Where Should Apple Go Next?
In an aggressively evolving, copycat tech market, global brands are taking bites out of Apple. But brand Apple remains, at its core, the same as it’s ever been – relentlessly focused on customer experience.
Right now, brands in the smartphone market – are challenged. IDC reports that in Q1 2019 phone sales declined for the sixth straight quarter. Apple were hit particularly hard – a 30% decline in Q1 2019 compared to Q1 2018. And their year might get worse with the competition already shipping 5G enabled phones. *
But, while product sales have dipped year-over-year, revenue from the Apple services business climbed from $9.9 billion to $11.5 billion from Q1 2018 to Q1 2019. **
So, with the launch yesterday, we thought we might see a rapid move away from phones, iPads and Macs as the primary way people experience Apple. The brand is putting far more of an emphasis on services. Technical leaps from one product to the next are becoming inevitably less dramatic. So, we could see a focus on App Store, iCloud, Apple Pay as well as TV streaming service, Apple TV, and the subscription service, Apple News+.
A shift to service is not just a good bet, it’s already in play. And, speaking of play, there’s always Apple Music and Apple Arcade, unveiled in March this year, their games offering.***
An Apple launch isn’t what it used to be. An unveiling of a shiny new product. Now, it’s all about the service experience.
In part as a reaction to brands like Netflix and Amazon Prime blowing everyone out the water, or Huawei set to obliterate all competition with 5G, tech brands nowadays are leaning towards subscription services and experiences that go beyond the product.
But Apple products still manage to capture the imagination.
Despite a move to services over products, we still might see Apple focus on wearable tech and IoT, for example – EarPods, Apple Watch & Siri – products that offer ambient access to an increasingly connected world. Plus, its long been mooted the Apple electric vehicle (‘Project Titan’) has been under development and potentially due for pilot in 2029 – will they try to wrong foot analysts and create ‘shock and awe’ with a left-field announcement?
In all this, we know thing for certain. Apple will always look for new ways to serve customer needs. Because that's really what Apple has always been about: using technology as an interface to connect us seamlessly to the world, so we can leave our own indelible mark.
This ability – to go beyond product, to a brand purpose that lies with the customer – is what most brands aspire to.
Having relevance in a market where your core product is no longer in vogue, is a concept automotive brands are busy grappling with today. What is Ford in a world where the motor car no longer exists (a future that might not be too far away)?
For Apple, the question is analogous. In a world of no phones, watches and even no laptops, how does Apple stay relevant? It’s a big question that won’t be resolved overnight. But one way Apple can manage the transition, is by returning to their core strength.
In a rapidly changing world, brands that don’t adapt risk annihilation. Look no further than Nokia, Kodak and even Jamie’s Kitchen. The road to success is paved with brands that have fallen by the way-side. But brands that weather storms – brands like Nike, Coca-Cola and Apple – understand a simple truth. They might change WHAT they offer the world – the products and services – but they never change WHY they exist in the world – their purpose.
Nike don’t sell sports apparel. They sell an idea – that everyone can be an athlete, that you can find your own greatness. In a world that makes you feel you can’t, Nike says you can.
Apple also know who they are. They know why they exist in the world. To release the creative soul that lives in us all. This is a powerful brand purpose, because it has no expiry date. And it should carry them through any market fluctuations, if they can do what they have done so well before – harness new tech and bring it to us in bright new ways.
Everything Apple does – every product and every service – starts and ends with the customer.
This customer-first ideology should drive every agency Customer Experience group. That’s why at Ogilvy we always begin by defining the customer and what they want. Because, unless brands are able to understand and define the key problem customers have, and resolve it by offering solutions no one else can, they make no lasting impact or fade away.
Where brand success is measured by continual engagement, a ruthless focus on the customer – and customer experience – is not only effective, it can be transformational. Apple didn’t invent the mp3 player, but boy did iPod make it relevant, exciting and fresh with an intuitive, beautifully tactile and breath-takingly simple interface.
Apple excels when they can make ordinary everyday customer experiences feel extra-ordinary.
It almost doesn't matter what the new product – or service – is, that Apple are set to launch. What matters is how they can continue to find ways to help us connect and express ourselves. They don't have to invent new technology – all they have to do is package existing tech in new ways, making ordinary customer experiences feel extra-ordinary.
And that will always make the competition toothless. So, where should Apple go next?
Simple. Back to the customer.
David Hofmeyr (Planning Partner, Ford CX) and Dickon Laws (Head of Experience Design) and are both senior practitioners in Ogilvy’s Customer Experience Group.