How Apple sold out at $1 trillion

After Steve’s passing, it was obvious that things will begin to change for Apple. After all, Apple was Steve’s child of labor and he was the undisputed pastor of the company. I am not trying to sugar coat anything here either, I am perfectly aware of his iron fist rule. It was an iron fist which did wonders apparently, at least for the company and the brand overall. Steve managed to get Apple from the verge of bankruptcy, on the road to the most valuable company in the world.

Innovation, design and futuristic vision were the values which were most prominent in the Jobs era. The first iPhone was nothing short of revolutionary for the cellphone industry and if not for the tech industry overall. That single product made us feel like we are a step closer to our Star Trek future than ever before. Pair this with Steve’s insistence on design and Ive’s genius, and you got yourself a perfect recipe for success. Whether it be industrial, graphic, interface or interior, everything Apple had to be highly designed. In fact, I remember a video of Jobs discussing how important fonts were for the Mac OS back in the day. I don’t believe I’ve seen a single CEO focus on design so heavily since then.

Insistence and persistence (consistency) are keywords I want to focus on in this article because it took Jobs a long time, starting from Apple’s renewal from the year 1997 up until his death in 2011 to reinvent, build and most importantly preserve Apple’s brand. Jobs understood the value of persistence in enforcing the brand’s values and if it meant using his iron fist to do it, then so be it.

On the 2nd of August 2018, Apple was valued at $1 trillion. A valuation this high is huge news in the world of economics. This is indicative how things have changed under the new leadership though. The kind of headlines Apple makes now are more in business and less and less in the world of tech. I think all that success can still be attributed to Steve’s vision, although he’s not with us anymore.

My theory is that consumers still buy the brand out of the perception of what the brand is supposed to represent, while the products themselves have gone in another direction. Apple is burning through a lot of brand goodwill which was left by Jobs.

We can confidently say that there is not much revolutionary about Apple’s products in recent years and there isn’t anything revolutionary about them now. After all, they celebrated the 10 year anniversary of the iPhone with an awkward notch and an animated 3D poo emoji. Let’s not forget the touch bar on the MacBook Pro or the more than awkward placement of the charge port on the Magic Mouse 2. Would this have ever passed under Jobs I wonder?

What Cook does for Apple today was not possible for Jobs though and what was possible for Jobs looks like an impossible task for Cook, and I believe the latter is more important for the company’s longevity.

Cook thrives on operations and execution while Jobs thrived on vision. His vision is what basically made this company into the one we know and love, but we are steadily losing that under Cook’s rule, despite the surreal market valuations. The longer Apple stirs away from real innovation, and the more it starts to look and behave like its competitors, putting out products with only incremental improvements, the less differentiated it will have on the market. To put it mildly, there is less and less magic and wonder connected to Apple’s brand.

At the moment, the company is in the Goldilocks zone. Consumers are still loyal and acting on the company’s inherited brand goodwill and Cook’s operations and business skills. That is why the company is able to achieve today’s success. Brand goodwill is not an infinite resource though. New generations won’t be able to recall Apple values which Jobs put in place. If the company continues to stir away from producing products that capture our imaginations and melts down and that would make the brand less resilient to bad decisions or scandals like the #ThrottleGate for example.

I wonder what would happen to Apple if Jony Ive suddenly resigns from his position? Does the company have the leadership to persist in preserving their design philosophy? It brings me back to the ancient paradox and thought experiment, The Ship of Theseus stating: Will a ship that has had all of its components replaced remains fundamentally the same ship? I am increasingly uncertain this will be the case.