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November 2012

A Product Positioning Case Study: The Real Reason the iPad Mini Was Steve Jobs' Biggest Nightmare

I have had my iPad mini for three days now, and it is an amazing device, one that has already fundamentally changed my daily productivity habits. Like most reviewers have pointed out, weight is the killer-app of the mini. It has hit a form factor sweet spot that inspires me to carry it all day from meeting to meeting as my primary mobile productivity device. I am experimenting with Evernote® and I am officially retiring my decades' long companions of a paper notebook and pen for meetings, which is huge because I like a nice pen and pad. As an owner of several iPads and a Dell XPS13 Ultrabook, I can also attest that neither of these excellent devices came close to inspiring such a fundamental shift. But under the surface of this breakthrough is a tectonic, post-Jobs change in product positioning strategy at Apple.iPhone 5 vs iPad Mini

For years Steve Jobs was anti-mini with the alleged push back centered on usability and ergonomics of smaller screens and human fingertips. Maybe that was the case, but I think something more philosophical may have been the reason. Steve Jobs was not only a zealot for clean, elegant design, but for clean, elegant positioning. The bright lines have always been very clear between Apple products. If you want a computer, you buy an iMac for the desktop or a MacBook as a laptop. The value propositions between the Shuffle, the Nano, and the Touch have always been distinct. And if you were looking for a mobile iOS device it was an iPhone or an iPad ‒‒ all very clear, neat, and tidy designed to make it easy for customers to choose. But in reality, there was no choice, the position was always made very obvious, and that was the beauty of the Apple consumer experience model.

The iPad mini just slammed a wrecking ball through that model and I am sure that Steve would not be happy about it. Don't get me wrong, I love the device for all kinds of reasons. It has without a doubt very quickly become my primary iPad. My original iPad and iPad2 have become family communal property to be polluted at will with episodes of iCarly, Fashionista games, and whatever other apps young girls can't live without. So where is the positioning problem? Sounds like a win-win for everyone.

In short, I never want to touch my iPad2 again and even worse, I am not sure I still want an iPhone (or at least not one like I have now). The iPad2 feels old, heavy, and clunky ‒‒ something I've never said about an Apple product. They need to bring a new one out fast!

But the real rub is the iPhone. Now I walk around all day carrying my mini and my iPhone as a pair. But wait, the mini is my primary device, and it does almost everything so much better than my iPhone. It is so far superior for checking e-mail, calendaring, and browsing that my iPhone feels like massive overkill. Within a day, I concluded that I wanted a simple little phone that does phone calls and allows me to text. I have almost no desire to run apps on my iPhone anymore! My phone is quickly going to become my application device in airports, and if I had an LTE mini it would be even worse.

The positioning bright line is gone. The simple buying experience is gone. Sure, we have always hoped for a better iMac, iPad, or iPhone, but now we are hoping for completely new products in new categories, like a basic, "non-smart" phone ‒‒ a "non-smart" phone that would put a $75B iPhone franchise at risk. If I had the LTE-iPad Mini, I am convinced I would no longer need a smart phone (but to be clear I definitely do not want to hold my iPad mini up to my ear like some kind of Galaxy Note mutant). Without the bright positioning lines consumers are confused about what to buy. I have talked to many Apple devotees who are unclear about the implications of buying an iPad mini, the use case trade-offs conflicting their brains. This phenomenon is long rampant in the WinTel world and mainstream consumer electronics, but it has never been the case with Apple.

This is where it is clear the Cook-era is firmly upon us: a rational, business-driven approach that frankly is hard to argue with, but is counter to Jobs-era of positioning products. In classic consumer packaged goods (CPG) strategy, brand managers look to cover every use case with brand extensions to maximize share of shelf space within retail channels. This is how we end up with 15 different kinds of Windex®, none of which we are sure is the original ‒‒ the only one we actually want to buy. With the iPad mini, Apple felt compelled to fill the shelf space, cover the competitive threat, and maximize revenue by covering every SKU ‒‒ it's textbook and makes perfect sense to Tim Cook (but not to Mr. Jobs).

We will have to see how it plays out, but what an amazing product positioning case study we are watching. Maniacal simplicity (Jobs) versus a classic CPG maturity model (Cook). Will it all be justified by higher revenue across all products? That is the theory. But what will be the impact on the Apple brand and its legacy of simplicity? Of course it will be hard to truly judge, but as a marketer we are watching the nexus of the Job instinct model versus the Cook analytical model. Will the the end justify the means or is it a slippery slope? You can hear the rationalization inside Apple, "It's ok this time, we need to respond to Google, and hey, it's a great product and we will make more revenue anyway." Hmmm…