Pixel Envy

Written by Nick Heer.

The Monopolist

Three posts on a common theme, but otherwise unrelated. First, Horace Dediu:

Great companies are “monopolists of customer trust” and are unaffected by alternatives. They are positioned on and nailing the job their products and services are hired for. The alternatives must not only duplicate the exact job (which they almost never do), but they must also overcome the switching costs.

Remember this when analyzing the impact of yet another competitor and considering the “Apple must fix/do X or else” assertions.

Ken Segall:

[Steve Jobs] believed that a company’s brand works like a bank account. When the company does good things, such as launch a hit product or a great campaign, it makes deposits in the brand bank. When a company experiences setbacks, like an embarrassing mouse or an overpriced computer, it’s making a withdrawal. When there’s a healthy balance in the brand bank, customers are more willing to ride out the tough times. With a low balance, they might be more tempted to cut and run.

Steve went on record many times about the importance of building a strong Apple brand. And he benefited from having a high balance in the brand bank many times. One of the most negative stories in recent years was the now-famous “Antennagate” controversy. When iPhone 4 was launched, Apple was battered by journalists and influential bloggers over what was perceived to be a flawed antenna design. Despite the heavily negative press and ridiculing by late-night TV hosts, Apple’s customers remained true. Now that episode is remembered only as an example of overreaction, with virtually no long-term impact.

Craig Hockenberry:

Apple is a manufacturing powerhouse: the scale of your company’s production line is an amazing accomplishment. Unfortunately, software development is still a craft: one that takes time and effort to achieve the fit and finish your customers expect.

Apple would never ship a device that was missing a few screws. But that’s exactly what’s happening right now with your software products.