Friday, June 22, 2012

Apple Doesn't Compete With Anybody Else, Really

In some genuine sense, Apple doesn't really compete with other suppliers. It competes against itself. That is one reason Apple, as a matter of business practice, destroys markets for existing products it already successfully sells, with new and "better" products. 


To be sure, "every" company claims to be an innovator. "Every" company claims to have products that are substitutes for Apple products. There is truth to some of those claims. But no firm of Apple's size and influence actually behaves the way it does, even if other firms claim they do the same.


Apple does not build products its surveys, and other market research, indicates people want. I can't think of another large firm that really operates that way, with a possible exception of 3M. Apple dreams up what it thinks people need, and never asks people whether they "need it."


Most other firms identify markets and then create products to serve those markets. Apple creates markets. 


Sure, Apple sells smart phones, tablets and MP3 players. A research firm tracking market share has to include Apple and other competitors in such studies. In that sense, Apple has competitors. 


But Apple really is different. I buy smart phones. I prefer Android, HTC and Samsung. My children buy iPhones, not smart phones. 


But I own three iPods, zero MP3 players. I wouldn't buy any brand other than Apple, if that was the product I was buying. In that sense, Apple is different. 

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