Apple’s Branding Strategy

Case Study – Apple’s Branding Strategy

Apple Brand Personality | Customer Experience | Apple Brand Architecture | Apple Halo Effect | Siri | Siri v Alexa | Corporate Market | Apple Watch | Original Apple Mac Marketing Strategy

Apple Inc. uses the Apple brand to compete across several highly competitive markets.  Apple’s brand has evolved as it has expanded its range of products and services.  Originally starting in the late 1970s with desktop computers and then laptops in the 1990s, it took over 20 years before the company expanded into its first major new product area with the launch of the iPod in 2001, followed by iPhone in 2007, iPad in 2010, then Apple Pay and Apple Watch in 2014.

In the early decades, Apple’s brand was very much that of a challenger, bringing  easy to use computers to consumers and small businesses in a way that as focused on the needs, individuality, and style of ordinary people, rather than the conformity and technical mandates of big business.

Apple’s brand position has evolved, but today’s brand is still consistent with these early promises.

Apple’s core competence remains delivering exceptional customer experience through superb user interfaces. The company’s product strategy is based around this, with the iPhone (with it’s touch screen “gestures” that are re-used on the iPad), Mac, iCloud, iTunes, and the Apps Store all playing key roles.  THE distinctive feature of each of Apple Pay and Apple Watch remains the customer experience of an elegant user interface and simplicity of use.

Starting with a major re-vitalisation of the Apple brand when the iPod was launched in 2001, Apple worked hard to harmonize and migrate its brand and its product strategy closer together, to achieve today’s position.

Steve Jobs, Apple’s co-Founder, described Apple as a “mobile devices company” – the largest one in the world. The company renamed itself Apple Inc. rather than Apple Computer. At the time, this was a significant move, signifying Apple’s move beyond being more than a computer company.

The company is now defining itself more broadly than being just a devices company.  It has blended its digital content services (eg Apple Music, iTunes, iBooks and App Store) to be a key part of the value proposition to Apple device owners, and (with iCloud and Siri in the background) Apple is making many services and functionality which consumers use accessible on whatever (Apple) device they happen to be using at the time, be it on their desk, lap, fingertips or wrist.

The Apple Brand Personality

Apple has a branding strategy that focuses on the emotions. The starting point is how an Apple product experience makes you feel. The Apple brand personality is about lifestyle; imagination; liberty regained; innovation; passion; hopes, dreams and aspirations; and power-to-the-people through technology.

The Apple brand personality is also about simplicity and the removal of complexity from people’s lives; people-driven product design; and about being a really humanistic company with a heartfelt connection with its customers. Through these qualities, Apple is positioned as being extremely helpful to people (and businesses) as they strive to achieve their goals.

Apple Brand Equity and Apple’s Customer Franchise

The Apple brand is not just intimate with its customers, it’s loved, and there is a real sense of community among users of its main product lines.

The brand equity and customer franchise which Apple embodies is extremely strong. The preference for Apple products amongst the “Mac community”, for instance, not only kept the company alive for much of the 90’s (when from a rational economic perspective it looked like a dead duck) but it even enables the company to sustain pricing that is at a premium to its competitors.

It is arguable that without the price-premium which the Apple brand sustains in many product areas, the company would have exited the personal computer business decades ago. In recent years, this strength in brand preference has flowed directly to Apple’s profits – as the company dramatically improved  its manufacturing costs, while still maintaining very strong brand equity.

The Apple Customer Experience

The huge promise of the Apple brand, of course presents Apple with an enormous challenge to live up to. The innovative, beautifully-designed, highly ergonomic, and technology-leading products which Apple delivers are not only designed to match the brand promise, but are fundamental to keeping it.

Apple fully understands that all aspects of the customer experience are important and that all brand touch-points must reinforce the Apple brand.

Apple has expanded and improved its distribution capabilities by opening hundreds of its own retail stores in key cities around the world, usually in up-market, quality shopping venues.

As it developed the iPhone business, Apple hugely increased its retail reach through the retail outlets of the telco companies.  Apple has also increased the accessibility of iPads and iPods through various resellers that do not normally sell computers, and has increased the reach of its online stores.

The very successful Apple Retail stores give prospective customers direct experience of Apple’s brand values. Apple Retail visitors experience a stimulating, no-pressure environment where they can discover more about the Apple family, try out the company’s products, and get training and practical help on Apple products at the shops’ Guru Bars. Apple retail staff are helpful, informative, and let their enthusiasm show without being brash or pushy.

The overall feeling is one of inclusiveness by a community that really understands what good technology should look and feel like – and how it should fit into people’s lives.

Apple Brand Architecture

From a brand architecture viewpoint, the company maintains a “monolithic” or master brand identity – everything being associated with the Apple name (or the Apple logo), even when investing strongly in the Apple iPhone, iPad, iPod and Apple Music products.

Apple’s current line-up of product families includes not just these devices, but also iMac, iBook, iLife, iWork, iPhone, iPad, and iCloud. However, even though marketing investments around iPad are substantial, Apple has not established an “i” brand. While the “i” prefix is used only for consumer products, many of Apple’s consumer products (eg Mac mini, MacBook, Apple TV, Music, AirPort Extreme and Time Capsule, Safari, QuickTime, and Magic Mouse) do not use it.

The 2014 move to establish the Apple Pay and Apple Watch brands has in fact drawn its newest business areas to be even more closely associated with the Apple name. There is no iWatch brand, and the brand identity of Apple Music, Apple Pencil, Apple Pay and Apple Watch is simply the Apple logo combined with the word which describes their function.  Interestingly, the brand names of Apple Pay and Apple Watch are consistent with Apple TV –  one of Apple’s long-term projects that has the potential to transform user experiences in yet another aspect of people’s daily lives (an ambition reinforced by being featured in Apple’s September 2015 Special Event, and again at Apple’s World Wide Developer Conference – WWDC – in mid 2016).

The list of Apple’s Trademarks reflects something of a jumbled past. The predominant sub-brand since the introduction of the Apple Macintosh in January 1984 was always been the Apple Mac. Products whose market includes Microsoft computer users (for example QuickTime, Bonjour, and Safari) have been named so they are somewhat neutral, and therefore more acceptable to Windows users. Yet other product have been developed more for a professional market (eg Aperture, the Final Cut family, and Xserve).

Apple Brand Halo Effect

Though Apple’s iPhone and iTunes music business (now largely replaced by Apple Music subscription service) have been profitable in their own right, Apple’s venture into these product areas was originally based on a strategy of using the music business to help boost the appeal of Apple’s computing business.

Apple used iPad, iTunes, iPhone, and (very important at the time) iPod to reinforce and re-invigorate the Apple brand personality. At the same time, these product initiatives are growing a highly relevant, appealing brand image in the minds of consumer segments that Apple has not previously reached.

In a so-called iPod halo effect, Apple hoped that the popularity of iPod and iTunes among these new groups of customers would cause these segments to be interested in Apple’s computer products. This does seem to have happened. Since the take-off of the iPod there has been a dramatic rise in Apple’s computer sales and market share.

Some years ago, Apple’s aspirations for the iPod halo effect was highlighted most strongly when it used the slogan “from the creators of iPod” in its promotion of iMac G5 computers. In this instance, the Apple brand came full-circle – having been built into a branding system that originates in the personal computer market, then leveraged into the consumer electronics market, and then back into the consumer personal computer market.

This halo effect is extended with the hugely successful Apple iPad tablet computer. Great customer experience with iPhone (and familiarity with Apple’s touch screen gesture controls), combined with a great product in its own right, has made iPod a huge success that in turn is drawing even more people to Apple’s Mac computer products. In a move which brought matters full circle, the 2011 Lion version of Mac OSX gave the Mac the same touch screen gesture controls which iPad and iPod users have learned. In 2014 at the company’s World Wide Developer Conference, it further strengthened the link between the Mac and other product lines by making it easy to provide continuity of user experience for a customer using a mix of Apple devices during her daily life.  This was further emphasised in mid-2016 by changing the name of the Mac’s operating system from OS X to macOS (presumably partly to avoid a naming collision with the 2016 version of iOS: iOS 10).

Probably to remove any customer confusion and to better align each one to its related hardware product, Apple evolved “OS” into a sort of sub-brand: Apple shortened the product name of Mac OSX to “OS X” in 2012 and then changed it to “macOS” in 2016 to align with the branding of Apple’s other operating systems, iOS (iPad, iPhone, and iPod devices), watchOS (Apple Watch), and tvOS (Apple TV set-top box).

Apple is employing the halo effect in its Apple Mac product strategy.

From mid-2012 onwards, OS X (now macOS) incorporated many small changes to the Mac user interface that make the Mac’s style of use much more like the iPad and iOS. By introducing such changes (which have frustrated some long-term Mac users), Apple has clearly decided that greater volumes of Apple Mac can be sold through selling to iPad (or iPhone) users than can be generated by upgrade sales to long-term Mac users.

This extension of a common user experience across Apple products was further strengthened by the introduction of the Apps Store to Mac OS X in mid-2011. Mac users can now buy their macOS applications with the same convenience as iPad or iPhone users can buy iOS Apps.

Also in 2012, Apple dropped the Mac part of the name from the operating system, so that it is now called just “OS X”, rather than “Mac OS X”. This small but important branding change highlights that Apple, not Mac, is now the dominant part of the brand. It also opens the way for Apple to OS X on multiple devices, not just Mac, in a similar way to how iOS is used on iPad, iPhone and iPod Touch. A full merge of operating system code seems unlikely however, since CEO Tim Cook explicitly stated (in late 2015) that that iOS and OS X will be not merged into a single Operating System.

Expect the Halo to Speak – Siri and beyond

Speech is the next dimension in which Apple aims to gain synergy across its product lines. Siri’s natural language speech processing and interactivity capabilities were introduced in October 2011 on the iPhone 4S. Siri was then introduced on iPad in 2012, Apple Watch and Apple TV in 2015, and on macOS Sierra in 2016. With the addition of Siri to the Mac, Apple now has a common user interface across all of its core product lines.

Apple is giving substance to speech interactivity by giving it a character – a personal assistant called “Siri”. Siri can be somewhat customised by using different languages and idioms (for example, there are 9 versions of English speech available with country-specific accents and pronunciation for Australia, Canada, Denmark, India, New Zealand, Singapore, South Africa, UK, and USA, together with male and female voices for each). Presumably other customisation or personalization features will also be introduced (perhaps user choice of name and other “identity” characteristics).

Siri highlights the marketing genius of Apple: speech control and interactivity are not new features on computers or phones. For example, smartphones running Microsoft’s Windows Mobile operating system had very similar functionality to Siri for quite some time. When Apple created the Siri “personal assistant” which gives these otherwise rather hard to describe voice interaction features a character, consumers were given a hook around which they could finally understand what voice interactivity was all about.

Having taught customers to use touch gestures, Apple is now going to teach us how to speak to computers (almost unavoidably, in a specific Apple dialect of speech interaction). Beyond this, because Siri provides access to Apple’s increasingly powerful Artificial Intelligence technology, Apple now also has a means of enhancing the user experience – across its complete product range – in quite remarkable ways into the future.

Apple Siri versus Amazon Alexa

Challenging Apple’s progress in this area is Amazon’s “Alexa” voice assistant. Initially associated with Amazon’s own range of intelligent speakers, Amazon has successfully established Alexa as the best known voice assistant by promoting it heavily as the primary mode of interaction with the speakers.

The approaches of the two companies has been very different: Apple sees Siri as a cross-platform intelligent assistant and does not feature Siri heavily in its marketing. In contrast, Amazon has focused on establishing the Alexa brand over and above the brand name of its speakers. Amazon wants you to buy an Alexa, rather than an Amazon Echo or Show. In most markets Alexa is much more well-known than Siri.

Siri, then, is not really being used by Apple as a brand. It remains the name of a useful technology. No-one goes out to buy a “Siri”. There have been consequences of this for Apple: Apple chose to associate its own range of intelligent speakers with its home automation brand (Apple intelligent speakers go by the “HomePod” product name), arguably with predictable results – HomePods are far less common than Alexa-enabled speakers – despite being initially promoted as part of the Apple Music offering.

To Apple, this may be a conscious trade-off. Arguably Apple is playing a bigger game… aiming to make Siri a key point of differentiation across its product range, from everything to phones to payments (with Apple Cash in USA), to cars. Wherever voice interaction would be useful, Apple is enabling Siri across its product range. This being the case, Siri is a technology brand name, rather than a product brand. .

Apple Re-entering the Corporate Market via the iPhone and iPad Halo Effect

In recent years a large part of Apple’s strategy seems focused on the Corporate marketplace. The company is careful to maintain its brand values as it engages with corporations:  it positions itself as facilitating the use of the individual’s devices of choice (primarily iPads and iPhones) in the corporate world so that businesses can innovate and develop new ways of doing business and improving the world around them. Apple also announced a global partnership with IBM in mid-2014 which will see IBM furthering the penetration of iPads and iPhones into large corporates though its IBM MobileFirst initiative. (Similar partnerships with Cisco being announced in 2015, and with SAP in 2016).

The business market has been important to Apple before: A long time ago, Apple had a strong market share in large companies.

A long, long time ago (at the end of the 1970’s) the first spreadsheet program (VisiCalc) was launched on the Apple II. The first PC (the IBM PC) to run a Microsoft operating system (PC DOS) did not appear until 1981. When Microsoft launched its Excel spreadsheet in 1984 it appeared first on the just-released Apple Mac, such was Apple’s presence among accounting and finance departments.  The “creative professions” (most notably the now largely defunct Desktop Publishing industry) have always been an important business market for Apple and its main software partner in this area, Adobe.

Even though Apple effectively stopped competing for corporate business during the 1990s, the Apple Mac is still used in corporate environments. Microsoft still has a vigorous applications development team totally dedicated to writing business software for the Apple Mac. New versions of Microsoft Office for Apple Mac still come out approximately 2 years before similar functionality is placed in the next version of Microsoft Office for the Windows operating system.

Over the next few years it seems likely that Apple will re-focus on the Corporate marketplace: The company provides regular updates on the proportion of Fortune 500 companies which are either trialling or deploying iPhone (now well over 90%), and the iPad.

Apple has solved all the technical problems of integrating its iOS and OS X products into existing Corporate IT environments. For example, starting in 2009, when Apple announced “Snow Leopard” (the then-latest version of the Apple Mac operating system) it included features allowing Mac computers to fully support Microsoft Exchange. This enables corporate IT departments to support business users who wish to use Apple Macs for their main email clients. Apple’s Mac OS X Lion release (in Summer 2011) includes all the functionality needed to use a Mac as a business server.

Also, Microsoft continues to bring out advanced versions of Microsoft Office for Apple Mac, and – very significantly – in mid-2008 Apple announced a software upgrade for the iPhone which allows iPhones to be fully supported by Microsoft Exchange email servers. Corporate IT departments can now include iPhones as email clients.

One aspect of Apple’s strategy seems clear: to use the popularity of the iPhone and iPad to break back into large corporations, sell lots of those devices, and have Apple Mac back on the desks of large businesses (or more probably – in the laptop bags of middle and senior managers in most large businesses). Particularly with iPhone and iPad and the trend to bring-your-own-device into companies, there is a groundswell of expectation that Apple devices should be supported by IT departments, and employees often suggest many new business solutions and improvements which could be enabled by their use (particularly where better access to information when they are on the move would be particularly helpful).

The Macbook Air and iPad are clearly designed for business markets as well as for consumers, and Apple continues to display its mastery in smoothly morphing customer experience and brand preference from one product category to another.

In 2015 Apple CEO Tim Cook started to ramp-up statements about the company’s ambitions to sell to large companies, and Apple’s branding strategy is clearly expanding to include business and corporate markets once again.

After Halos – Clouds

An enabling next step in Apple’s marketing strategy is the Apple iCloud, which delivers a seamless experience for using and sharing content across all your Apple devices (iPhone, iPod, iPad, or Mac). iCloud enables a common “it just works” experience for using content across all of Apple’s mainstream products. iCloud positions the company for a future where customers experiences and their digital lives transcend the hardware devices which they use, and enables Apple to extend the brand experience well beyond individual products.

Apple has invested in a one million square foot Apple data centre in rural North Carolina. As well as being a hub for much of the intelligence behind Siri, this data centre is a core data repository for Apple’s iCloud services, which will enable Apple to leverage its customer franchise into an even broader market space. Apple iCloud is one of many ways in which Apple and Google are fast becoming arch rivals.

iKnow Siri?

It can be assumed that a user’s Siri personal assistant will be used to embody and create a feeling of continuous experience across different devices (including in cars), with Siri seemingly moving with us from device to device. For example, Apple CarPlay enables a car’s infotainment system to use a familiar iOS user interface when an iPhone is connected, allowing you to control many apps and your device either through the infotainment system or with your voice and Siri (so you don’t need to touch your iPhone while driving).

This continuity of experience across devices will be possible because Apple is using iCloud to offer customers device-independence and multi-device synchronisation – so that whichever Apple device you move, to the experience continues because the new one will “know” what you were doing on the last one and can pick up dialogues such as chat messages where you left off.

Apple Watch: The Masterbrand and Brand Promise

The use of the Apple Pay and Apple Watch brands reflect just how strong the Apple brand name has become over the last 10 years.  The Apple Pay and Apple Watch names are descriptive and they leverage the full strength of the Apple brand in each of the new categories which Apple is entering.

The brand promise which the names of Apple Pay and Apple Watch contain is now greater than the halo effect – in a way that would not have been possible 10 years ago.  Because the Apple brand personality is now so strong, our expectations are already set, with the products themselves having to live up to the brand promise. Their role is to sustain the brand promise, rather establishing it, as many of the i-products needed to.

Apple’s Original Apple Macintosh Marketing Strategy

Stanford University has published contemporary records and original documents of the marketing strategy for the Apple Macintosh launch in 1984, including the original Apple marketing strategy and the Apple Macintosh product introduction plan written by Regis McKenna in 1983.

It is now nearly four decades since the launch of the Apple Macintosh (on January 24, 1984). Having proven itself and already gained considerable popularity with the Apple II, Apple chose to announce the Apple Mac in one of the most famous-ever commercials, aired during the third quarter of Super Bowl XVIII on 22 January 1984.

1984 Apple’s First Macintosh Commercial

If you would like to see the complete event at which Apple’s Steve Jobs formally introduced the Apple Macintosh, watch Steve Jobs and the Mac team do the first public reveal at the Boston Computer Society General Meeting, January 30, 1984: