Apple is running a new Ad telling us how great an iPad Pro is as a computer. The 30 second Ad is titled, “What is a computer?”
What is really going on here? This is a simple case of product positioning. To remind you, product positioning is telling (targeting) specific customers (segments) what job you want them to hire the product for. Remember, if you do not position your product they will do it themselves or if they don’t your competitors will do it for you.
You have seen the tablet sales and ASP go down quarter after quarter.
Consumers are holding on to their older generation iPads as long as possible and with no revolutionary features there is no reason to buy new or upgrade. With iPhone, Apple Watch, and MacBook lines Apple is already maxing out our wallet share.
So it decided to target a segment that has budget to pay (business customers) and telling them what specific job it wants them to hire an iPad Pro for.
Is that all net new revenue however? When customers hire one product for a job to be done they may have to fire another. In this case they could be firing Apple’s own MacBook Air. Apple is known for letting its new products cannibalize its past. In the case of MacBook Air it packs incredible amount of value at a very low price point. It does not generate any add-on sales to recoup lower gross margin. On the other hand the MacBook Air drives sales of $129 pencil, $160 keyboard and app sales.
So Apple is happy to let iPad Pro take Macbook Air’s job and stop refreshing the latter line.
Marketing is nothing more than Segmentation, Targeting and Positioning.