If you build a better mousetrap, the saying goes, people will beat a path to your door. If you believe that, you’ll probably end up with a rodent-free factory and a full warehouse. Apple has always been strong on product. Sure, they ignored customer demand for CD-RW and designed the cube to please themselves while ignoring the cost, but Apple’s current woes are about salesmanship. Steve Jobs apparently went off on a tirade in a room full of resellers at MacWorld Expo. This, along with the rumors about Apple retail stores and the admission of a terrible misstep with the education channel, probably signals a shift in focus. Energy will now be expended on selling products and improving the retail experience. If done well, Apple stores will serve as showcases to increase overall product recognition and actually help the independent resellers.
When Steve Jobs made his triumphant return to Apple, the most important thing he did was to start advertising again. Under Gil Amelio there was virtually no advertising outside of Mac publications. People beyond the Macintosh community only saw the news stories about Apple’s imminent demise. This was disastrous. Jobs main focus since then has been on product. Hardware first, followed by software. The iMac was a good start at expanding the installed base, nicely followed by the iBook. Now they have to move beyond their niche with the professional products. The time is right to pitch professional Macs to a wider audience. It’ll be a tough sell, but education and consumer sales are not enough.
The Apple online store provides its customers with a pretty good sales experience. Out in the strip malls, it’s another story. I’ve participated in a few demo days and the mass retailers are a disaster when it comes to selling Macs. It really is worse than the car buying experience. Bait and switch, spiffs for the sales force, extended warranties. All that’s missing is a rustproofing package. There are wonderful specialty Mac shops out there with a depth of Mac expertise, but they are too few in number and don’t have the resources needed to significantly expand sales.
OSX, iMovie, iDVD and iTunes represent Apple’s latest software efforts and apparently there’s more to come, but attracting independent software titles for the Mac will continue to be difficult without growing market share. There is little or no software at most of the mass retailers selling Apple products. What message does this send to potential customers? There are many hardware products that could easily run on the Mac but lack drivers. And look at AOL with its terrible lag in the introduction of Mac versions of its software. Microsoft has thankfully reversed its practice of just porting Windows programs to the Mac as an afterthought.
Products like the Pentium processor, Windows, AOL and Quicken dominate their respective markets and its not that they are even good products. Aggressive marketing and in some cases illegal and anti-competitive practices have factored heavily. Bill Gates is right to be paranoid, because if you concentrate on strategy and ignore product long enough you will hit a wall. Just look at how the poor performance of the new Pentium IV has left Intel open to serious damage from AMD. Apple on the other hand needs to focus on selling product, not just designing it.
The bad news is that the need to replace hardware is just not there for many folks. I paid a huge sum of money about ten years ago for a MacIIfx. I’m an Architect, and Computer Aided Design required serious horsepower. Personal computers were barely up to the task, so I bought the newest most powerful machines every two years. Not so any more. I am content to use an upgraded 8600/400MHz G3 and live comfortably on the trailing edge of technology. Replacing this machine would be hard to justify for any practical reason. My wife replaced a Performa 6290 about a year ago with a 333MHz iMac, which should meet her needs for years to come. Thankfully, she’s retiring a three year old WinBook for a new Titanium G4! My laptop is a 2400/240MHz G3 which suits my needs just fine. I’m writing this on a Twentieth Anniversary Mac/300MHz G3 with no plans yet for a replacement. Who says Macs aren’t upgradeable?
Falling prices combined with steady gains in performance have helped the market to reach a saturation point. The performance gains continue, but these are becoming irrelevant to more and more people. Prices have been leveling off and that has contributed to a turndown in sales. The free PC didn’t pan out and the $800 iMac may represent the entry level machine for some time.[Bob Snow]
