One of the core tenets of marketing is product differentiation. Apple differentiates the Mac from PCs running Microsoft’s Windows in many ways, as evidenced for years in the famous Get a Mac television and internet commercials. Macs are described as easier to use, not troubled by viruses, and so on. Evidence that Apple’s differentiation works very well comes in two areas. First, Mac sales are at record levels, even in a down economy. Second, Microsoft can only differentiate Windows on cheap PCs.
That Was Then
For many years the Mac’s reputation included easy to use along with more expensive. The iPod and Apple’s switch to Intel chips changed that.
Hardware comparisons between comparably equipped Macs and PCs often show similar prices. PCs running Windows have become synonymous with cheap, breakable, insecure, troublesome, virus-prone, and headaches.
Macs running OS X are considered elegant, trouble-free, headache free, and secure.
The Halo Effect
Leading up to the Mac running Intel Inside was the runaway success of Apple’s iPod. Far more Windows PC users bought iPods than Mac users (though a percentage of each would probably show a higher use among Mac owners).
Windows using iPod owners loved Apple’s portable media player so much that they were enticed by the Mac, which could now run Windows, didn’t need virus protection, and had a stellar reputation for quality, ease-of-use, and dependability.
Windows-based PCs had the opposite of whatever a halo represents. Hoards of disgruntled and unhappy customers willing to try the computer from the same company that gave them their darling iPods.
Apple has successfully positioned the Mac as the personal computer that loves you. Stable, dependable, affordable, fast, and with plenty of Mac applications and utilities already installed.
Meanwhile, Windows PCs, despite Windows Vista’s improvements, are perceived as cheap, shoddy, insecure, undependable, commodity devices devoid of personality.
Besides, the Mac can always run Windows and Windows applications if needed. In just a few years, Apple’s Mac has increased overall market share by nearly double, and now owns a commanding market share in the above $1,000 segment.
Microsoft is on the defensive with only a single point of differentiation left. Lying and price.
In a series of television and internet commercials called Laptop Hunters, Microsoft fights back on the only ground it can defend. Cheap.
The Laptop Hunter ads are full of lies and distortions, typical of Microsoft’s business practices. Will a cheap price resonate as a key point of differentiation with computer buyers? Will Microsoft succeed in slowing erosion in market share and mind share.
Yes, and no. Cheap is a key point of differentiation between Macs and PCs. Except that Microsoft’s Laptop Hunter campaign is reinforcing cheap rather than emphasizing value or performance, areas where Windows cannot compete.
Such an exercise only serves to create two classes of PC users; those who buy cheap products running Windows, and those who buy quality and value represented by the Mac.
The Windows maker, via Laptop Hunter ads, pushes price, doesn’t mention PC brands, except the Mac, and never mentions Windows. This is a strategy to stem the market share bloodletting?
This is a flawed strategy that has yet to catch on, and where it does, the low end of the PC market, only benefits Apple’s Mac at the expense of PC manufacturers forced to set prices lower and lower to compete.
Is there another option for Microsoft?
They could start by building a better operating system, bundling an improved suite of applications with all PCs that work seamlessly and effortlessly to handle movies, music, photos, web page building, audio production, calendaring, email, browsing, contacts, and make it work seamlessly with the most popular handheld, portable devices.
You know, like Apple. Maybe then a lower price might be attractive.