The iPhone continues to be the hottest phone around. With 17% of the consumer market, classic brand strategy suggests iPhone should be a powerful co-brand partner. Its appeal among early adopters, Millennials and now business people, and its cool lineage, make iPhone aspirational for brands that want or need to recruit these attractive audiences.
Big brands like AT&T and Walmart, as well as small ones, have vied for the opportunity to link to the juggernaut in hopes of having it rub off on them, making them cooler by association. But it just hasn’t happened. AT&T and Walmart have made boatloads of money in the US market from their exclusive iPhone deals. But that’s not the same as transferring brand equity from iPhone to either of these business behemoths.
In an April 15 article, Amol Sharma in the WSJ claimed that “The blockbuster device (iPhone) has reeled in millions of new customers and helped revitalize the telecom giant's brand.”
We would challenge the second half of that contention.
The data suggests that the AT&T brand is still not cool. As this rant on Yelp by Elite Squad Member, Aaron, in August 2008 shows, AT&T has a long way to go:
“…First off, who thought that the brand AT&T had positive associations with the American public? I think the branding AT&T was about as popular as the Taliban or the forgotten TV show COP Rock. The fact that someone actually thought AT&T was a more attractive branding then Cingular tells you everything that you need to know about this company. This review will consist of two parts.....a general overview of AT&T wireless and specific information about this specific outhouse of an AT&T store…”
In fact, AT&T has so far to go that last month the company launched a TV campaign promoting the fact that the founder of TOMs Shoes – a favorite Millennial do-good consumer brand – lives by his iPhone and swears by his AT&T global wireless phone service to orchestrate his shoe-giveaway trips to impoverished kids in South America. This campaign, featured on American Idol last month, arguably is doing more for the AT&T campaign than its iPhone deal!
iPhone is not having the desired halo. All this demand may have gone to the heads of the folks at iPhone. Apple is running an entire campaign based on having Apps for just about anything anyone would want to use an iPhone to do. And according to an April 30 story on Techcrunch, “Apple owes a lot to iPhone app developers-the App store just reached 1 billion app downloads thanks to … savvy developers who have created useful and creative apps.”
However, at the same time, Apple business practices are alienating the iPhone developer base. The same Techcrunch article reported disgruntled “partner” complaints about iPhone being a slow-payer and threats to sue Apple for breach of contract.
This is a glaring and rare example of Apple taking advantage of – rather than supporting - the little guy. While it is hugely uncool, even this doesn’t seem to stick to the iPhone brand. Perhaps iPhone really is made of Teflon?
6 comments:
Interesting to see today's story in Ad Age about whether Apple should be the arbiter of taste for iPhone Apps. As with AT&T, the article reaffirms the "ultra hip" iPhone's lack of halo effect for "unhip Walmart".
http://adage.com/article?article_id=136545
The issue raised seems likely to damage the Apple brand with opponents of whatever side the company chooses. Our prediction: once again, the iPhone will stand alone.
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