Femi Emmanuel
Prof. Pollack
Memorandum
4/18/14

Service as The Core Marketing Offering

Apples hardware is looked upon as the beautifully designed tangible object. But it is the software that turns that beautifully designed tangible object into an amazing product for personal use. Apple is a hardware company that is true. They are also a software company. However, they don’t want to just sell you hardware or software. They focus on selling you an experience. That experience is driven by their ecosystem.
There was a number of things hardware wise to be excited about. The new Mac Pro and all its innovations are best in class. The new iPad Air is the thinnest and lightest full size tablet on the market, or the iPad Mini now with Retina display with an A7 processor. With that being said, as important as the hardware is the software is the compelling part of the product and Apple’s vision for advancing personal computing. Apple has begun to use software as a service for personal computing. Apple has put pressure on Microsoft by bringing iWork to consumers for free. For most mainstream consumers iWork is more than sufficient. iLife has always come pre-installed on Macs but is now free as well and nothing like the iLife exists in the Windows ecosystem at any price point. However, Apple has raised the bar by making OS X free. That one will be tough to compete with. What is amazing is that a company who is strengthening the power of their ecosystem through software is able to do so by offering this software experience for free. Apple’s hardware may cost more but you are also getting more from a software standpoint. Consistency in OS updates, app updates, and more is now free. Not to mention best in class customer support. This cannot be overlooked or underestimated, because this is their primary advantage. Consumers now know that an investment in Apple’s hardware is an investment in future software upgrades at no additional cost. The value of the software is now built into the value of the hardware. Apple is telling customers that they are committed to bringing them quality software as a service to their quality hardware.

In some cases Apple was first in providing a service, iTunes for example, and in others they were later, such as Maps. In either case, whether they are first to offer a service or add services later that were initially offered by third parties, it is important to grasp a fundamental concept.

Apple’s core services challenge is shown when other services do it better. In the case of Maps, Google did it better. Google had more mapping data and expertise since they had been doing it longer. Clearly, the challenge for Apple was, first and foremost, to build a mapping experience that was at least on par with Google Maps. Some may argue they are close while others may argue they are nowhere close. Apple needs to address the question of why they should use their mapping solution over Google’s, especially given that people have been using Google maps for many years and are comfortable with it. The answer is convenience. Apple can more tightly integrate their mapping solution into the core iOS experience, which makes using Apple maps more convenient for the user than a competing service, and Apple has done just that with Maps.

Several consumers have