Imitating Apple is a Losing Strategy

Note: I wrote the initial draft of this column prior to the announcement of Steve Jobs’ resignation. The point of this article seems even more pertinent now. In particular, I believe Apple’s success is likely to continue even without Jobs at the helm.

The story of the iPhone’s success is now almost a cliché. Sure Android phones have outpaced the iPhone for market share. But the iPhone 4 is still the single most popular smartphone (even though it’s over 14 months old) and it’s surely the most profitable. Equally compelling, the iPhone has forever changed smartphone design. Almost every smartphone available today bears a striking resemblance to the iPhone — beginning with a stylus-free touchscreen. Prior to 2007, there were no such touchscreen smartphones of any design.

The story of the iPad’s success follows a similar path — except it goes even further. None of the iPad’s competitors have gotten any significant traction as yet. Not even Android-based ones. RIM’s Playbook tablet is going nowhere fast. HP’s TouchPad went down in flames within weeks of its release. The iPad continues to dominate the market with around a 90% share. As the current joke goes, “There is no tablet market. There’s just an iPad one.” The iPad is not only a success in comparison to other tablets, its reach extends to the market for desktop/laptop PCs. iPad sales continue to soar as PC numbers (except for Apple’s) flatline. If HP exits the PC market, Dell will be the lone surviving U.S. manufacturer of PCs (other than Apple).

None of this is a surprise at this point. If you follow technology news, you’ve heard variations of these statistics for months. What is a bit surprising (at least to me) is that there is a third act to this play: The MacBook Air. It too has become a huge competition-stomping success. As pointed out by Jason Cross in a recent PCWorld article: “This year’s fourth-gen [MacBook Air] is proving to be the must-have laptop of the year. For every laptop manufacturer not named ‘Apple,’ the race is on to make new super-thin and super-light laptops.”

This idea that “the race is on” highlights a critical point that helps explain why Apple is succeeding where other companies flounder: Every one else is racing to catch up with Apple (with the possible exception of Android smartphones). For Apple’s competitors, this is a doomed strategy from the start. True, Microsoft managed to pull this off with Windows back in the 1990s, but the market is far different today. Even Microsoft has been unable unseat Apple’s iPod as the dominant MP3 player (and let’s just skip over their Kin smartphone humiliation). On top of all of Apple’s hardware success, the iTunes Store remains the number one source for purchasing music.

Apple competitors will never win if their essential strategy is to wait for Apple to come out with the next ground-breaking game-changing product — and then take a year or more to scramble to imitate it, eventually releasing a product that is inferior to what Apple is selling.

What the companies ought to be doing is developing their own new products, hopefully coming out with something so different and innovative that Apple has to play catch-up with them. The problem is that Apple’s competitors don’t seem to operate in a way that allows for this possibility. As Jason Cross wrote: “If you want to make the product that everyone else compares their product to, you have to go outside the envelope. You have to take a risk to build something nobody has told you they want, because they don’t know they want it yet, and then you have to invest in it and stick with it until you get it right.” This idea is really a variation of a famous Steve Jobs dictum: “It’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them.” That’s what Apple does: Takes the risk and builds the products it believe customers will want, even if the customers don’t know it yet.

Too many companies are afraid to take these big risks. They seek products that offer incremental improvements at best, rather than looking to shake up the market. Instead of asking “How can we deliver a product that blows the competition out of the water?” they ask “How can we market a product that will give us an edge, however slight, over our nearest competition?” This is a recipe for remaining in Apple’s shadow. Rather than leading in bold new directions, they play follow the leader.

If companies truly want to compete with Apple they should strive to imitate the corporate culture that allows Apple to make great products, not the products Apple makes.

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One Response to Imitating Apple is a Losing Strategy

  1. Pingback: Ted Landau’s User Friendly View: Steve Jobs & Apple: Past, Present, Future | Android iPhone iPad Gadget Smartphones 963

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