Thursday 26 August 2010

"Mac" as Rorschach

With all the talk about the importance of the so-called Apple ecosystem (the interrelationship between the company's various mobile devices and its controlled app sites), we sometimes forget that role that trademarks still play for the company. In the main, the company's marks are unambiguous ambassadors of the company's goodwill and reputation. Thus "Apple" still presumably serves as the company's house mark, with branded devices "iPod", "iPhone" and "iPad" each clearly identifying a distinct mobile device as part of an expanding family of such "i"-branded products..

And there is the "Mac" (or its full name at its heraded 1984 baptism--"MacIntosh"). From its promotional inception via the legendary advertisement aired as part of the Super Bowl in the U.S. here, "Mac" has come to symbolize the iconic personal computer product made and sold by Apple. Unlike other company marks, however, it appears that the "Mac" mark no longer connotes a clear and unambiguous product message. This was suggested in a brief report ("Why the Mac is Still a Rock Star at Apple") that appeared in the June 28th issue of Bloomberg Businessweek.

The thrust of this short article was to describe the place of the "Mac" product line to the overall commercial success of the company. Thus, in Q1 of 2009, the "iPhone" accounted for 27% of company sales, while the "Mac" accounted for 33%. In comparison, in Q1 of 2010, the figures were 40% for the "iPhone" and 28% for the "Mac". But sales of the "Mac" are particularly profitable. At an average price of $1,300, it enjoys a gross margin of 30%. Compare that with Windows-based machines, whose average price is $687. Looked at from another angle, each one-half point of market share that "Mac" gains boosts sales in the amount of $3 billion.

One analyst, Charles Wolf, expects nearly 13 million "Mac" computers to be sold in 2010, and these sales numbers represent a continuing upward trajectory since 2004, when the company sold only 3.29 million units for the entire year. These are certainly impressive sales figures and it would seem to argue that the "Mac" product remains central for the company.

Well--maybe not exactly. In his June 7th launch of the new version of the "iPhone", Steve Jobs mentioned "Mac" only twice. As well, the company's "I'm a Mac" television ads no longer appear on the company's website. There does not seem to be any campaign which is specially planned to promote the "Mac." Indeed, the opposite is suggested. Thus Wolf observes that the line of "i"-based moible devices may well draw customers to consider the "Mac".

But drawing the customer to the "Mac" based on the aggregate goodwill of "Apple" and the "i"-based mobile devices is not enough. The company apparently believes that it needs to continue to add bells and whistles to the "Mac" computer (such as an apparent patent filing for an invention that will embed a projector into the computer and thereby enable it to turn every wall into a potential screen) to maintain its attractiveness.There is no suggestion that, as a strategic matter, the opposite is true, namely, attracting a "Mac" purchaser to add one or more "i"-based mobile products of the company.

If this is true, the "Mac", as profitable as it appears to be, is on its way to becoming an increasingly niche product for the company, being more served by the reputation and goodwill of the company's other brands, rather than being the driver for such reputation and goodwill. Stated otherwise, the treatment of the "Mac" mark provides a tantalizing insight into the strategy of the company for the foreseeable future.

Oh yes--I own an 'iPod", but no "Mac", 'iPhone" or "iPad". That may be my own form of hi-tech Rorschach.

More on the Rorschach test here.

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