Apple Flubs iPod Event, Marketing Changing?

Last Updated Sep 10, 2009 11:45 AM EDT

Apple has been the greatest corporate master, perhaps, of the event: keep a tight lid on announcements before, invite the faithful, have Steve Jobs bring in the worship, and keep people on the edges of their seats until the end. But reaction to its announcement of new iPod models yesterday suggest that the master chef's knife slipped, nicking it rather than the market.

The new products were "a snooze fest for any Apple fans expecting new, must-buy products". People knew about the new products coming out and were disappointed when the expected video camera addition to the iPod touch didn't appear. Instead, the video capability is going into the new iPod Nano. Roughly 40 minutes into Jobs's presentation, Chris Nuttall from the Financial Times live blogged, "I'm sorry, but can we get to some news" and later added, "so yes, the nano looks great, nice iTunes improvements, but underwhelming otherwise".

However, much of the media -- other than a few exceptions like VentureBeat -- generally seems to have missed the importance of all the gaming announcements. Yes, I understand that everyone wanted a shiny new toy, but the gaming goes to strategic positioning issues:
  1. Games are a big driver for some of the hottest and best-performing areas of consumer electronics.
  2. Games can be a way to drive acceptance of devices in a broader context than they've appeared before.
  3. Macs have traditionally lagged in the gaming market compared to PCs.
  4. Games have been a big driver of apps sales for the iPhone.
Therefore, Apple knows that it needs games to continue its transition into a consumer electronics company, and it's taking the necessary steps. As Jobs said to the New York Times:
"Originally, we weren't exactly sure how to market the Touch. Was it an iPhone without the phone? Was it a pocket computer? What happened was, what customers told us was, they started to see it as a game machine," he said. "We started to market it that way, and it just took off. And now what we really see is it's the lowest-cost way to the App Store, and that's the big draw. So what we were focused on is just reducing the price to $199. We don't need to add new stuff. We need to get the price down where everyone can afford it."
Only, the company didn't get that across to the media for the most part, or maybe the reporters and editors didn't latch on to how important this was. In either case, it was as big a marketing miss as being underwhelming.

In the same interview, Jobs also provided insight into how Apple sees the e-book market:
He said that Apple doesn't see e-books as a big market at this point, and pointed out that Amazon.com, for example, doesn't ever say how many Kindles it sells. "Usually, if they sell a lot of something, you want to tell everybody."
Although it seems like an obvious point, it actually misses the market dynamics. E-books sell for less than regular books, publishers only make as much as in regular print because Amazon is subsidizing their results for them, and the publishers are concerned about Amazon having too much control. I could see some good reasons why the retailer would want to be cagey about the number it sold, as it has bigger goals than just selling devices.

Such a market misreading is unusual for the company. Combined with the results of yesterday, and you have to wonder if Apple is having a bad day, or whether shifting markets and conditions are showing that ingrained approaches to business may not work.

Image via stock.xchng user sateda, site standard license.
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    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.

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