The extent to which Apple CEO Tim Cook is guiding the company’s transition to a post-consumer mass-market product business should be a guide for others considering a similar evolution.
The world of change
Think about it and the reasoning is clear. China’s talks last week focused on reducing energy availability as the country struggles to meet climate targets. World leaders will meet soon to outline what hopefully (but probably not) will be an effective global strategy to tackle climate change. Part of this will require changes in the way things are made, what they are made of and how they are sold.
Apple knows it.
And while the iPhone remains the company’s most important product, and its fortunes continue to be tied to computer hardware sales, Cook’s business has been racking up service revenue while working to mitigate at least some of the worst excesses of consumerism.
Three facets of the current iPhone 13 lineup illustrate Apple’s commitment to this transition. As one of the largest manufacturers of consumer electronics in the world, Apple knows it has to make those commitments before it is forced to.
Here are some of the changes he’s already making to prepare for post-consumerism.
Apple has always designed the whole experience, including that feeling you get when you open the box. As it seeks to build a business in a more complex world, Apple has devised a new way to package products without the use of plastic wrap. With iPhone 13, two tear-off paper tabs seal the box, and the wood used in the packaging comes from responsibly managed forests. The company also uses 100% recycled tin, tungsten and rare earths in the material.
While I think most people turn off when Apple tells us about its environmental work, it represents a big change in the way the company thinks.
These attempts to mitigate the impact of manufacturing tens of millions of these devices are not only important in an environmentally friendly sense; they should also guide any business seeking to carve out a sustainable post-consumerist future on a planet battered by climate change. If you want your customers to come back to you, you’ll need to work with them to make sure they always can.
There is a huge disconnect between many people in the tech press and the people who read what they have to say. When it comes to iPhones, writers tend to get jaded. We see the new device up close each year, which creates a perceptual bias through which we think our readers also see it that way.
It’s not: Apple’s target market with new devices isn’t the person who bought last year’s model, but those with a device that is three to five years old.
This means that when considering an iPhone 13, the comparison should be made with the models in the iPhone XS, XR, X, 8 and 7 series, rather than with the iPhone 12. Apple’s current crop has many improvements over these.
Any business striving for success in the post-consumer era will need to make a transition like this, building consumer loyalty through high-quality experiences that generate repeat sales, but over a much longer period of time. Yearly upgrades don’t make sense in a post-consumer society. Innovation for fun is surely less relevant, as people seek meaning and great improvement over a longer useful life.
(Critics will rightly point out that Apple’s lack of support for the right to repair and its insistence on using Lightning in its power adapters are flaws in its approach; supporters will point out the long lifespan of its products. and free software upgrades to counter this.)
Services and accessories
The proliferation of services and accessories (especially AirPods) in the Apple ecosystem is one of the biggest changes we’ve seen in the business under Cook (and Eddy Cue, senior vice president of services at Apple). Apple Music or Apple One, AirPods or Beats – these give the company a revenue shield. After all, at one point its fate was pretty much predestined by consumer reaction to one or two big product releases each year. Now this is not the case.
Today, Apple offers several products through a plethora of touchpoints and prices covering hardware, software, and services. Yes, he still does Next Big Thing product releases, but is maximizing his business from them by building a larger ecosystem. The services have the added benefit of locking buyers into platforms. (I think the biggest opportunity is to allow for an even closer connection between the brand and the consumer.)
The success of post-consumer businesses will be built around creating strong bonds between “tribes”. Apple understood this realization early on – as early as 2011, neuroscientists recognized that its products created similar reactions in some people’s brains to religious experiences. This type of connection with our target market is essential for post-consumer success, with Millennials / Gen Z audiences seeking meaning and purpose throughout their lives.
Apple’s work to pivot its brand to respond to these new, complex and interwoven realities will ultimately be seen as one of the many deep leadership games executed by Cook and his team.
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