What Your Business Can Learn from Cell Phones
There are only two months left in 2012. Hard to believe the year went by so fast. We’ve seen a lot happen in the ten months of 2012 that have gone by already. 2012 was another year that proved that technology marches on and progress can’t be held back. We landed a car-sized robot on Mars for Pete’s sake!
Not only did technology and progress continue to move forward, but our commercial and personal lives became ever more entwined in this movement. We’ve seen an explosion in smartphone usage, as well as in their cousin the tablet. This expansion in use and ownership is actively changing how people communicate with each other and how consumers and businesses relate with one another. This smartphone adoption trend is going to continue, especially with the holiday season fast approaching. It is increasingly becoming apparent that we simply can’t live without our smartphones.
So what? You’re just saying more and more people will just have fancier phones.
Yes, more and more people will have fancier phones. Bear with me though. There are a lot of lessons your business can learn from the increasingly competitive smartphone market. The companies at play have all taken different strategies in their attempts to dominate the competitive market. Isn’t that what every business wants, no matter what industry it operates in? By taking a look at the businesses involved in creating our beloved cell phones we can see what works and doesn’t work and in the process gain some important insights about running a business in the digital age.
Ok, I’m intrigued now, let’s take a look at this.
For the most part, the primary actors in the world of cell phones are RIM, Apple, Google, and Samsung. These companies are the minds and muscles behind what is likely to be the “fastest spreading technology in human history.” All five of these companies have taken different approaches to creating, marketing, and selling their phones. These approaches have worked brilliantly, failed beautifully, struggled along, and everything in between. Let’s see what we can learn from them.
RIM: A Quick Rise and a Quick Fall
RIM or Research In Motion, is a Canadian company that took the smartphone world by storm in the mid-2000s. Michal Lev-Ram writes for CNN that “just three years ago, Fortune named RIM the world’s fastest growing company, as it expanded profits at a monster rate of 84%.” Read that again: monster rate of 84% profits! RIM, with its flagship smartphone Blackberry, managed to integrate fast and reliable e-mail service with easy usability.
What allowed RIM to rise so fast? Mostly it was the good fortune of being first on the scene with a device that does what people needed out of early smart phones: e-mail and business on the go in a reliable and fast way. Blackberry became the “smartphone of choice for … mobile professionals.” This market drove Blackberry to rapid success. But then the iPhone arrived in 2007 and today RIM’s stock has dropped 90% and they have a paltry share of the market. RIM’s response was to keep selling improvements of what used to be successful. But it was too late. User-friendly smartphones for the mass public were now the norm.
What can we learn from RIM?
We can learn a few things from RIM: Be skeptical of your success; do not become complacent and focus on your strengths. RIM found a market that propelled them to success, but it was also their downfall. Apple and then Google came along with smartphones that people – not just professionals –wanted. The rules of the game had changed and RIM never tried to adjust. As Jason Fell writes for Entrepreneur, “the company effectively shrugged off the threat that Apple was creating a “Blackberry killer.””
A Silver Lining and More Lessons?
Scott Anthony at the Harvard Business Review sees a chance for success for RIM. You see, RIM’s subscriber base unexpectedly grew in September by 2 million users. RIM’s system worked great for professionals in the US and elsewhere. But they kept trying to compete in a market that had changed in the West. In today’s increasingly connected and rapidly developing world, there are millions of people out there who have a need for what RIM provided to professionals in the developed world in the early 2000s.
Scott provides three lessons from RIM’s history and its future: quality is a relative term, spend time on the periphery to escape the availability heuristic, and closed systems have their advantages. Simply because it seems as if a business has failed in its market, does not mean that this is the case in every market. Businesses should be willing to take the risk to explore how the rest of the world can benefit from their products. Be sure to read Scott’s article for more in-depth information.
Apple: A Modern Smartphone Propelled by its Brand
As mentioned above, Apple landed on the scene in 2007 with its first iPhone. Five years later it frequently flirts with the title of the most valuable company in history. Apple’s story is hardly worth telling; it’s obvious to everyone who pays the slightest attention to the company.
Apple proved a business can take what it’s good at doing and turn that into a new market. Before iPhones, Apple made computers and music/video players. People loved their devices and Apple consistently and relentlessly built a brand image based on their products. This helped to propel the iPhone to success. Building your brand in a focused and careful manner is vital for any business.
Lessons from the iPhone
First and foremost, as Adam Lashinsky for CNN Fortune writes, “make products, not money.” The iPhone is a product that Apple knew people would want. They did not approach its design with the goal of making money; they approached it with the goal of making something people wanted to own and use.
The profits will come if the product or service is good.
Second, in your business, avoid inconsistency at all costs. Why does the iPhone (all five versions of it) continually appeal to consumers? Because they know what experience they will get. The iPhone is consistent, it moves forward while remaining familiar. People like change, but not too much at once. Each iteration is simply an improvement of that experience. Building your brand around the experience you provide can propel your business far and put you in the right mindset for success.
Google: Being Different Can Work
Google was a little late into the smartphone competition, but not by much and they caught up fast. Their Android operating system has been increasingly dominating the market share of smartphones. Google currently commands a 52.5% share of smartphone subscribers yet they still face fierce competition from Apple.
What’s interesting about Google’s play in the smartphone market is the way they went about competing. The first lesson from Google comes from the Android operating system:
Offer consumers something different.
Google looked at its main competitor in the smartphone market, Apple, and learned from them. The closed ecosystem surrounding the iPhone is at the same time a boon and a bonus for the phone, and for Apple as a business.
Google simply created an open ecosystem with Android in order to offer consumers a different choice, an “open” choice. Android runs on phones created by multiple manufacturers, but ultimately Google controls it. They’ve recently entered the phone market themselves with their Nexus series and are continuing to improve it.
Essentially, as a business, don’t be afraid to offer up something different to consumers. Your competition gives you the strategy you need to focus on. Offer what they are missing and push that to consumers as you continue building your brand.
Samsung: “Copying” Works, too
Samsung is a prime example of an age-old lesson in business: take the best from your competitors, copy it, improve upon it, and sell it. Some would argue they’ve taken this lesson to a questionable level, which Apple is definitely against. The on-going court cases in multiple countries between the two companies have been in the news for months mostly starting with a intense case in the US.
Samsung is unique in that it takes a little bit from all of its competitors. It uses Android but tries to create the same high-quality brand experience that Apple does. Their flagship model, the Galaxy SIII imitates the iPhone but improves upon certain aspects; the Galaxy offers a larger screen, different technology, and an open ecosystem for apps and the operating system. Designing the product this way puts the Galaxy in the same tier as the iPhone. In fact, its commercials try to make their product looks superior, openly mocking their competition like the below example:
Taking this approach is definitely an option in a wide variety of businesses. Take a look at your competition to see if it’s feasible.
Samsung’s approach with their phones also teaches us an important lesson about social media for business. To promote their phones, Samsung has wholeheartedly embraced social media and consumer interaction to differentiate itself from its competitors.
Social media for business and content marketing works and Samsung proves it.
One prime example is a great little story about a kangaroo and a dragon which went viral this summer a few weeks before Apple released the iPhone 5. The social marketing and interaction combined with Samsung’s branding has enabled the Galaxy SIII to perform well, despite Apple’s success.
Watch these companies closely in the future.
Smartphones aren’t going away. As the competition between these companies continues to increase, it’s going to be interesting to see how the strategies each has adopted develops and changes. If you look closely enough, you’ll be able to apply the lessons these companies teach us, whether it’s in the realm of social marketing for business or in your business’ overall strategy. You’ll be hard pressed to find numerous important companies competing in an industry wrapped up in so many aspects of the future of business. Let’s all continue to learn from them.
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