Term Review as part of the Product Strategy & Management course at IIM Bangalore.

2. Learnings in branding from the architectural genius
of a brand new retail format called the “Apple Stores”

3. Steve Jobs used to say: “If Apple is going to succeed, we’re going to win on innovation…
and you can’t win on innovation unless you have a way to communicate to customers.”
Learning – “Communication and physical expression of an organization’s offerings are
as important as the offerings themselves.” Overall experience is key!
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Apple Stores: A physical expression of their
products: playful, easy, creative yet impressive
David Aaker’s Framework2 :
Truly new
product/service
Branding creates differentiation: Anything can
be branded; features, service, program or
ingredients, as long as they are relevant to the
customer1
What to
brand?
Jobs said: “Make great products BUT more
importantly get people curious by making them
inviting enough.”
Holding relevance
for customers
Revenues/Bottom
line contribution
Sustainable
Competitive
Advantage
Needs resource
allocation over time
Moving
target?
Parallels from Indian Context
Fabindia – Branded traditional Indian wear
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Differentiated commodity products!
Stores: One swipe grasp of layout
Reflect the brand philosophy of
‘Indianization’ of offerings
Immense brand loyalty towards Fabindia

4. If something isn’t right, you can’t just ignore it & say you’ll fix it later. That’s what other
companies do. We’ve got only one chance to get it right. – Jobs about Apple’s Stores
Learning – “Competitors and customers won’t give you a second chance if you get it
wrong the first time. (this holds even if you’re an iconic brand!)”
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Last minute revamp of Apple Stores at the cost of a
four-month delay in the rollout
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Why? Because the layout should be right to provide
the appropriate customer experience
Parallels from Indian Context
Toyota - has recalled 500,000+ Prius
models since 2009
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Coca-Cola (Coke) - Rapid folding of
it’s knee-jerk response “New Coke” to
Pepsi’s popularity
Concept Development
Framework3: Apple Store
Idea Generation
Striving till you get it right!
Screening
Concept
Formulation
Service
Development
Tata Nano – Several recalls over
engine-fire issues. Sales? Brand?
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Business
Analysis
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Evaluation via
concept testing
YES
Is concept
suitable?
NO
Concept
Reformation
• ‘Right’ is when the brand experience caters to what
customers want to do, not to glorify products
2 years

5. Learnings from the path-breaking product that turned Apple’s
fortunes through continuous innovation: “Apple iPod”

6. The iPod became the essence of everything Apple was destined to be: poetry connected
to engineering, arts and creativity intersecting with technology and a design that’s bold
and simple and integrated end-to-end ease of use.
Learning: “Truly breakthrough innovations invariably have to be at the cutting edge of
both creativity & technology. Not to forget, they need to be promptly branded.”
Food for Thought – “Designing iPod”
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Integration of hardware, software and operating system,
but innovate to push complexity behind the scene
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Simple, elegant and intuitive – a new way to do an old
thing with some excitement features thrown in (later)
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A beautiful product with a theme: A 1000 songs in your
pocket – a Drive to store it, a wheel and intuitive interface
to browse through it, a battery that could play it and a
cable that could transfer everything in 10 minutes
Name was distinctly Apple – “iPod”
Scroll Wheel
Designed for perfection: “Pure
White” body with Aluminium back
White headphones + accessories
“… It just understood your emotional
and intensely personal relationship
with your music… ”

7. I had this crazy idea that we could sell just as many Macs by advertising the iPod. So I
moved $75 million of advertising money there, even though it didn’t justify 1/100th of it.
Learning: “Seemingly irrational business decisions may result in huge payoffs if we can
cash in on the positive externalities. But be sure its backed with a strong brand!”
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Massive advertising campaign launched for the iPod
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Triple Bang: drove sales of iPod + sales of Mac + lend lustre
and youthfulness to the entire Apple brand image
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What was the result?
• Dominated music player market for years, still does!
• iPod positioned Apple as “innovative and youth”
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How to decide?
The Digital Hub – Jobs’ Vision for iMac
Truly new product/service
New way to do an old thing –
‘superior experience’
Revenues/Bottom line contribution
Huge iPod sales, increased Mac sales
What to brand?
Apple’s New
Music Player
Holding relevance for customers
Changed the way music was
heard. Loyalty for Apple.
Sustainable Competitive Advantage
‘iPod as the standard bearer’ ‘Apple as an
innovative company’
Moving target?
Requires resource
allocation over time
Potential to maintain innovation-based
differentiation using line extensions

8. Jobs & his team were able to keep coming up with new versions of the iPod that extended
Apple’s lead... The iPod Shuffle was even more revolutionary with ads reading “Embrace
Uncertainty.” Jobs view was “If you don’t cannibalize yourself, someone else will.”
Learning: “Product leadership can be maintained by incremental innovation with new
excitement features without being averse to cannibalization. In short, don’t settle!“
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Classic, Nano, Shuffle, Mini, Touch enhanced iPod brand
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Launched at different price points: cannibalization was ok
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iPod Mini: designed using customer consumption chain,
usage by athletes/sportsmen, clipping facility was USP
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iPod Shuffle: Brought a number of excitement features
• Shuffle feature of earlier iPods was realised as huge
excitement feature  “Embrace Uncertainty” 
Song randomness became obsession with users
• Later followed up with incremental innovations like
‘Genius Playlists’ and ‘Genius Mixes’
• Shuffle’s ‘VoiceOver’: made up for the lack of screen
Parallels from Indian Context
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Maruti Suzuki: models with
incremental differences across the
price points right from first small
car to high-end SUVs/sedan
• WagonR, Eco and Ertiga are
examples of models targeted
at customer usage situations
• Often overlapping features in
adjacent models  leads to
cannibalization of models,
but that’s okay!
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Samsung Mobiles: Another
example of a company which uses
cannibalization as a market
leadership strategy.

9. Learning from the phenomenal success of the
“iTunes Store” – a classic case of platform innovation

10. Because the companies were worried about pricing model & unbundling of albums, Job
pitched his new service “iTunes Store” would be only on the Macintosh, a mere 5% of the
market. “We used our small market share to our advantage…” Jobs said.
Learning: “Brand relevance drives market dynamics - establish successful leadership in
subcategory before repositioning globally as a market leader. “
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Realised that winning subcategory battle1 was more
important & effective than winning brand share fight
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Positioned the new iTunes Store in a rather small
subcategory of Macintosh + iPod owners only
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Tied the subcategory with established Apple ‘i’ brand
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Promise of simple, safe, legal downloads for 99 cents
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Benefit of an ecosystem (iPod, iTunes, iMovies, iDVD)
got the music labels to go along with the “package”
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Established itself as winner in this narrow subcategory
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Repositioned as global leader by porting iPod, iTunes
and Store to Windows, music labels readily agreed!
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Competitor response: “We were smoked.” - Microsoft
Food for Thought – “Brand Relevance”2
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Identity of leading firms driven by
new categories or subcategories
supported by a distinct vision
Change what customers buy, give
things they refuse to do without
Competing brands lacking those
characteristics become irrelevant for
an extended time (eg: Sony vs Apple)
Parallels from Indian Context
Balaji Chips – targeted
quantity conscious buyers,
bulls-eye concept to easily
proliferate other markets in
midst of high inflation

11. Learning from how Apple rekindled a whole new category
of devices written-off long back with the “iPad”

12. Jobs said: “It’s got to make a statement. It needs to be a manifesto. This is big. The iPad
is revolutionizing the world. We need ads that stand up and declare what we’ve done.”
Learning: “In the introductory phase, of a new product, communicate the “Voice” i.e.
the core benefits of the product first to build customer brand equity.“
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The 1st TV commercial of iPad had no words. 
Jobs hated it saying it’s a “typical soft cute ad”
He wanted to “Explain what the iPad was” all about…
Before other companies come out with copycats,
people should remember “iPad was the real thing”
Every Brand has a “Voice” – Distinctive benefits
Apple’s Voice - “Simple, Declarative, Clean”.
2nd ad (which aired) extended that “Voice” to iPad
iPad commercials were not about the device but
about what you could do with it
Follow up ads - Clean white background which tells
the message “The iPad is…”
Food for Thought – “Build Customer Brand Equity”
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Introduction phase for products which aren’t purely
functional– marketing to build user perceptions
Ads should focus less on features or specs but on
benefits or experiences – what “job” or activity you
could perform with the product
Building Associations…
“iPad is thin. The iPad is beautiful”- Clean
“You already know how to use it” - Simple
“It’s already a revolution” - Declarative
Parallels from Indian Context
Dettol Kitchen - Focuses on job!
1) Voice – Clean & germ-free
2) Attempts to extend existing
Dettol brand to Kitchen Gel

13. There’s one more thing… Thanks!
Questions?