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Why Apple Is So Sticky

Hugh Pickens writes "'Sticky,' in the social sciences and particularly economics, describes a situation in which a variable is resistant to change. For websites or products it usually means that visitors or customers keep coming back for more. Now Fortune Magazine reports on an analysis by Deutsche Bank's Chris Whitmore on what makes the (iTunes-based) iPhone-iPod-iPad platform so sticky and why it's going to get harder, not easier, for Apple users to switch, no matter what Google and the rest of Apple's competitors have up their sleeves. Whitmore says the investment Apple's customers have made in content for those devices in terms of apps, videos, and music purchased at the iTunes Store creates Apple's 'stickiness.' Apple has an installed base today of about 150 million iTunes-dependent devices that could grow to more than 200 million by the end of 2011. Whitmore comes up with a cumulative investment in those devices of about $15 billion today, growing to $25 billion by the end of next year. 'This averages to ~$100 of content for each installed device,' Whitmore writes, 'suggesting switching costs are relatively high (not to mention the time required to port). When Apple's best-in-class user experience is combined with these growing switching costs, the resulting customer loyalty is unparalleled.'"

2 of 595 comments (clear)

  1. Re:The question is by binarylarry · · Score: 1, Troll

    I'm sure apple nerds like to think they aren't nerds.

    But they are... they're just nerds in turtle necks.

    --
    Mod me down, my New Earth Global Warmingist friends!
  2. Re:The question is by oztiks · · Score: 1, Troll

    They don't just re-brand it. They steal it, polish it up, and releases it in a stream-lined and user-friendly product with all the bugs worked out. And as we all know, copying ideas and improving on them is Good(tm). And some of Apple's ideas are original, like multi-touch.

    I guess the single button mouse was another one of those brilliant ideas?

    On another note, Come'on we are talking about reebok vs nike here, PC/Mac, their differences these days are SFA except for the OS, and the OS is limited on the Mac because it's designed to be simple and not flexible.

    Marketing isn't everything. Having the right idea, the right people and the right corporate culture at the right time and place counts for a lot.

    Microsoft could have made Windows as user-friendly as Mac a long time ago, with all their money and their foothold on the market, but yet they fail in that department again and again.

    Interesting, though it could look as if your being a little redundant. I'd like to take your Marketing + Ideas concept a little further.

    Back in the day when Apple and MS were at it, Microsoft had the marketing message "here we are cheap, flexible and adaptable". Apple's was "I'm an artsy freak who likes to show up at fashion shows and I also like to sell these things we call computers".

    Oddly enough, the marketing message back then failed for Apple. Whats even more interesting is the fact that now in current days that exact same marketing message seems to work. Microsoft's still pretty much stays the same, your not going to be shifting them anytime soon, but Apple has tapped into this new faucet of business.

    Selling the idea that the Mimbos and Bimbos of the world can now use computers so they can send photos of themselves with their spray-on-tan via Facebook has certainly worked out for old Apple in current days. There is endless combination of simpletons that need to use a computer, and that single button clicker and that metro-sexual sales identity has been bringing them in by the hordes.

    Now, Virgin a brand that sells their products blatantly through the innuendos of sex (hetero-sexual mind you) with re-banded PC's (like Macs are really any different) Virgin could stand to do the same, I would go so far in saying it could cause an upset in Mac's market-place if done correctly.