Quote:
Originally Posted by tomsem
But it seems to me they are having less and less market impact with their new products. I have yet to see an Apple Watch in the wild, for example, even though about half the people I see around have iPhones. Part of that is that there are many companies now that put out great electronic products and it is harder to stand out.
But HomeKit is going nowhere without some sort of device like this.
|
It's not just an Apple thing.
It's an ecosystem/brand loyalty kind of thing.
Once a company ecosystem grows big enough and brand loyalty strong enough, any halfway decent product will sell to the faithful, no matter how buggy or half-baked. So telling the successes from the thuds becomes much harder.
There's what? 200Million iPhones out there? 300Million?
And maybe 30 million of those bought iWatches?
12milion bought Apple TVs?
Are those successes or failures?
It is the same ecosystem but is the value proposition comparable?
Not clear.
Two very clear cases:
The original PS3 was a gold-plated over-priced disaster for Sony. It took years for them to strip out features to finally get its build costs in line with market pricing. Fans griped about losing features, about buggy games, about the higher price...
...and it still sold well enough that Sony survived (unlike Sega). Some of it was their home market which simply refuses to buy foreign products as long as a native alternative exists, but most of it was the loyalty of the people who grew up with Playstation 1 and Playstation 2 and couldn't conceive of switching to a different ecosystem. A similar dynamic is playing out right now with XBOX where a significant portion of the market shrugs off the graphics power differential between XB1 and PS4; they're not about to jump ship just because of slightly prettier pictures.
In contrast...
B&N's Nook zoomed from zero to 26% market share in early 2010 on the back of their brand loyalty. The reader was buggy, heavy, had a cumbersome interface, but the faithful bought it anyway and kept it alive while the fixes trickled out. Unfortunately for B&N they misread this loyalty and assumed product sales were drawing from the broader pool of mainstream buyers and not just their established customer base. Once that customer base bought all the ereaders it was going to buy and they had to reach the boader market, sales fell short of projections. A death spiral followed because the ecosystem wasn't strong enough to survive their missteps solely on brand loyalty.
There is a threshold beyond which brand loyalty trumps missteps, at least for a while. Apple has it. Google has it. Sony has it. Xbox has it. Nintendo had it but the missteps have been piling up...
Amazon looks like it's getting there. They didn't have it when the Fire Phone launched but their brand has gotten a lot stronger in the past two years.
The thing about brand loyalty, though, is that measuring success or failure by raw numbers isn't enough. You have to measure against the size of the brand's customer base.
Playstation loyalists continually pointed out that PS3 was selling at the same rate as most other consoles at that same point in their lifecycle so how could it be a failure? Except that it launched as a followup to the PS2, which had racked up a 90% market share so, regardless of the raw numbers, PS3 had failed to capitalize on that penetration and had driven a good portion of customers to the competition. For Sony's s bottom line that was a failure and the culprit was fired, japanese-style.
A product that might be a great success for one company might be deemed a failure at another. For perfectly valid reasons. As always, in these matters, context matters.
James Patterson selling a hundred thousand copies of a new book would be a dismal failure, whereas that same number would be a roaring success for 99% of writers.
You see it in movies and TV where shows get cancelled at CBS and ABC that would be tops at Fox or CW, to say nothing of the cable networks.
Raw number alone say nothing.
Homekit alone will get deployed to millions just off the Apple name.
Will a two years late me-too speaker help? Maybe. Maybe not.
But with Apple's installed base and brand loyalty it would have to be an eVilla level disaster not to sell.