looking forward to your comments as i know you guys have interest in this area.
Here are my musings. What is so special about this iphone except that its coming from a company whose last product was a big hit (ipod). And if you really think very objectively there is nothing special about ipod. Its only "revolutionary" idea was the circular scrolling type access. The sound quality from its headphones is not so great. I have heard better sound from a cheaper Creative made product. People have already analyzed and come up with their own reasons why it was a hit. But my question differs a little. I have a few related questions which if we can answer, we might get a better insight into marketing.
We all know that if you ask anyone if they like to buy things that are unique, something which kinda reflects their identity or otherwise, they would atleast in theory almost always say they want something unique. But why do people go in for a product like ipod as if that is the only thing available. There are other music players that are as good if not better than ipod.
1) Why do people buy Ipod just to make a fashion statement? Is it because Ipod was released as a higher end product in which case many of the current Ipod users couldn't afford and slowly when the the price was reduced (its still expensive) people wanted to just satisfy their earlier desire to own something that they once couldn't afford. Now they are part of the "elite" crowd.
Or is my presumption wrong that people would want something thats unique (the idea that i have of Mankind is that every individual wants to be included in every group, but whatever group he is in already should be exclusive, meaning not everyone should be allowed in that) or something that's different from others is wrong?
2) This question came from the previous one. If you are to start a new business, which is a better way to brand yourself? Is catering to the masses like what WalMart does is better or branding yourself slightly upmarket so that you can keep coming up with new products for the upmarket and give out your older products to the masses (something like what apple is doing) better. I don't think walmart is such a good example since it is the biggest company in the world
Another observation here is that once you position yourself as a low cost product, it is very difficult to break into the higher end market. Even walmart couldn't move into upmarket products in fashion (if you have been following business news closely you will know that when it introduced the Metro 7 line of apparels it was a big flop). I think a better example here would be DELL. Can anyone think of a highend laptop like APPLE MACBOOK PRO from DELL. Will anyone even think of spending around 3000 bucks on a system from DELL. I don't think so, since DELL positioned itself as a low cost seller of computers. But the margins it is getting out of PCs are getting lower and lower. I read a report in NYTIMES (sorry i don't save the link, it was a couple of months back) telling that DELL is trying to move into the higher end because its current business is not getting it enough profit (quite logical, since there is only so much you save by cutting costs through efficient supply chains). The point is in the longer run which one is a better strategy.
3) The other observation here is with ipod, nothing was revolutionary except probably the way it was marketed and the way it looked. There were and there are better music players. It didn't have any of those revolutionary, earth-shattering technology involved to make it a big success. It was just a music player packaged in a neat looking way and tied with iTunes where people can download music. Simple stuff put together to make a very successful product. Something to think about......
Anyways please post in your comments. I have written it in a hurry, since this blog has been without any activity. I will from now on post atleast once a week. Part of my experiment at re-organizing my life towards a better lifestyle.
5 comments:
I was looking at a survey about Ipod's and realised that people buy ipod's for different reasons- The looks, the cool factor, the I-tunes download facility, the click wheel and believe it or not for the package box! The cool packaging and smart marketing has made it a household name. Walmart: cheap:: Ipod: cool
I believe pricing the product is more dependent on what you are selling. Electronics was never dominated by cheap suppliers like Coby. It was always the biggies like Sony and Philips who were dominating the world. Even Dell for that matter is not the cheapest laptop available. There are others like Avaratec, Gateway who are not doing that well. But if you look at grocery stores or household items, it's cheap that sells.
There are really some good players in the market but may not be up to the mark of ipod.
some of the things i have observed so far abt its marketing strategy is so good.i havent seen marketing of the other goods so far.microsoft tried its best to compete with it but terribly failed.the design is rubbish.though it had one or two gud features it was not able to cache people to buy it.
ipod: it looks cool, smaller in size & the capacity factor.
main advantage to its popularity is dueto its its itune package.cost of buying songs is very cheap.people can just the songs they wanted instead of buying the whole album.
they have made there songs sold on itunes playable in ipod.that has choked other company's players sales.
normally people like to own something an another person owns.its part of human actions.cool looks has dragged people to buy it.
The idea is not to just look at the reasons for seeing why Ipod was a success. As i had pointed out in the post, a lot has been written about it. I want to understand the psychological reasons behind branding and success of a product. To understand how important this is check out the videos in the following link.
http://video.google.com/videosearch?q=the+century+of+the+self
Its like 4 hrs (1 hr each) but its worth your time if you have an interest in business and psychology. You will be amazed to see how corporate america started using psychology to improve their sales and change the way people thought about spending.
In the case of Ipod, i just cannot believe that people buy Ipod because it is cool, ease of use etc., but there is something much more subtle that affects the way people make their decisions. As many have pointed out, people want to have stuff that others own, but they kinda reject stuff that are available to the masses immediately. A company's longevity is very deeply affected by the way you keep the consumers yearn for the products they make, but it should not be available for everyone when it is released.
It worries me to think that if i take my decisions based on some feeling (a desire i had long back) on such a simple product, how would i choose my spouse. Would i get carried away if i come across someone who kinda have something similar to someone i had a crush on sometime in my early teens or would i be mature enough and take a much more pragmatic decision? This thought worries me more...Anyways i think i will start reading sigmund freud pretty soon :)
hey dont compare choosing a gal & business.they r both different.
coming to u'r questions it can be true for fancy,at the same time the brand.people these days travel a lot & they need players with big capacity to listen to that is compact & simple in design for relaxing.
during that time we didnt have players with big capacity,light,well organised & simple design.it not only served the purpose of listening music but also helped in storing information.no battery & can be charged using computer.people r looking for products that can serve more than one single purpose.
i guess dell has lost its top spot to HP computers.dell laptops r costly & heavy compared to HP.
i agree totally what u said in u'r comments abt customers made to long for the products.
the same principle is followed in our M&S store.amount of stock done is less during launch.they create a impluse by broadcasting ads before the product comes in.it also helps them reduce the amount of loss.
for starting a business first thing is the quality of the product & secondly the price.
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