Why are iMacs and eMacs not selling better?
This is not intended to be a PC vs. Mac thread, although I can see how it could stray in that direction. The iMac 2 was supposed to be a sort of deliverer of the Mac platform. It was a paradigm shift. It was to reshape the face of desktop computing as we knew it. In short, it was "the next big thing." My question is simply this. What went wrong?
I know, I know, the initial excitement was huge. The press is still big on it to this day. But not long after release, the orders stopped rolling in. After a protracted inventory shortage, there was an even more protracted inventory overflow that, to my knowledge, persists to this day. I believe that the inventory problem is why the mid range update was so small and the low end model was cut out all together. It is the only thing that explains the total lack of updates for over a year. People were not buying that which was already out there. Why?
Is Apple's market too incestuous for its own good? Is Apple going to its customer base too often with unreasonable expectations of complete system purchases? Are Mac users so happy with their current systems that they're just not ready for a new one?
Did Apple, (here's where it could break down into a Mac vs. PC debate), did apple simply overestimate the switch potential of the machine? That's what I think the problem was. They thought it would be the switch box to end all switch boxes. They were expecting a market share moving switch box and they didn't get it. They over estimated the AIO market. They thought the AIO failed to be more than a niche player on the PC side because no one had ever built a good one. Their arrogance led them to believe that all they had to do was to build a better mousetrap, which they did. They were wrong.
They also misinterpreted their own success in that arena. They thought they had their finger on the pulse of the AIO market when all they really had was their foot on the neck of the Mac market. The Mac AIO is not successful because it is so much better than the PC AIO, (which it is). It is successful because it is the only alternative to the overpriced PM line. There is no consumer tower in the Mac universe. If there were, Apple would quickly learn a valuable lesson already known by those on the PC side The AIO market is nothing more than a niche market, a small niche. Always has been, always will be.
Finally, let's not forget the price debacle shortly after introduction... nuf said.
Then there's the eMac. It was specifically designed with the school's desires in mind. Why on earth is the Mac education market plummeting. No, I do not believe that Dell is the problem. They do not build special computers for schools, they build computers that schools find attractive for the price. The way Apple describes it, the eMac should have been a school system's wet dream come true. Why is it not?
Note, these are just my opinions. I reserve the right to be wrong. Please don't waist your efforts trying to prove me wrong. Rather, tell me what your opinions are. I will treat them with the same respect you treat mine.
[ 02-10-2003: Message edited by: Mac Voyer ]</p>
I know, I know, the initial excitement was huge. The press is still big on it to this day. But not long after release, the orders stopped rolling in. After a protracted inventory shortage, there was an even more protracted inventory overflow that, to my knowledge, persists to this day. I believe that the inventory problem is why the mid range update was so small and the low end model was cut out all together. It is the only thing that explains the total lack of updates for over a year. People were not buying that which was already out there. Why?
Is Apple's market too incestuous for its own good? Is Apple going to its customer base too often with unreasonable expectations of complete system purchases? Are Mac users so happy with their current systems that they're just not ready for a new one?
Did Apple, (here's where it could break down into a Mac vs. PC debate), did apple simply overestimate the switch potential of the machine? That's what I think the problem was. They thought it would be the switch box to end all switch boxes. They were expecting a market share moving switch box and they didn't get it. They over estimated the AIO market. They thought the AIO failed to be more than a niche player on the PC side because no one had ever built a good one. Their arrogance led them to believe that all they had to do was to build a better mousetrap, which they did. They were wrong.
They also misinterpreted their own success in that arena. They thought they had their finger on the pulse of the AIO market when all they really had was their foot on the neck of the Mac market. The Mac AIO is not successful because it is so much better than the PC AIO, (which it is). It is successful because it is the only alternative to the overpriced PM line. There is no consumer tower in the Mac universe. If there were, Apple would quickly learn a valuable lesson already known by those on the PC side The AIO market is nothing more than a niche market, a small niche. Always has been, always will be.
Finally, let's not forget the price debacle shortly after introduction... nuf said.
Then there's the eMac. It was specifically designed with the school's desires in mind. Why on earth is the Mac education market plummeting. No, I do not believe that Dell is the problem. They do not build special computers for schools, they build computers that schools find attractive for the price. The way Apple describes it, the eMac should have been a school system's wet dream come true. Why is it not?
Note, these are just my opinions. I reserve the right to be wrong. Please don't waist your efforts trying to prove me wrong. Rather, tell me what your opinions are. I will treat them with the same respect you treat mine.
[ 02-10-2003: Message edited by: Mac Voyer ]</p>
Comments
As for Apple failing to take either the educational market or the consumer market, I contend that if Apple released a $999, IBM 970 driven PowerMac tomorrow, there might be a large number of sales into the existing market, but Apple's overall market share might tick up another tenth of a percent (by one metric, at least). This is because Windows currently enjoys a tremendous network effect. Right now, no matter what they offer, Apple can only lure people who are so frustrated with Windows that they are willing to jump from the known platform that they and all their friends and employers have to this dark horse. It hasn't been two years since the last time someone asked me "Didn't Apple go out of business?"
An example: Several years ago I was talking to a developer who used Borland's Delphi (a rather nice implementation of Object Pascal) to write Windows applications. He was using Visual Basic 1.0. I asked what he thought of it. Oh, it was buggy, and the IDE was a lot worse than Borland's, and it couldn't do this and it couldn't do that. So, I asked, why did he switch? Because it's Microsoft, so everyone will be using it in a few years. He wanted to get a head start. Just like that, for no technical reason, Delphi lost, and in the grand tradition of the self-fulfilling prophecy, VB won. This is one of the things that got Apple kicked out of enterprise. Sure enough, since schools started bringing in enterprise IT people, Apple's been getting kicked out of schools. It has nothing to do with either Dell or Apple, and price is a mere alibi. IT people buy PCs running Windows. All of their training, and all of their knowledge, is geared toward PCs running Windows, to the extent that alternative platforms are considered a threat. It's not the IT people's fault, either. They're being brought in by school boards who think the school should run what everyone else runs: Windows.
Given this, Apple is doing what they can do: Make their products as compelling as possible, make them as available as possible, make them as compatible as possible, and accept the fact that all their efforts will not pay off for a long time, because they're up against a huge, entrenched feedback loop. Ubiquity reinforces itself. But diligence and patience will be rewarded. All they need to do is start garnering enough sales that enough people - especially IT people - talk about that new iMac thing they bought that's really nice, and it does email and Word and the Web, and they'll get some momentum of their own. But no single initiative will accomplish this. No single product will accomplish this. Apple will have to fire on all cylinders and spin their wheels for a while before they gain traction.
I'd say that the two most significant things they've done toward this end are the Apple stores, which get the brand and the products out where people can see them, and the cross-platform iPod, which has yet to elicit other than a glowing review from anyone.
[ 02-10-2003: Message edited by: Amorph ]</p>
I'd say that the two most significant things they've done toward this end are the Apple stores, which get the brand and the products out where people can see them, and the cross-platform iPod, which has yet to elicit other than a glowing review from anyone.
<hr></blockquote>
And 'patience' and 'diligence'.
Given the vast array of stuff Apple is doing. They're doing almost everything they can. And should be commended for fighting almost impossible odds.
I still think their consumer desktops have room to move. Too rigid and 10% too pricey. But neither that nor the 970 on their own can bring about 10%. Their desktops aren't what their laptops are. But I've got a sneaky feeling that spectacular 'fall' announcements may shut me up on that one.
In particular to the iMac2 and eMac. Too long, too little between updates. That says it all, I'm afraid. If the iMac 2 was as aggressively priced as the original iMac was with more options under a thousand smackers than it may fly off the shelves faster. It simply isn't priced to go. I'd buy if it was more tempting. Again. If the eMac was in bargain basement territory, say...another two hundred cheaper...buying one wouldn't be an issue. I still can't see how the ibook entry model is £795 and the cheapest Apple iMac2 is £999 inc VAT. I'm perplexed by this. I think something's not quite right there...manufacturing or otherwise. Yeeesh. 15 inch LCD's now cost £150 inc VAT in average Joe catalogues. And there's nothing spectacular about what the base iMac is offering. Should be £850 inc VAt tops. I may bite at that.
In summary, I agree with the thrust of Amorph's post.
There's no magic wand but hard work.
Lemon Bon Bon <img src="graemlins/hmmm.gif" border="0" alt="[Hmmm]" />
[ 02-10-2003: Message edited by: Lemon Bon Bon ]</p>
But seriously, I think it's a combination of two things: Apple's lack of aggressive, frequent and clever marketing and the fact that maybe the iMac, right or wrong, is seen by many as "that toy computer".
The two are somewhat linked because Apple has done very little to convince otherwise. Think about it: what was the big (and ONLY) commercial Apple had for the LCD iMac? That one where the guy and the iMac were copying each other's movements and facial expressions in a storefront window.
Yes, doesn't get more "hey, this is a serious computer that can do some serious, cool things" than that, huh?
<img src="graemlins/hmmm.gif" border="0" alt="[Hmmm]" />
Never ran an ad demonstrating the "digital hub" nature of this machine. Never ran a commercial simply showcasing its beautiful, intelligent design. Never ran a commercial comparing it and its features with Windows-based AIO machines.
All we got was an iMac sticking its tongue out.
Obviously, no the hell it doesn't.
<img src="graemlins/hmmm.gif" border="0" alt="[Hmmm]" />
I honestly thought they'd fly off the shelves and that it would surpass the original jellybean iMac in popularity and pop-culture attention/status.
People STILL talk about the colored gumdrops.
The iMac FP was also limited by a 100 Mhz bus, a 5400 RPM HD and no L3 cache. Look at the December issue of Macworld and you will see how this machine compares to the ugly Gateway. The Gateway crushes the iMac at Photoshop (heck that machine crushes the DP 1.25)
The computer year is every 6 months. You have to upgrade at least every 6 months. For Apple to let rot (pun intended) the iMac for the last 6 months killed the 15 inch. The 17 still sold well for what it was.
This is a shame because the new iMac is really nice. But is should have been released in July and we should have 1.25 or higher now. But it still is not bad.
The thing about Apple that kills me is that if it had more competative machines, it sales would be through the roof! There are people out there that want to buy macs, they just have to be made competative (in speed than price).
<strong>...
[ 02-10-2003: Message edited by: Amorph ]</strong><hr></blockquote>
wow, excellent post, amorph. ever think of applying for a job at one of the mac magazines?
<strong>
wow, excellent post, amorph. ever think of applying for a job at one of the mac magazines?
Hear Hear! It's not often you find eloquent Programmers(I give that dig with the upmost respect).
I also think that an overlooked areas is simply the economy. Had the LCD iMac came out a year earlier it would have been different. Before the dotcom bust money was flowing..jobs were plentiful. Spending a premium on a cool stuff was no big deal. Think Apple is noticing diminished sales. Look at even the "basics" in Seattle they're giving away months of rent with a long term lease like you wouldn't believe. Value is the proposition many of us are looking for and it can make the difference between shelling out for that iMac or waiting until the next generation. Apple needs to realize this and realize that those who are "waiting" will not purchase any sooner if you're updating products only one a year.
Yesterday, I was with a buddy, who two years I ago I helped to purchase a HP desktop (this was pre my mac conversion). I was showing him the new ilife apps on my pb800 and he was floored by what I could do with free software!
He purchased a new imac 17" right then and there online. IT wasn't because it looked cool (really who cares, it sits in the back of his office) it was because it works so well, and does so much!
<strong>I am in total agreement with Amorph. Apple has to just keep plugging away at the market, keep innovating and eventually someone will take notice. It is just a matter of time before Apple starts to sway people with their continuously innovative products.</strong><hr></blockquote>
What have thye been doing since 1984?
<strong>
Hear Hear! It's not often you find eloquent Programmers(I give that dig with the upmost respect). </strong><hr></blockquote>
Thanks.
[quote]<strong>I also think that an overlooked areas is simply the economy.</strong><hr></blockquote>
I don't think it's overlooked at Apple, though. In fact, my post was inspired by something Fred Anderson said in the last call, about offering the best products they could (i.e., not releasing conservatively because of the economy) so that when it did start to recover they'd have the best lineup possible. I just took that strategy and applied it to their overall momentum in the market: They'll push really hard and go nowhere for a while, but when things do start to move they'll be ready.
I still don't know why the iMac wasn't updated for a year, except perhaps that with the 7457 delayed for three whole quarters (and that's not counting the fact that Mot is more than a year late moving to .13 microns!) there was simply nowhere for it to go. I expected a bigger revision, but my expectation hinged on the 7457. Now that's not coming out until late fall, so...
I really hope this year changes things, in terms of decent CPU scaling, frequent revisions and prompt process improvements. Apple can fire on all pistons, but they can only get so far on low-grade gasoline (to extend my metaphor far past the breaking point
EmAn: Speaking as someone who watched Apple in increasing despair through most of the 1990s, I can assure you that their recent behavior is unusually focused, efficient, and (mostly) cool. This Apple has their ears to the ground in a way that I've never seen from them. In 1996 I was so worried that I bought an expandable machine (the redoubtable PowerMac 8600) on the theory that the Mac market was big enough to keep a lively aftermarket going for a while after Apple's demise.
[ 02-10-2003: Message edited by: Amorph ]</p>
The iMac appeals to only a small segment of computer buyers. Its an odd duck to many people and like the eMac its overpriced and the specs stink(except the graphics card which is decent).
Basically All In Ones don't appeal to most people-towers do. Unfortunately Apple overcharges more for the towers than any other product they make. They are virtually ensuring a teensy tiny slice of the computer market for Apple. Jobs may be a smart guy but when it comes to business he's a failure........................................... .......
[ 02-10-2003: Message edited by: jayny ]</p>
Apr. 02 report (Q2 2002) - 372k units of iMac
Jul. 02 report (Q3 2002) - 378k units of iMac/eMac
Oct. 02 report (Q4 2002) - 318k units of iMac/eMac
Jan. 03 report (Q1 2003) - 298k units of iMac/eMac
Note the drop from Jul-Oct 2002... then another (though smaller) drop in the last quarter. I'd expect the unit sales to be back a bit healthier this coming quarter since they've finally been updated, maybe somewhere between 330k-340k.
In the long run I'm optimistic that OSX will be Apple's greatest asset. And the whole Apple line will be seen as a more appealing, friendly alternative to XP.
[ 02-10-2003: Message edited by: reynard ]</p>
There software is very focused, and much more relevent, however they do themselves no favours by not fully testing the software prior to release.
I fear for Apples market share even though they have a better product than at any time before, I just don't see that they can turn things around no matter how much I would like them to.
Personally, I love all in ones. I hate having a huge box on the floor compeating with my legs and blasting away with an industrial fan inside. If I could buy an iMac with one of those new 20" screens I would. The thing I can't understand is why Apple don't release a really high end iMac. Not just with a 20" screen but with say the 1.42 ghz processor and a GeForce TI and 180GB HD. I just love that neat small form factor where everything I need it just to hand and best of all that swinging adjustable screen. The cinema screens look great, but the screens on the iMac are so much more flexible, height, reach and tilt. Perfect.
Just because I want an iMac does not mean I am on a budget.
Many of the "average" computer users I know still believe that they are safer going with MS based PCs because Macs are "not compatible". Apple has to overcome this myth. With many average users just wanting to access the Internet, do eMail, and type the occasional letter, this should be a non-issue. Overcome this perception, and more people will be the cool, easy to use products which Apple creates. I know that when I show people what I can do on my Mac with the new apps, their jaws drop.
[ 02-10-2003: Message edited by: Ponton ]
[ 02-10-2003: Message edited by: Ponton ]</p>
Many of my friends just can't believe the price tag of the iMacs. And I can't blame them.
As far as the iMac, I don't know if it will ever be the machine that Apple hoped it would be. But I do believe they could build a market share machine if they wanted to. A Cube 2 or Tower Jr. or something like that would do the trick. Include the best single processors, the best graphics cards, the best sound cards (with support for 5.1 surround), the best system bus and drives. Top it off with the consumers choice of monitors and start the pricing at $999.99 including 15" LCD.
Give potential switchers something that is not so alien to them at a price that is not so alien to them in a style that only Apple could achieve and they will come. Don't make them feel like they have to compromise in order to use a Mac. If sales people have to explain the processor shortfall, that's one thing. If they have to also explain the system bus, slower hard drives, weaker graphics cards, printers and scanners that don't fully support the best OS in the world, no USB 2.0, no 2 button mouse or scroll wheel, etc., then you have a problem. Apple could do much more to make the transition smoother and more desirable. I'm not convinced they really want market share. That is to say, I think they would rather have short term gains from increased profit margins.
Ironic isn't it? I am the first person to really take this thread off topic. Thanks again for making this a good one.
[ 02-11-2003: Message edited by: Mac Voyer ]</p>