EMRE KIRATLIEMBA 5202 BRAND MANAGEMENT HW 2

14.04.2011

iPOD: CREATING AN ICONIC BRAND CASE

STUDY

TABLE OF CONTENTS
I.
II.
III.
IV.
V.
VI.

I.

INTRODUCTION
THE MOST IMPORTANT FEATURE OF iPOD
iTUNES; SHOULD IT CONTINUE TO BE A CLOSED SYSTEM?
APPLES MARKETING PLAN FOR iPOD
APPLES DISTRIBUTION NETWORK; REACHABILITY VS CUSTOMER RETAIL
EXPERIENCE
THE FUTURE OF THE iPOD

INTRODUCTION

iPod, the invincible product line of portable media players of Apple Inc., literally
rocked the market since its launch in October 2001. During the decade,
297.000.000 units were sold worldwide1 and the whole product line maintains a
market share above 70%. There are currently 4 different variations on the
product line; iPod Classic (6G), iPod Shuffle (4G), Pod Nano (6G) and iPod Touch
(4G). If we look at the Customer Based Brand Equity model, we can clearly see
that Apple successfully satisfied the needs of each level.

1 Wikipedia (2011). http://en.wikipedia.org/wiki/IPod

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Imagery

Salience: Apple provided the market with a digital music player, perfectly capable
of storing and playing thousands of songs.
Performance: Large storage capacity and easily & effectively working, simple
control interface
Imagery: iPod is seen as a convenient and easy-to-use product.
Judgement: Apples perceived high quality and convenient innovations
accompanied with iPods proven quality supported the products place as number
one in the judgement seat.
Feeling: iPod, clearly invoked the feelings like freedom, excitement and fun.
Furthermore, iPod users became a community, thus creating a social acceptance
and a feeling of being part of a certain social level.
Resonance: High loyalty, strong attachment and a wide community of iPod users
worldwide.
In his book Best Practice Cases in Branding, Kevin Lane Keller analyzed the
success of the iPod in a detailed case study 2. This article will try to answer
Kellers questions at the end of the case study 3.

II.

THE MOST IMPORTANT FEATURE OF iPOD

2 Keller, K. L. (2008). Best Practice Cases In Branding. New Jersey: Pearson

Education Inc. P. 153-174
3 Keller, K. L. (2008). Best Practice Cases In Branding. New Jersey: Pearson
Education Inc. P. 168
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In the first question, Keller asks

what is the most important feature
of the iPod and why? The answer to
this question is simplicity and
continuous innovation on the product
helping Apple to be ahead of the
competition. The perfect symbol for
iPods simplicity would be its click
wheel (see the figure on the right).

The genius behind iPods success, Steve Jobs

summarizes this concept with the words most
people make the mistake of thinking design is
what it looks like. People think its this veneer
that the designers are handed this box and told,
Make it look good! Thats not what we think
design is. Its not just what it looks like and
feels like. Design is how it works.
Jobs often complained about the competitors
trying blindly to clone the products features
without even understanding them. By these
complaints, he meant the simplicity of the
product. iPod operates thru its revolutionary
click wheel and provides the user with means of
quick, effective and idiot-proof control of the
product.
Using this simple and effective control design, Apple continuously added new
features to the product and extended the family. The figure below shows the
timeline of iPod models along with other Apple media / telecommunication
products. By improving or adding features like storage capability, smaller design,
ability to play videos, Apple continued to dominate the market while keeping the

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simplicity of control.

Another important part of iPods simplicity is the iTunes software. While providing
users with the ability to manage their media catalogue, it also allowed them to
buy the songs they wanted for as low as 0.99 USD and to actually own those
songs for their lifetime. This feature was revolutionary in an era in which people
were in the potential chaos of facing lawsuits caused by illegal peer 2 peer music
downloading and of music industrys futile and totally wrong effort in building
subscription-based digital selling where a user would lose all rights on the song
he paid, upon termination of the subscription. Apple valiantly saved the users
from such chaos and gave them the perfect and simple means thru iTunes.

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EMRE KIRATLIEMBA 5202 BRAND MANAGEMENT HW 2

III.

14.04.2011

iTUNES; SHOULD IT CONTINUE TO BE A CLOSED SYSTEM?

The second question is whether Apple should continue to operate a closed

system or open it to any type of digital music player? There are multiple factors
influencing the answer to that question.
iTunes current motto is If it makes you want
to sing, dance, listen, watch, or play, its most
definitely on iTunes4. In other words, one can
find almost anything in iTunes huge selection
of Music, TV Shows, Movies, Podcasts,
Audiobooks and iTunes U (U stands for
university). People can rent or buy movies in
HD format for as low as 0.99 USD, or get the
whole semesters video lecture set of Oxford
Universitys Professor J.J. Binneys Introduction
to Quantum Mechanics for free. Furthermore,
the platform offers millions of applications for
new versions of iPod and other Apple media
devices such as iPhone or iPad. In short, iTunes offers the widest range of digital
media content with perfectly affordable prices.
The second factor is the seamless integration of the iTunes content with all Apple
devices (namely, iPod, iPhone, iPad and Apple TV). Whether being a song, an
episode of a TV show, or a game, Apple devices are 100% compatible and
capable of playing or executing those content.
The third factor is the competition being very weak. There are no competing
platforms offering such wide range of digital media and being able to integrate
that content to portable devices. In other words, iTunes is practically the sole
entity in its area.
Finally, considering iTunes being an open platform, it would surely face device
compatibility problems and risk of losing a well established and loyal community.
Therefore, offering the widest range of digital media with seamless integration
with its devices and without any serious competition, Apple should continue to
operate a closed system.

4 Apple Website (2011). http://www.apple.com/itunes/whats-on/

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IV.

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APPLES MARKETING PLAN FOR iPOD

The third question in Kellers Case Study is whether Apple has done a good job of
marketing the iPod or not. In order to be able to answer this question, let us have
a closer look at the marketing strategies. Apple used dark silhouettes with
their iPods and white earphones. They were usually dancing, and these
silhouettes were used almost everywhere in addition to TV commercials (please
see below examples).

Those silhouettes created an extremely good awareness of the product and made
it distinguishable from the competition. That product was an iPod, the others
were MP3 players.
Along with this strategy, Apple relied heavily on testimonials and co-branding
activities. It is well known that testimonials strategy almost never fails.
Therefore, Apple used celebrities (such as U2, Eminem, and Oprah Winfrey) and
brands (such as Nike, BMW and Ferrari) well known and well trusted.
In addition, Apple carefully managed information leak by the internal employee
about new products. With that strategy, people knew just enough and became
highly curious.
Finally, Apple Stores provided the customers with Touch, Feel and Purchase
experience. Apple Stores became the best place to learn and experience
everything about iPod.

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In sum, when compared with iPod Sales Chart 5, it can be safely concluded that
Apple did a great job in marketing of iPod.

V.

APPLES DISTRIBUTION NETWORK; REACHABILITY VS CUSTOMER

RETAIL EXPERIENCE

In his next question, Keller asked about the importance of the large retailers and
if Apple should be concerned with not having full control over the customer retail
experience. Apple had always been focused on creating a very good customer
experience in its stores. For this purpose, Apple discontinued selling in large
retailers such as Best Buy. Considering the fact that the relevant products at that
time were computers, selling expertise would be understandably important.
However, iPod was an idiot-proof, easy-to-use product. The risk of bad customer
retail experience was minimal. Furthermore, Apple needed to be in large retailers
in order to penetrate the market. In other words, the product had to be
conveniently reachable in the market. Apple had only 110 stores, but the
retailers had more than 20.000. The importance of these retails points was far
greater than the risk of bad customer retail experience. Therefore, Apple took
the logical step of extending its distribution network to include those large
retailers. Again, based on the above iPod Sales Chart, it can be concluded that
Apple took the right decision. Additionally, Keller mentioned in the case that due
to iPod usage, PC users tended to buy an iMac within the year of their iPod
5 Wikipedia (2011). http://en.wikipedia.org/wiki/IPod
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purchase6. In other words, extension to large retailers had a positive effect on

Apple Stores sales.

6 Keller, K. L. (2008). Best Practice Cases In Branding. New Jersey: Pearson

Education Inc.
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EMRE KIRATLIEMBA 5202 BRAND MANAGEMENT HW 2

VI.

14.04.2011

THE FUTURE OF THE iPOD

The final question of Keller was, what should Apple do next to sustain iPod sales?
The answer to this question is not very difficult; continue to add or extend
features in the product line while keeping the simplicity. For example, iPod Touch
added the ability to play all kinds of media along with executing applications and
started to use an even simpler control interface than the click wheel; a touch
screen. Furthermore, Apple extended its product line not only vertically but also
linearly. The company is offering the customers iPhone, iPad and Apple TV
products.

Perhaps in the near future iPod devices will have the ability to play 3D media
followed by holographic projection capabilities. Especially in case of the
holographic projection, it would be possible for an iPod Nano sized device (Apple
may name this product as iHolo) to create a room-sized, next generation HD
holographic content, eliminating the need of the screens in the product.
Additionally, Apple should continue to improve iTunes platform. It would be wise
to integrate Cloud Computing services to the platforms portfolio so that it would
continue to be ahead of the competition.

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