Regardless of what you think about Apple products, when you think of Apple Computer you have to think powerhouse brand. Even when Apple doesn't invent or come out first to market with a product or product feature they just do such a good job of presenting that "not so new or first" item as, well, "Apple special". Apple doesn't just do an exceptional job in image they are exceptional at rolling out product replacements and new product lines. They are one of the top 1 percent of consumer product companies when it comes to their ability to do this.
Last week though we saw a market placement miss from Apple with its new iPad mini. It has to do with the hyper competitive tablet computer market. Microsoft who is the undeniable market share king of computer operating systems has done an absolutely horrible job in the Smartphone and tablet space up until its recent release of Windows 8. This has left an absolute gold mine, high-growth market segment, up for grabs between Apple and Droid-based Amazon tablets. The similarity of their market positioning is uncannily similar. They both provide quality, affordable (more affordable in the case of Amazon) computing devices and tie them into the cloud based delivery of music, video, books and everything else digital you have on your servers.
Amazon was positioned with its larger tablets as the lower-end product to the Apple iPad because of Apple's high resolution "retina" display. Apple was positioned as the "premium" product, with the higher price to match, for 8.9 inch and larger tablets. Now that Apple is moving down to a 7 inch screen product, the iPad mini has blown that equation. Viewed by millions, Amazon spells it out on their home page - "Much More for Much Less". The new Kind fire HD has a better display (30% more pixels) and more hardware features. Now that alone has been Apple's big differentiator with its own products. They have upraded the iPhone, iPod touch and their laptops with the "retina display". Their high definition screen. And they charge a premium in price for it. So here alone Amazon can flip the marketing campaign right back on Apple. Amazon has a higher resolution with its screen in the 7 inch tablet category. BUT, the Kindle fire HD costs 65 percent less to boot.
That is a killer convergence of features and price and I can tell you that far more kindle fire HD units will be sold than Apple iPad mini units. There is no doubt. You can take that bet any day. The mistake in product positioning is so obvious Amazon is harping on it with a headline, side-by-side comparison and a third party snarky review. Good for Amazon to strike hard on the and a lesson to other businesses. When your competitor is weak on price, product features, delivery capabilities, etc. exploit that weakness and tout your strength.
In the case of Apple they couldn't fit a seven inch tablet with a retina display for $329 into their product lineup without killing their iPod touch sales or harming their iPad sales. They weren't prepared to position that product in the market so they did the wrong thing and launched an "inferior" product into the middle of their line up. We see this all the time in the auto industry. It's difficult for a car maker to get the balance right between features and price in the mid-market of cars.
I'm sure Apple will adjust technology on the upper end of its tablet line and adjust the iPad mini to better fit. But for now, in its small market slice Amazon will win the day with millions of units and advance the "Amazon ecosystem" of hardware and digital services over Apple in the coming 6 to 9 months. A lession to learn for sure.