Time for growing the apple core

We're big fans of growing the core. And we think that more and more companies will be trying to figure out how to do this over the coming months, given the tough economic times we face.

An interesting article on Yahoo! by Arik Hesseldahl
suggests that Apple is one such company who could benefit from this approach. He says: "With the economy heading into certain trouble, consumers are more concerned about lowering the balances on their
credit cards than on maxing them out on new stuff."

Rather than seeking to create another world-changing product breakthrough a la iPod, iTunes or iPhone, Arik suggests that "Apple and its customers would
be well-served if the company concentrates on making everything better,
faster, and cheaper."

Ideas on how Apple could do this include:

1.Build penetration: Apple still only has 8.5% of the U.S. PC market. Growing this to 10% would boost sales by 18%. Arik proposes doing this by adding new and improved features
and functionality to both hardware and software, increasing appeal to new
customers and keeping existing users happier longer.

2. Geographic expansion: Arik recommends using the iPhone as a
"beachhead" to introduce its brand into new markets where Apple is not strong, such as China and Russia. This is a smart idea, as the experience in Europe and the US shows that the iPhone is that rare beast: a product extension that genuinely has a positive "halo" effect on sales of other products in the range. 

3. More usage from existing products: An example of this is the recent upgrade to iTunes. The "Genius" feature: when you click on a single song it automatically creates a playlist of similar music in your collection, and suggests other songs to buy from the iTunes store.
Picture 2

This is all still innovation. But its innovation with a little "i", not a big "I". Its less sexy, but a great way to create profitable growth, especially in the current hard times ahead.