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How does Apple avoid disruption? (And what does it mean for CEM?)

[In a few hours, Apple will report earnings for the calendar year Q1 (Q2 of their fiscal year 2015).  The numbers will not exceed the record-breaking previous holiday quarter, but analysts are predicting solid returns. There are even some signs that Wall Street’s on-going and obstinate blindness to what makes Apple tick (tock) is on the wane. But what is the secret of Apple’s success? And what does it means for the practical efforts to master customer experience management?]

How does Apple avoid disruption?

This question—or rather, the wrong answer to this question – has mislead and bedeviled stock analysts and business pundits for years. The wrong answer is that Apple can’t avoid disruption, that this time around – this quarter, this product cycle (or lack of it), this holiday season – buyers are finally going to stop over-paying for the iPhone and finally switch in droves to (they used to say) Samsung, which is, after all, functionally (and now, aesthetically) equivalent. The Apple myth, the lingering reality distortion field emanating from Steve Job’s grave, will finally be dispersed, and Apple will finally experience the pain of low-end disruption.

Tim Cook has replaced Steve Job’s reality distortion field with an inevitability denial machine.

Except, it never happens. And it continues to never happen. Tim Cook has replaced the reality distortion field with an inevitability denial machine. Not only was last quarter (Q4 of the calendar year 2014, which is Apple’s Q1 for fiscal year 2015) the greatest in Apple’s history, it was the greatest in the history of any public company, forever. Apple sold 34,000 iPhones per hour, every day of the quarter. Apple captured 93% of all the profit made on mobile devices (smartphones and feature phones) worldwide in the last quarter, and 79% of all profit for the year. Apple lost more money on currency fluctuations in Q4 than Google made in profit in Q3. (And by almost a third, $3.73 billion versus $2.83 billion.) Meanwhile, who was disrupted in Q4? Samsung . . . and by lower-cost, functionally equivalent Android smartphones.

What it means for CEM

What does Apple’s immunity to disruption have to do with customer experience management? The answer, to put it all too quickly and simply, is that Apple differentiates based on the overall, integrated experiences it offers, and that these cannot be matched by any competitor.

In my last post, I used Horace Dediu’s report on the Apple Watch “experience” to illustrate how integration (or “interoperability”) can and should be approached in terms of overall “system design.” (Overall means: considering not only the customer’s experience, but also every service, system, resource, and skill that has to go into making and sustaining that experience.)

In episode 24 of the Exponent podcastBen Thompson and James Allworth push this integration imperative further by analyzing Apple’s products in terms of jobs-to-be-done theory. It’s easy to see that the iPhone fulfills a set of functional jobs – but these can all be done just as well, if not better, by some Android phones. Equally, it’s clear that the iPhone remains a status symbol – that is, it fulfills emotional or social jobs by signaling that the user is better off and (arguably) more discerning.   Still, these factors couldn’t possibly account for Apple’s ongoing, and growing, success.

But in addition to the functional jobs (how it works) and the emotional jobs (how it makes me feel and/or be perceived to use it), Thompson and Allworth discern a third factor, which they call the experiential job-to-be-done, and which they describe as “what it is like to actually use it.”

If “it” in that formulation is a company, brand, or other provider (e.g., government institution, non-profit), then, in my view, the notion of experiential jobs may offer a very powerful new way to think about CEM, about what it means to provide “superior experiences,” and about what distinguishes a standout experience from a merely acceptable one.  For example, it implies that when designing an experience, we should think not about the effect we want it to have but rather about how it contributes to, sustains, and/or enriches the experiential job the customer wants us to do. (And that, in turn, would nurture my growing suspicion that effective CEM ought to be only “loosely coupled” to conversion and commercial outcomes.)

I’ve barely begun to develop this line of analysis (let alone master the jobs-to-be-done framework and methodology). But I am convinced that the jobs approach can advance our still-tenuous understanding of customer experiences and CEM. I’d love to hear what you think. Perhaps a regular working group?



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