Beware the 'iPhone Effect'

Long suspected, seldom discussed, the iPhone Effect is very, very real -- and can have a dramatic impact on your business.
One Father's Day I was given an iPod touch. Didn't need one, didn't even want one, but like many unexpected gifts it turned out to be pretty neat. Since Howard Stern wasn't available on the iPod app my Sirius Stiletto became partially obsolete, but what the heck.

Then I got an iPhone for a birthday present. (Everyone else in my family loves Apple products, and like all self-respecting Apple-ophiles think I should love Apple products too.)

Now my $300, 32GB iPod is an expensive paperweight. (Just like two others in the house.) My iPhone does everything the iPod does and more. My Stiletto also gathers dust since Howard is on the Sirius iPhone app.

Today those items sit less than proudly on my "Purchases That Seemed Like a Good Idea At the Time But In Retrospect Were Kinda Stupid" Shelf of Shame.

I'm guessing you have a Shelf of Shame displaying your casualties of the iPhone Effect: New trumps old, fast trumps slow, better trumps really good, and "innovative" always trumps the less than trendy.

Most of us also have business Shelves of Shame due to a tireless search for the next best thing. We're overwhelmed and overworked and eager to suspend disbelief just long enough to convince ourselves that this purchase will truly make a difference in our working lives.

But it usually doesn't. To prove it, I looked around and realized I tend to stick with stuff:

• I have a Dell desktop that is eight years old. I only use it for a few tasks so I don't need a faster processor, more memory, or better graphics.
• I use Photoshop CS1 for editing wedding photos even though the latest version is CS5; I'm sure all the upgrades are really exciting but ultimately unnecessary, at least for me.
• I have a 2006 Hayabusa; the 2011 is lighter and makes more horsepower (but hey, bring one on -- I'll still outrun you.)

• Can we really afford this? Failing to financially justify a purchase is a sure sign the purchase is destined for the Shelf of Shame. Statements like, "We need this," or "Our competitors use this," or "I saw a great review of this," aren't justifications. Every purchase is an investment that should generate a return. "Want" is intangible and almost always a cash flow assassin; "need" can be quantified.
• Will we get tangible benefits we really need? Blazing fast may be irrelevant if fast is more than enough. Greater convenience could actually be a detriment; although you could, say, receive information more frequently, do you really want more distractions than you already have? If you find yourself saying, "You know, I really think this might help...," let it go. You're talking yourself into a purchase.
• Are we stopping short of the real solution? Say you're thinking about buying an iPod touch. In my opinion, that's pretty silly. Just buy an iPhone and get it over with. If it turns out you love the iPod you'll eventually want an iPhone. Or say you're thinking about purchasing enterprise software but you can't afford the right package so you get an off-the-shelf partial substitute. If you can't afford the solution that makes the best business sense, sit tight. Spending less now will only cost you more later because you'll eventually discard this solution for the solution that was better all along.

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