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Apple’s Big Expectations

30 May 2012  

According to CEO Tim Cook, Apple will soon be launching some amazing new products. Yesterday at the D: All Things Digital conference Cook said, “The juices are flowing. We have some incredible things coming out.”

Cook is clearly raising expectations for the new products. You don’t use the words amazing and incredible lightly.

Is this a smart strategy?

It is certainly risky. It can be difficult to deliver against high expectations. Disappointing people is not a great approach.

In about two weeks, many of my students will graduate from Kellogg and join new employers. When they arrive they could proclaim, “I am going to be an incredible employee. Boss, you are going to be amazed. I am going to be fabulous!” This would not be a good idea.

So is Cook making a mistake?

I suspect not. If Apple has something innovative in the works, raising expectations is critical. It builds anticipation for the new product and creates excitement among employees, investors and customers.

It is also a safe move because it is hard to disappoint people with a truly innovative product for the simple reason that people don’t know how to evaluate it. If you have the very first teleportation machine you can confidently proclaim, “This is just an amazing product.” People will then likely agree; it is very difficult to evaluate the merits of a teleportation machine. If you say it is amazing, well, it must be amazing.

Indeed, when introducing an innovative product it is critical to raise expectations. Rolling out a product with modest statements isn’t a winning formula. You can’t say “Well, this teleportation device is fairly good but it has certain limitations that we are working to address” and expect the product to take off.

Raising expectations doesn’t work in well established categories, where people know what to expect and can evaluate innovations. P&G’s recent advertising campaign announcing the astonishing, amazing Tide pods, for example, is a little flat.

If Apple has another highly innovative product in the works, then Cook is smart to elevate expectations.

Of course, that is a pretty big if.

5 Responses

  1. P. Dwyer says:

    Your statement (In about two weeks, many of my students will graduate from Kellogg and join new employers.) struck me. Why do we suppose the norm for graduates from one of the worlds finest business programs is to work for employers rather than use their new skills to create enterprises of their own? What percent of graduates look for a new job vs. make one?

    • Tim Calkins says:

      I haven’t seen the latest official numbers but my sense is that the vast majority of graduating students join existing companies. I suspect there are two factors behind this. First, there is a financial issue: many students graduate with debt, so income is a positive. Most students get good jobs with impressive salaries; it is hard to turn that down. Second, many students think it is a good idea to get some experience before launching a new venture. I think both reasons are quite valid.

  2. Y. Shaban says:

    I think there may be differences in Cook (or even Jobs) truly believing a product is incredible vs a product being incredible just because he thinks it will sell well vs a product he hopes to “make incredible” by using his respected authority to brand it as incredible before people can even make their own judgements.

    I just don’t like it when somebody says something is incredible and it’s not and they know that it’s not. It’s just a pet peeve of mine I suppose.

    You’re right though that Cook is not Jobs and that if he says a product is innovative and if it’s actually not, then he risks losing his credibility.

    People have been wondering if Apple can continue to innovate probably ever since the first iPod came out. Can’t believe that was over 10yrs ago!

  3. Y. Shaban says:

    CEO Tim Cook is probably just playing it safe and doing what his predecessor Steve Jobs always did. Jobs used to describe almost every product Apple launched as “amazing,” “magical,” and other such glamorizing terms.

    Jobs could do this because Apple did create some products which were indeed perceived to be “amazing,” such as the iPod. Then came the iPhone and the MacBook Air, both of which were also very nice, innovative products. But after that, was the iPhone 2 really that much different than the original? iPhone 3 or 4? or even 4S? Not really. But Jobs was able to call each one of them “amazing” and “magical” and the public believed it.

    Of course you’re right that calling an upcoming product “amazing” builds anticipation (Apple’s notorious secrecy helps with that too) and that it creates excitement among all the stakeholders. Also, you’re right in that a typical CEO wouldn’t use such words lightly and risk having a dud of a product when it has to face such high expectations.

    But even if Apple doesn’t have an amazing product up its sleeve right now, it has to continue with the amazing mantra because it has worked so well for it in the past. Cook is just playing it safe.

    An added benefit of calling an upcoming product “amazing” is that it can help strategically. There are plenty of smartphones and other devices that are better than what Apple has to offer. But if consumers believe that something amazing is coming around the corner then they may hold off on purchasing currently available competing products. This increases the number of potential customers available for Apple’s new product and it also hurts the competition in the meantime.

    Of course, Apple may actually have a truly amazing product coming down the pipeline and it could be the oft-rumored Apple TV. It would have to be a significantly better TV for it to truly be amazing. You would think Apple would have to do more than just what Samsung has already done:

    But if they even do just that, it will sell well because, well, it’s Apple.

    • Tim Calkins says:

      I’m not sure Tim Cook can just follow Steve’s lead on this. If he proclaims that something is “amazing! incredible!” when it is fairly expected he will lose credibility. I agree with you that Steve earned our respect; if he said something was amazing, well, it probably was. I think a lot of people are wondering if Apple can keep the innovation magic going.

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