While Samsung’s latest viral campaign is relatively new, it is having an impressive impact approaching a whopping 47M views in one spot and 12M additional in another. In contrast, Apple’s 3 competing viral ads only reached around 16M people - which typically would be a good showing but when you take into account the Samsung stuff wasn’t even targeted at the U.S. and still went vertical, you have to realize something else is going on. These rankings and the viral spots, which are worth checking out, are on AdAge this week.
I think this performance represents a growing anti-Apple sentiment which could be problematic for the company largely because there is no magic in what the company announces and the products are increasingly “me-too.” Just as damaging is their treatment of the celebrities and the nude photo scandal, instead of protecting them or at apologizing while Apple fixed their security, they threw them under the bus and fixed the horrid security. Suddenly a lot of very influential people have gone from Apple fans to Apple haters - which I think is helping drive the viral storm against Apple.
Apple Is More about Image than Product
Apple is a status brand. When you see the prices of the unsubsidized phones approaching $1,000 and realize that a lot of folks spend less on their cars then on their iPhones, now you realize that many, if not most, are buying Apple for the brand. And there are far more people who get excited about brands than those that get excited about technology. However one of the things that can damage a brand tied to status over time is the slow bleed of visible, low status buyers using a product.
Cadillac almost destroyed themselves with this problem a number of years ago when they decided to launch an ad campaign that showcased the folks that drove old Cadillac cars. Once they collected the data they found that a lot of the folks who drove old Cadillac’s weren’t exactly pillars of society. I expect they found an uncomfortable number who actually lived out of their old cars. Once they got the initial results from the campaign in, they killed it and I expect the folks that came up with the idea now have lucrative careers flipping burgers someplace.
If you watch how the luxury car brands market, they focus on attractive, rich people as their ideal customer because folks aspire to be like them, they don’t focus on the folks that probably can’t afford the cars even though these folks more likely to represent the actual buyer.
So a lot of the reason why Apple can get nearly $1K for some of their phones and tablets is because they maintain the fiction that this is what influential people buy and they have an inordinate number of influential buyers (many of which likely get free phones from the company, it’s good to be influential).
This is part of what made Steve Jobs different. He could get up in front of a crowd and appear as the celebrity he was. The events were well orchestrated, he was tidy with his own unique image, and he spoke to the elitist in most of us. He told us that the smart people bought Apple products and we believed. I think most of Apple’s buyers still do.
However we are seeing cracks in this façade. People are starting to complain more vocally about Apple, the announcements lack magic and Tim Cook lacking personal style. Jobs was a celebrity-Cook another CEO, in the end, people are slowly coming around to the idea that the iPhone is just another phone and increasingly an overly expensive one at that. If you overpay for something, you are kind of stupid. Thus, without Jobs, Apple buyers are increasingly being equated to people who don’t know any better rather than people you’d want to emulate. And I think both Samsung and to a lesser extent, Microsoft, get a lot of the credit.
Attacking a Brand
Both Samsung and Microsoft aren’t attacking the Apple technology so much as they are attacking the perceptions that surround the brand. Both are pointing out shortcomings to the Apple products and Samsung in particular is portraying Apple buyers are mentally deficient. Now I’m not convinced this kind of campaign alone will do much to increase the sales of their own products directly, but they clearly are having an impact on impressions - which is why the viral numbers are so high. People push things they agree with and far more are pushing the Samsung spots than they are pushing the Apple spots – suggesting they are more likely to poke fun at their Apple buying friends.
Wrapping Up: Death of a Brand
What I find particularly troubling is that Apple doesn’t appear to be trying to defend their brand and is assisting in its destruction. Throwing the celebrities with the nude photos under the bus is only one in a series of incidents where Apple itself seemed to try to make buyers of Apple products appear foolish. They had Antennagate where thy tried to convince us to hold our phones like tea cups so the antenna would work, they had the Olympics ads that wanted to promote Genius Bar employees but instead made Apple users look mentally challenged, and even though it was obvious folks liked bigger screens, they suggested Apple users were too dumb to see the advantages. I guess the latest announcement of larger phones suggests Apple users actually aren’t that dumb after all.
So ask yourself, when you look around, do you think the smart people buy Apple products or the not so smart people? If you are like most, you are likely drifting or already in that latter class. Long term, this is a problem for Apple.
President and Principal Analyst, Enderle Group
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