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Apple's $1,800 MacBook Air.

Apple's iMac starts at $1,200.
The Apple monster keeps sating its appetite for growth on the pc retail market

Somewhere, Apple CEO Steve Jobs must be smiling.  The iconic and controversial electronics figure, rarely skips a beat in his tireless promotion of the Mac computer.  Q1 2008 also brought some very impressive numbers for Apple.

This time it wasn't Jobs who was hailing the Mac's market turnaround, but NPD, fresh off their latest number crunching.  In Q1 2008, Macs overall took 14 percent of the market for personal computers, and took a whopping 66 percent of the lucrative $1,000+ personal computer market.  On the desktop side of things, Apple owned a 14 percent overall retail share, and 70 percent share of the $1,000+ sales.  For notebooks, the sales were 14 percent and 64 percent respectively.

Stephen Baker, NPD's vice president of industry analysis pats Apple on the back for its impressive numbers and gives a stick to Windows PC makers.  He states, "In notebooks [Apple is] growing two times the market; Windows notebooks are pretty much flat right now."

Apple notebooks, according to Baker, are up 50 to 60 percent from Q1 of last year, while Windows notebooks show virtually zero percent growth.  On the desktop side of things, Baker states, "They're up 45 percent.  The [overall] market is down 20 percent. Windows desktops would be down 25 percent."

Baker comment glibly, "iMacs are growing and the Windows desktop ain't. No matter how you look at it, Apple is outperforming Windows."

Some would be quick to point the finger at Microsoft and Windows Vista.  Vista has earned substantial criticism, though some supporters ardently defend it.  However, love it or hate it, Baker doesn't think Vista is a big factor.  He states, "I don't believe that Vista's to blame.  The vast majority of consumers don't care [about the installed operating system]."

What is the key to the Mac's success, particularly in the high-end market?  Baker says part of it is due to the fact that, besides the Mac Mini, all Mac's are priced at over $1,000.  Baker states, "If you don't give people a choice, people will spend more."

He sees the growth of Mac sales as a sign of consumers making emotional decisions.  He argues that the average consumer doesn't care so much about features, but cares more about how they feel the overall experience of the computer will be.  He states, "Consumers don't care about features.  People see a value proposition in an offering that gives them a great experience."

Baker also says that Apple is cashing in via improved retail store presence, including benefits from increased business at its own stores.  He says, "Apple has got better distribution than it's had in the last 15 years.  They're in the right spot right now. There's the iPod advantage. But the big thing is the stores."

Apple stores, he says make the customer feel like they are the recipient of individual attention.  Says Baker, "What Apple drives home: This is a product that we own from factory to finger.  We exert some control so that you get the best experience. When you get in the store, we get you what you want."

The next logical question, Baker says is, "[Apple has] already won when somebody comes into the Apple Store.  How does it play in places where they're not the only answer? How big a handicap is Windows?"

Therein lays the key to Apple's success in Baker's mind -- "captive channels".  He advocates that if Microsoft hopes to remain successful it should follow in suit, opening at least a small chain of Microsoft stores.  He states, offering an analogy to the fashion industry, "In a multi-channel environment you should have some kind of owned--and operated--channel as well.  When you look at Coach they have their own showcase stores as well."

Apple's strong sales will likely be fodder for more debate among detractors and fans.  However, Baker provides an interesting third-party perspective from the firm watching all the numbers.  While his suggestion of a Microsoft store certainly seems outlandish, stranger things have happened.





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