The Psychology behind the iPhone How does an over-priced product with limited functions become so successful, and have a devoted fan-base? A critical review.

The Psychology The Psychology behind the iPhonebehind the iPhone

How does an over-priced How does an over-priced product with limited functions product with limited functions

become so successful, and become so successful, and have a devoted fan-base?have a devoted fan-base?

A critical reviewA critical review

Prof. Craig Jackson

Head of Psychology DivisionBCU

[email protected]

Technological Development – Ages of ManTechnological Development – Ages of Man

StoneStoneIronIron

CopperCopperBronzeBronze

SteelSteelSteamSteam GasGas

ElectricityElectricity SiliconSilicon

AnalogueAnalogueDigital Digital

CommunicationCommunication Post DigitalPost Digital

Nano Nano

Everyone’s a CriticEveryone’s a Critic

Technological DevelopmentTechnological Development

Speed of product innovationSpeed of product innovation

Almost unstoppableAlmost unstoppable

UnsustainableUnsustainable

Reflect pace of modern life?Reflect pace of modern life?

Determines pace of modern life?Determines pace of modern life?

Future ShockFuture Shock

Context of Technological DevelopmentContext of Technological Development

Do Gadgets make us “frantic” ?Do Gadgets make us “frantic” ?

The sexiest words are . . . .The sexiest words are . . . .

uuPPGGrraaDDee

ccooNNnneeCCtteeDD

Context of Technological DevelopmentContext of Technological Development

Steve Jobs announced Jan 2007 that Apple would sell a Steve Jobs announced Jan 2007 that Apple would sell a product called iPhone in the yearproduct called iPhone in the year

Born on . . .Born on . . .

iPhoneiPhone June 9June 9thth 2007 2007

iPhone 3GiPhone 3G July 11July 11thth 2008 2008

iPhone 3GSiPhone 3GS June 19June 19thth 2009 2009

iPhone 4iPhone 4 June 20June 20thth 2010 2010

Newton’s FailingsNewton’s Failings

Replaced disastrous Apple NewtonReplaced disastrous Apple Newton

Stylus basedStylus based

Handwriting recognition dodgyHandwriting recognition dodgy

Learn “new” alphabetLearn “new” alphabet

LatecomerLatecomer

Slow to enter marketSlow to enter market

Policy of wait and see . . . Policy of wait and see . . .

iPhone ReviewsiPhone Reviews

Luke warmLuke warm

Mixed at bestMixed at best

Good but could do betterGood but could do better

Still popular with Early AdoptersStill popular with Early Adopters

UK Gadget Sales in 2008UK Gadget Sales in 2008

24,000,000 new phones bought24,000,000 new phones bought

6,000,000 digital cameras6,000,000 digital cameras

13,000,000 PCs13,000,000 PCs

8,000,000 flat screen TVs8,000,000 flat screen TVs

7,000,000 MP3 Players7,000,000 MP3 Players

Consumer electronic sales up 3% on 2007Consumer electronic sales up 3% on 2007

The First 2.5 Years in the Life of the iPhoneThe First 2.5 Years in the Life of the iPhone

The First 2.5 Years in the Life of the iPhoneThe First 2.5 Years in the Life of the iPhone

iPhone Worldwide SalesiPhone Worldwide Sales

Units sold worldwide (Millions)Units sold worldwide (Millions)

iPhone MindMapiPhone MindMap

1. Functionality1. Functionality

CameraCamera2MegPixel (3G)2MegPixel (3G)No video, zoom or flash No video, zoom or flash (3G)(3G)

iPodiPodLimited song libraryLimited song library

EmailEmailDifficulty with integrated systemsDifficulty with integrated systems

Direct ManipulationDirect Manipulation BrowserBrowserPinch, Wipe, ZoomPinch, Wipe, Zoom No FlashNo FlashCopy & PasteCopy & Paste No JavaNo Java

SearchingSearchingSpotlight searchSpotlight search

Mixed bagMixed bag improvedimproved satisfyingsatisfying could be bettercould be better

Reasons for using an iPhoneReasons for using an iPhone

Three Clicks from AnywhereThree Clicks from Anywhere

The real success story of iPod functioning . . . The real success story of iPod functioning . . .

. . . Absent from the . . . Absent from the iPhoneiPhone

BudsBuds

The other real success story of iPod functioning . . . The other real success story of iPod functioning . . .

Technically poorTechnically poor

Aesthetically greatAesthetically great

. . . Present with the . . . Present with the iPhoneiPhone

2. Aesthetic2. Aesthetic

LayoutLayoutClutteredClutteredLimitedLimitedNo personalisationNo personalisation

Look n FeelLook n Feel““iPhone black”iPhone black”Fixed FontFixed FontCurvedCurvedSolidSolidHeavyHeavyPackage Package White wiresWhite wiresConsistent with iPod familyConsistent with iPod family

GoodGood consistentconsistent simple interfacesimple interface makes digital feel analoguesmakes digital feel analogues

PackagingPackaging

BoxBoxSimple Simple CleanCleanHonestHonestCulturally neutral Culturally neutral

GoodGood consistentconsistent simplesimple promises contentpromises content

3. Campaign3. Campaign

GlobalGlobalConsistentConsistentCreativeCreative““Apple White”Apple White”LogoLogoYoungYoung

Rides on the back of successful Apple workRides on the back of successful Apple work

Investing in a stable successful companyInvesting in a stable successful company

Buying into AppleBuying into Apple

FaultlessFaultless sophisticatedsophisticated anti-marketinganti-marketing antithesis of Microsoftantithesis of Microsoft

Content of iPhone AdvertsContent of iPhone Adverts

Steve and Bill’s Excellent Adventures . . . Steve and Bill’s Excellent Adventures . . .

Riding on the back of successful Apple campaignsRiding on the back of successful Apple campaigns

UK iPhone Advert Banned!UK iPhone Advert Banned!

ASA banned UK iPhone advertASA banned UK iPhone advert

Misleading speed of web connections Misleading speed of web connections

““You never know which part of the internet you'll need ...You never know which part of the internet you'll need ...which is why all the parts of the internet are on the iPhone"which is why all the parts of the internet are on the iPhone"

4. Exclusivity4. Exclusivity

Single network onlySingle network onlyCombined with trusted providerCombined with trusted provider

LoyaltyLoyalty

StabilityStability

CunningCunning exclusive for 2 yearsexclusive for 2 years end exclusivityend exclusivity reduced price of new modelsreduced price of new models

5. Applications5. Applications

Content is the futureContent is the future

On-demandOn-demand

External developersExternal developers

ExcellentExcellent individualityindividuality tailor madetailor made regenerationregeneration

Marketing AppsMarketing Apps

Ads for Apps more than iPhone itselfAds for Apps more than iPhone itself

How People use their iPhoneHow People use their iPhone

Locations where People use their iPhoneLocations where People use their iPhone

Demographic of iPhone UsersDemographic of iPhone Users

Cultural SignificanceCultural Significance

Cultural SignificanceCultural Significance

““Podification”Podification”

Hooverization – “podcast” is generic term for “download”Hooverization – “podcast” is generic term for “download”

Hamburger statusHamburger status

Gadget PornGadget Porn

““Stuff “Stuff “

Variety of AppsVariety of Apps

Variety of AppsVariety of Apps

MockeryMockery

Personification of successPersonification of success

Cultural significance achievedCultural significance achieved

Flattery of iconic statusFlattery of iconic status

Still untarnishedStill untarnished roastingroasting envyenvy McDonaldizationMcDonaldization

Overdone & OverusedOverdone & Overused

Cool versus Functionality paradoxCool versus Functionality paradox

2 markets – iPhone & Blackberry - will converge2 markets – iPhone & Blackberry - will converge

Dilution of user-baseDilution of user-base

Product loses identityProduct loses identity

Users look elsewhere Users look elsewhere

iPhone Product FutureiPhone Product Future

iPhone Product FutureiPhone Product Future

Unquestionable loyalty (for now)Unquestionable loyalty (for now)

Network exclusivity deal ends in late 2009Network exclusivity deal ends in late 2009

Creative imagination of usersCreative imagination of users

200 plus patents in iPhone tech200 plus patents in iPhone tech

Pervasive monitoringPervasive monitoring

Embedded useEmbedded use

Touchscreen tablet Mac coming soonTouchscreen tablet Mac coming soon

10 Psychological Rules for Marketing an Apple10 Psychological Rules for Marketing an Apple

1. CEO must own the marketing function: no delegation

2. Marketing department must start small and flat and stay small and flat

3. Face-to-face with customers: direct interaction.

4. Use market research cautiously: prefer grassroots techniques

5. Hire only passionate missionaries

6. Love and respect customers as individuals, not as numbers

7. Create a community of consumers unified by certain brands

8. Rethink the marketing mix: e.g. short, targeted ad campaigns

9. Celebrate common sense and compete via different marketing ideas

10. Be true to the brand: brand integrity & quality

ConclusionsConclusions

A product launched to luke-warm reviewsA product launched to luke-warm reviews

A product lacking in many key featuresA product lacking in many key features

Despite this . . . the future still looks brightDespite this . . . the future still looks bright

But can only go one way from here. . . industry expert dissatisfactionBut can only go one way from here. . . industry expert dissatisfactionStill has wow factorStill has wow factorThe right sort of usersThe right sort of usersCool perception of usesCool perception of usesHealthy apps developmentHealthy apps developmentNeat marketingNeat marketingNot Microsoft Not Microsoft Analogue feelAnalogue feelAvoided ethical hiccups – manufacturing & exploding batteriesAvoided ethical hiccups – manufacturing & exploding batteriesGraduated product roll outGraduated product roll out

ConclusionsConclusions

1. The iPhone is pretty

2. It's touchy-feely

3. It will make other phones better

4. It's not a phone, it's a platform

5. It is but the ghost of iPhones yet to come

Weakest Links? - - iTunes & Battery LifeWeakest Links? - - iTunes & Battery Life

Poor interface. Poor Design. Syncing. Slow. CorporatePoor interface. Poor Design. Syncing. Slow. Corporate

Further ReadingFurther Reading

Apple Insider. 2007. Apple’s iPhone the No. 4 U.S. handset during third quarter. October 19. http://www.appleinsider.com (accessed February 9, 2008).

Burrows, P. 2008. Feb. 12. Inside the iPhone Gray Market. BusineesWeek.

Carew, S. 2008. Apple says has sold 4 million iPhones. Reuters.

Eisenmann, T., Parker, G., Van Alstyne, M. 2006. Strategies for two-sided markets. Harvard Business Review; 92-101.

Grossman, L. 2007. I take the iPhone Home. Time.

Olson, P., Laurent, L. 2007. iPhones Land in London. Forbes.com. (accessed November 9, 2008).

Wingfield N., Guth RA. 2005. Why Shortages of Hot Gifts Endure as a Christmas Ritual. The Wall Street Journal. December 2, B1.