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Apple's disruptive decade draws to a close

News, 29 June 2017
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LONDON/CUPERTINO: Apple's entry into the phone market ten years ago today established a new category within a category - the smartphone – and began a seismic shift in consumer expectations for communications which is only now slowing.

Writing in Admap, Martin Guerrieria, Global research director/senior client director at BrandZ, observes that the iPhone, quickly became the standard by which all mobile devices are judged.

A truly disruptive innovation, its impact on existing key players "was colossal and even insurmountable for some", he says – Nokia being the most high-profile casualty.

Since then, Apple "has moved from being perceived as a Specialist brand, to being classed as an Iconic brand – one that dramatically stands out on the three key BrandZ criteria of Meaningful, Different and Salient – in markets like the US, UK, China, Japan, Brazil and Mexico".

Sustaining this position, however, has become increasingly hard as rival smartphone brands like Samsung have scored higher on the Meaningful index and as new Chinese brands offer similar functionality at a much lower price – forcing Apple to launch a 'budget' offer, the iPhone SE.

That concession is symptomatic of how things have changed in the ten years since the first iPhone, with a feeling of stagnation now pervading the market, according to Guerrieria.

"Globally, all players in the smartphone market are struggling to excite consumers. Incremental improvements to screen sizes and cameras just don't generate a high level of curiosity and certainly don't offer the same opportunity for differentiation that they once did."

The battlefield is shifting from the device itself to embedding consumers into the brand ecosystem, he argues – something Apple already excels at.

"A consumer with an iPad, iMac and iPhone, who accesses music through iTunes and stores and accesses photos via iCloud, is much more likely to upgrade to the iPhone 8 – unless a competitor can offer a very compelling reason to move elsewhere."

Such a reason may emerge from game-changing innovation in areas such as artificial intelligence and augmented reality, Guerrieria suggests. Or Apple may surprise the world once more.

"The race for the next iLE (iPhone-level event) is on. The question is, who will deliver it?"

Data sourced from Admap

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