Apple vs. the World Case Study: iPad Sparks an Apple iFrenzy

Week 4 Case Study
Apple versus the World- IPAD sparks an Apple ifrenzy

At the end of 2010 Apple, the maker of iPods, iPhones and IPADs, became the world’s most valuable company, a mantle which had been held by Microsoft. The two companies started the personal computer revolution in the 1970s but Microsoft had to date outflanked Apple to become the market leader. Hence, the significance of this turnaround in fortunes. Apple’s rebirth began with the launch of the iPod music player followed by its introduction of the smartphone, iPhone which upstaged the dominant mobile phone maker Nokia and then the launch of the computer tablet, IPAD. The significance of the changing in guard is on the role that consumers played in this change.

By launching IPAD, in January 2010, and releasing it into the market in April, Apple introduced a potential new product category in computers which is likely to change the way consumers interact with their devices. IPAD was able to meet a changing consumer need which saw them preferring to ‘swipe a finger across a touch screen’ instead of using a keyboard. More than 15 million units were sold in the first year alone. In a move which surprised many market watchers, Apple launched IPAD2, in March 2011, slightly more than a year after the first IPAD was released onto the market. Surprisingly!, because many marketers would have thought that IPAD1 had not yet gone through its full product life cycle. However, this move by Apple is in response to the changing competitive environment which has seen growth in the interest of tablet computers from competitors. Analysts predict the computer tablet market to treble in size in 2012. By launching IPAD2, Apple has left competitors playing ‘catch up’ in a growing segment with consumers hungry for new products. There are a dozen or more competitors with rival tablets to IPAD2 likely to be launched in 2011 from competitors like Microsoft and Toshiba.

Apple’s fortunes have largely been driven by a cultural shift in consumer tastes. Changing consumer tastes have increasingly overtaken the needs of businesses as the leading forces shaping technology. At the launch of IPAD2, Steve Jobs, Apple’s Chief executive officer ,declared that the world was entering a ‘post PC-era-one in which consumers are no longer glued to their desktop but to a fantasy world using tablets and smartphones. By launching IPAD 2, Jobs indicated that Apple was responding to the ever changing needs of its customers who lived in a fast paced technological environment. This fantasy world is reflected by the demand for Apple’s products. IPAD2’s launch has been no exception to Apple’s customers traditional habit of waiting in long queues around city blocks in order to be the first ones to buy the product. Apple’s ability to understand its customers is often cited as one of their key strengths which allows them to dominate the market and create barriers for entry for any new players. The Apple logo now signifies a brand that is innovative and understands customers’ needs. The success of the IPAD defies generally held beliefs about consumers’ attitude towards technical products. There is an assumption that consumers are unlikely to switch to new technical personal device products which might require a lot of adaptation to the new applications. Apple sold more than 8 million units in its first six months! IPAD 2 is a continuation of Apple’s philosophy to always create a new product and be at the forefront of meeting changing consumer needs.

The Apple store is viewed as a shrine which determines a large number of consumers to choose Apple’s products instead of competitor brands. The IPAD2 launch included coinciding with 5 pm news bulletins and infrequent shortages of the product which creates even more demand for the product. Apple employees were ready to serve and provide information on the significantly upgraded IPAD2 to loyal and new customers who had spent time in the long queues.

However, it is the experience and feeling of being part of Apple’s products users which drives consumers to make this sacrifice of staying in queues overnight as one confessed ‘Applelite” queuing for the new IPAD in Sydney summed it:

“It is the feeling and experience of spending time in this queue chatting to fellow ‘Apple mad consumers and building up to the hype and expectation of being among the first people to lay your hands on the new IPAD that counts more. To me it’s more than just waiting to buy a device but it’s about anticipation for an experience and fantasy that lays ahead in using my IPAD’.