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Product Management and SWOT Analysis
In her 1998 article titled, Consumers and Their Brands: Developing Relationship Theory in Consumer Research, Susan Fournier demonstrates that consumers commit themselves to a particular brand because a purposive, consumer-brand relationship exists between them and the brand. This consumer-brand relationship, the author posits, is maintained as long as the brand's characteristics align with the customer's living experiences. Towards this end, the author expresses that there exists a strong, direct relationship between emotions and brand loyalty. Positive emotions lead consumers to maintain their purchase behavior and even recommend their preferred brand to others; whereas negative emotions produce the opposite effect. This text uses Fournier's (1998) perspective to evaluate the effectiveness of the product management, positioning, and branding strategies of Apple and Philips.
Branding and Positioning Strategies
The Apple brand has evolved, expanding its range of products over the years, to compete in some of today's most competitive markets. It began with desktop computers in the 1970s, before bringing in laptops in the 90s; and the iPod, iPhone, and iPad in 2001, 2006, and 2010 respectively. The brand was more of a challenger in the early decades, focusing more on the branding strategy of developing products using digital hub technology and conforming to the technological mandates of the industry; and less on providing the customer with easy-to-use computers that met their style, individuality, and needs. There, however, has been a gradual paradigm shift -- digital hub technology is no longer as important, and has been replaced with client experience. Presently, Apple provides an integrated, harmonized, and synchronized customer experience across all main devices, blending its digital content (App Store, iBooks, and iTunes) with iCloud so that customers are able to access functionality and services on any Apple device (Apple Inc., 2014). In this case, the branding strategy is based on fulfilling the client's desire for instant satisfaction -- a desire to get what they want and have their needs and expectations met.
It is a widely-accepted view that the Apple brand earns and demands a price premium (premium brand image). Apple Inc. aligns its position as to target the less price-sensitive customer. It structures its activities to meet this target's group's needs (needs-positioning), and creates a culture and activities geared at facilitating the same. If Apple were to compete for all customer segments, it would have to lower the price of its brand, a move that would undermine both the activities/culture and the premium brand image.
Philips' vision is to "deliver superior value for customers" through innovation (Philips, 2014). This vision makes it necessary for the company to understand critically what people's needs are. Philips' brand positioning is focused on providing customers with a more straightforward and more comfortable relationship with technology. The company reckons that the technology being produced is only making things more complex for the ordinary customer; and is not in any way making life better, simpler, and easier as per the promise of the Technology Revolution. The Philips brand is positioned as to offer a solution to this by developing technology that people can use without having the hassle of reading through complicated manuals. Towards this end, Philips is continually adding new easy-to-use products in its portfolio.
The brand is positioned on the basis of three fundamental pillars (also referred to as the pillars of sense and simplicity) -- that the product is i) advanced; ii) easy to experience; and iii) designed according to customer needs (Business Case Studies, 2014). The chart presented in fig 1 illustrates the sense-and-simplicity framework for the Sonicare electric toothbrush, one of the more recent inventions by Philips.
Fig 1: Sense and Simplicity - The Sonicare Electric Toothbrush
Makes use of powerful sound waves, and consequently, brings about safer and better cleaning
Goes off automatically after 2 minutes, the amount of time considered appropriate for effective breathing
Designed around the customer
Eliminates the need to visit the dental hygienist -- the electric toothbrush, serving as the hygienist, is brought right into the home
(Business Case Studies, 2014, p. 3)
The Philips branding strategy is based on emotions, particularly the feeling of trust, where customers believe that Philips products are reliable and can improve their lives based on the brand's claims.
The Apple branding strategy is focused on client emotions. It is based on the feeling a customer experiences when using an Apple device. The personality is about empowering the customer through technology; meeting their hopes, aspirations, and dreams through innovation; granting them the liberty to access functionality from any device; and getting their actual lifestyle to meet their imagination. All these would only be possible if the product designs are simple enough to make life easier for users. One can, towards this end, rightly argue that the Apple brand personality focuses on bringing about simplicity in technology, and consequently, developing a sincere connection between the company and its customers to ensure that their needs are met.
Philips has severally been accused of lacking a distinct sense of direction. It has, over the years, dedicated some significant attention to customer satisfaction, but has not really had clear goals that it seeks to achieve in this area. Only recently, however, the company rebranded, developing a personality that focuses on a particular aspect of customer satisfaction - easy-to-use technology that saves the user the hassle having to go through complex user manuals. It is based on the identified need that customers are fed up with the complexities of technology, and that they prefer easy-to-use solutions that are able to meet consumer needs in an effective way. The personality is perfect for the Philips brand, thanks to its wide product range. So far, only Apple has implemented a similar approach, but its success is largely inhibited by the limited range of products. The Philips brand personality, therefore, focuses on the brand, as much as it does on the specific needs of customers.
Similarities and Differences between the Two Branding Efforts
Philips' and Apple's branding strategies are identical in number of ways. To begin with, they both focus on client experience and client emotions. Apple focuses on keeping its clients satisfied by inventing apps that increase the suitability of Apple devices to both commercial and lifestyle use; and improving the degree of synchronization among devices and functionalities. Philips, on the other hand, commits itself to meeting customer needs through easy-to-use technology that eliminates the hassle of having to go through complex manuals as is the case with most modern inventions. A second fundamental similarity is that both branding strategies pay significant attention to simplicity in technology. Philips makes use of the 'sense and simplicity' slogan to demonstrate the same. Apple's personality -- which is about empowering customers; meeting their hopes, aspirations, and dreams through innovation; granting them the liberty to access functionalities whenever, wherever; and linking their imaginations to actual experiences -- is almost impossible without simplicity in technology.
The principal difference between the two strategies, on the other hand, is that whereas Philips bases its strategy on a wide range of products and focuses on different customer segments; Apple's targets affluent customers, who are less price-sensitive and more inclined towards quality.
Lessons to be Learnt from Philips and Apple Branding Strategies
There are two fundamental lessons that a would-be brand manager would want to learn from the branding approaches of Apple and Philips. The first lesson is the culture of making something beautiful and extraordinary out of ordinary stuff. Apple, for instance, is known for transforming ordinary things into extraordinary inventions as was the case when it pioneered the features of computer systems and standard operating systems to bring forth the gorgeous iPhone 4, Macbook Air, and the iMac, and thereby save PC fans the need to build or buy external tower systems…[continue]
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