Apple: “Master of innovation” or “Master of perfection”?
Innovation has undeniably become an essential tool to prepare the future of a company. Indeed, each company can resort to innovation to serve a particular purpose. Stim has identified 4 key innovation profiles, with each of these different profiles associated with its own level of effort and expertise: the Game-Changer, the Performer, the Differentiator, and the Derisker. From their performance in the past, Apple could be described as a Game-Changer: a company which aims to bring radically new designs to the market and to deeply transform its industry and ecosystem.
This month, Apple revealed its latest keynote. Yet today, the firm’s innovations look far less disruptive than they once were. Indeed, they seem more like existing products or services: wireless earphones, longer-lasting batteries…Has the American giant switched its innovation strategy? Can it still be defined by its noise-making innovations, as it once was with the introduction of a platform such as iTunes or with the release of the iPhone?
How Apple built its Game Changer reputation through its innovations
On April 1st, 1976, Apple Computer was launched, by Steve Jobs and Steve Wozniak. This date marks the beginning of a story that neither of the two tech geniuses could imagine. They had just commercialised their very first computer: Apple I.
Years of innovation to revolutionize tech use
Over time, Apple has progressively revolutionized several technological and cultural segments. First, it has brought about a brand new design experience, through its first computers. For the first time ever, using a computer was becoming a pleasant experience, which would later become increasingly simple and elegant. Through the 80s, 90s and 2000s, Apple was undeniably becoming a Game Changer. Thanks to Steve Jobs, the – now – American giant successfully designed and launched the Macintosh, 1st GUI-equipped computer, followed by the iPod, which revolutionized the music device industry, wiping out Walkmans and other MP3 players. Building on this momentum, iTunes shook the music industry by providing software that perfectly complemented the hardware. The Macbook and its variations, as well as the iMac, furnished with MacOS came next, making the laptop user experience “sexier” than ever.
How the iPhone propelled Apple forward
Then, in 2007, the iPhone was announced. It is this very innovation that would change the game, as stated in the famous keynote of Steve Job: | “Well, today, we’re introducing three revolutionary products of this class. The first one: is a widescreen iPod with touch controls. The second: is a revolutionary mobile phone. And the third is a breakthrough Internet communications device. So, three things: a widescreen iPod with touch controls; a revolutionary mobile phone; and a breakthrough Internet communications device. An iPod, a phone, and an Internet communicator. An iPod, a phone … These are not three separate devices, this is one device, and we are calling it an iPhone.” 12 years and over 10 new designs down the line, the iPhone has managed to create its own market, its own client base and one of the strongest brand names.
Since then, Apple has kept on offering innovative products, yet with uneven success. For instance, the Apple Watch, failed to make connected watches a new standard for the general market. Similarly, the Apple TV, in spite of continuing to seduce the brand’s well-established fans, failed to convince other consumers. While increasingly common, the Airpods, first wireless earphones on the market, are still considered too expensive by a broad range of consumers. One cannot deny that Apple’s innovation portfolio is rich in terms of value proposition and expertise. It has earned the firm its billion-dollar revenue, as well as its well-established position among the GAFAM.
A strategy shift
Since the mid-2010s, Apple’s innovation-perfection ratio seems to be shifting as they hardly bring in groundbreaking technologies to the market in recent years.
Recently, analyst Toni Sacconaghi has estimated that Cupertino’s firm wasn’t investing enough in Research & Development compared to its competitors (2% of its cash flow invested in R&D versus 25%). More surprisingly, in 2019, when Fast Company published its latest ranking of the world’s most innovative companies, Apple fell from 1st place…to 17th. Is the tech giant resting on its laurels?
Apple is slowly replacing its radical innovation strategy with a more substantial and incremental approach and a relentlessly more thorough work on design and perfection. However, this change, of course, is quite misunderstood by the general public, which often judges Apple’s new products to be less value-bringing than the previous. The increasingly high prices reinforce the beliefs of the most reluctant: Apple would have become a luxury brand that sells “premium” products (in other words, products which are easy to use, high-performance, and with elegant finish). It is true that, in a sense, there has been no major breakthrough in the past couple of years, not even a new iPhone or Macbook design. Perhaps we will witness, one day, a new breakthrough with the launch of an – electric and autonomous – Apple Car.
Pursuing perfection at the expense of innovation: a winning strategy for Apple?
Despite all of the above, Apple’s revenue is continuously spiking up, and its brand image keeps reinforcing itself. Here lies the essence of its strategy: becoming a “Master of Perfection”. Apple products are not purchased for their quality and technological superiority anymore, but for the powerful brand image they convey. Certainly, the brand’s ecosystem also plays a big role in its success by fostering a sense of belonging and community among its users. Besides, providing a single login id to the user – common to all their Apple devices – gives them easy access to all of the brand’s services. In fact, Apple’s user-friendliness is one of its most valuable assets.
Lastly, it is hard not to notice the tremendous number of trends that Apple has initiated (on purpose or not), most of which are the result of simple design choices. For instance, the whole market has followed suit on details such as the smartphone notch, steel-coloured laptops, and wireless earphones. Purchasing from Apple is not about opting for cutting-edge technology. It is more about choosing the most impeccable design, a simple and flawless user experience, and a premium experience.
Henceforth, Apple is rather a “Master of Perfection” than a “Master of Innovation”. This trajectory could be compared to Nokia’s or Kodak’s. Yet little time after turning their backs on radical innovation, both of these companies were toppled by competition. Is Apple’s new positioning slowly changing the company for better… or for worse? How long is success going to last after this change of direction?