Value, Branding, Cool, and War between Apple and Samsung

There is war out there. And the war is no longer cold, hush-hush; rather it is an explicit direct bloody combat. Apple’s strategy to expand its market by diluting affordability barrier through its attractive installment plans launched in collaboration with its trade partners has been met with almost identical campaign by Samsung for its Galaxy range. The body copy, message and creative execution appear remarkably similar to each other.

Galaxy and Apple are both aspirational brands. People want them but their high price restricts their market to top tier of the market. Price advantage is one of the measures of a brand’s command over its customers. Apple’s products including mobile devices have for long commanded huge price premiums. People use expressions like ‘cool’, ‘cult’ and ‘iconic’ to describe Apple products. There is something amorphous about Apple which makes its offers / products beyond comparison. The mystery and mystique of Apple brand has not been any short of what cult gurus have on their followers. Take for instance the connection between Osho and his followers. There is everything but reason why people follow Osho. The connection transcends logic and rationality. Like gurus, some brands manage to intersect with people on highly sacred and valued spaces to create reason defying bonds. At the heart of cult following is dedication stemming out of emotional commitment.  Apple has been of such brands besides Beetle, Saab, Vespa and Harley Davidson. These are magnets to their followers.

But recent advertisements of Apple iPhone are quite opposite to the idea of a cult brand. The appeal is purely rational and attempt is to reach out to a larger set of customers. It is reverse of magnetism, madness, spell and euphoria.  Apple through its new installment program has made its handsets within the reach of a larger set of audience. The new ads questions: ‘Why wait?’ along with a picture of iPhone 5 and mention of words ‘for Rs 16,990’. The body copy of the ad describes three attractive installment plans with a monthly outgo of as small as Rs 1376. 

The competition between Samsung and Apple is quite palpable and direct. In almost identical format, Samsung launched a counter campaign to promote their Galaxy range of smart phones. The headline goes as: ‘The incredibly creative Samsung Galaxy Note II own it for just Rs 99 per day. The message is that now a potential buyer can choose from Galaxy range (Galaxy Note 800, SIII, Note, Grand and Galaxy Camera) of instruments on easy and attractive EMI scheme (monthly outgo as little as Rs 1790). Apple's new-found interest in India suggests a subtle strategy shift

The two things common to both Galaxy and iPhone communication are focus on price and promotion. Price and sales promotion assume importance when brands become similar. The brand parity or commonality renders customer choice slippery. Apple for long enjoyed a status of a brand as ‘beyond compare’. Customers took pride in its ownership and the experiential ‘wow’ rendered its demand inelastic and insulated from competition. But things now appear to be different for brand Apple.  Jan 17, 2013 Forbes post was headlined as ‘perception scores show Samsung, Apple at parity’. The BrandIndex data mentioned in the post says that ‘perception of the iPhone is outpacing perception of the Galaxy; those scores have been trending closer over the past few months’. The crux of the issue here is not which of the two phones is better rather iPhone has become an object of comparison with others.

Brands derive their strength from connections that they forge with customers. There are three fundamental routes to value creation: utility, symbolism, and experience.  Functional brands thrive by delivering utility though performance of certain functions (use ability). Brands in the symbolic space are valued for self-concept enhancement and social esteem (symbolic meaning). And brands can be desired for experiential aspects or hedonic pleasure (sensory gratification).  Performance centric brands compete on logic and reason and hence fail at creating ‘mindlessness’ and ‘passionate devotion’. They continue to be trapped in comparison discourse.  But brands that that jump over cognition and forge affective links through hedonism and psychological significance escape ‘thinking scrutinizing mind’. The ‘cool’ factor stemmed from Apple’s touch, feel and psychological meaning.Samsung Get a Galaxy Note 2 at just Rs. 2,999 per month

The current campaign focused on price and EMIs appeal to reason which is antithesis of what cool brands are all about.  

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