The Cool Effect
For years Apple has been selling expensive products. One reason they have been able to do this is the “cool factor”. When Apple first came into its own, they did so by focusing on a niche market where the tech was highly developed, but seemed clunky and geared toward more tech-savvy users. Apple was able to dominate this market by offering products that seamed simpler to use and were sleek, stylish, and cool. Owning an Apple product may have been pricey, but for many that was the acceptable cost of style.
The Time Effect
The problem with a business model based on popularity and “coolness” is that the definition of trendy changes from generation to generation. This is precisely what is happening with many of Apple’s products today. Where once they offered a new, modern take on technology, they are now failing to resonate with many younger generations. Apple products are now the thing that boring parents or older generations have – they’re no longer seen as worth the price just for the bragging rights.
Another complication is that Apple is having trouble offering services that bring something new to the table. Their music streaming is more complicated and expensive than things like Spotify and Pandora which are already popular, well-established services. The same is true for Apple’s voice-command system (Siri), HomePod (their answer to Alexa), and T.V. streaming services. The systems are more expensive, have more complicated interfaces, and don’t offer anything significant to draw consumers away from already-established services which cost less and are more synonymous with trendy youth culture.
The Effect on T.V.
When it comes to T.V.s, Apple is trying to break into the market from a significant disadvantage. Their Apple T.V. costs six to eight times more than a basic Roku does, which performs a similar function with an easier-to-use system. Also, the assumption is that Apple’s streaming services for T.V. and original content will depend heavily on their established music streaming service. Or, as one article in Forbes puts it: “their shows will be distributed on the least popular streaming music service which will only be available on the least popular streaming TV device, which will likely be controlled by the least popular voice-activated speaker.” This is especially problematic since Apple is planning to target younger users who are no longer predisposed to buy Apple products for the sake of style or trendiness.
What this Means
The good news for Apple is that their iPhone is still immensely popular, which helps bolster the company when it’s branching out into riskier business areas. If they can market their T.V.s to appeal to younger audiences, or can draw customers in with free services such as included free T.V. content, they may be able to make this work. One thing is for sure though: Apple now needs to prove themselves with the viability of their products and can no longer coast on their “cool factor”.