Apple’s Corporate Imitators Are Borrowing, Not Stealing

Apple’s Corporate Imitators Are Borrowing, Not Stealing

Apple’s recent quarterly earnings demonstrated insane success. As a result, failing companies like Sony and JC Penney have suddenly reorganized their missions to copy Apple.

Unfortunately, they will fail, because they don’t understand why Apple succeeds. 

Why Apple Succeeds 

Apple earned $46.3 billion dollars in the last quarter of 2011. And of that, $13.1 billion was profit.

Big numbers like those are meaningless without comparison. For example, Apple’s profits in the 4th quarter were greater than Google’s revenues.

MG Siegler pointed out an interesting fact this week: Apple’s revenue from iPhone alone is more than all Microsoft’s revenue.

These facts illuminate the new reality of the consumer technology industry, which is not that Apple is in the same league as supergiants like Google and Microsoft, but that Apple is in a league of its own.

Apple is so ridiculously successful, many businesses have given up on their old strategies and have embraced a new strategy of just copying Apple.

They want that secret Applesauce, and are hoping that imitating Apple will bring them some measure of Apple-like business success.

That would be a great strategy, if they really understood why Apple was successful and embraced it. But they don’t understand, so they won’t succeed.

What the Imitators are Imitating

Apple co-founder Steve Jobs once looked up to Sony as a model for how to run a company. Now Sony looks up to Apple.

And no wonder. Contrast Apple’s $13.1 billion profit to Sony’s $1.2 billion loss for the same quarter.

It’s no wonder that Sony’s new President and CEO, Kazuo Hirai, says he wants to embrace Apple’s strategy of “centralized top-down decision-making on products and a focus on software and service combined with hardware.”

Hirai created a user interface Gestapo called the Integrated UX (the UX stands for user experience), which now has authority over product managers across the company — a kind of Japanese, group decision-making version of Apple’s Jonathan Ive, who lords over user experience and industrial design at Apple.

As an example of why this is important, one Sony executive said that before the Integrated UX group was formed, four separate product groups were each working independently on Sony’s iPad killer tablet.

He’s also said that, like Apple does, Sony must focus on “user experience” instead of just making great hardware.

Another company that has transformed its strategy into “just copy Apple” is — are you sitting down? — JC Penney.

The department store chain hired former Apple executive Ron Johnson in November to head the company as CEO.

Johnson was instrumental in developing Apple retail stores and the Genius Bar. JC Penney is hoping that by putting Johnson in charge, he’ll sprinkle magic Apple pixie dust all over the company and drive it to profitability and growth.

In fact, Johnson is doing for JC Penney something akin to what he did for Apple: Transform the shopping experience.

JC Penney stores will be completely redesigned within four years, according to Johnson’s plan. Each store will be divided into 100 or so “boutiques,” with a “town square” at the center of every store.

Johnson has already announced he’s simplifying the chain’s promotions down to three types (every day, monthly and clearance). Last year the company ran an incredible 590 unique promotions.

These moves by Sony and JC Penney sound like good ones. However, they’re unlikely to turn either company into anything remotely like Apple in terms of market share, revenue or profit performance.

Why Apple Succeeds

Both companies are simplifying to reduced costs and customer confusion. Both are focusing less on the product and more on the experience. Both are focusing on innovation.

All these are Apple-esque ideas, and all perfectly fine as far as they go. However, these are not the attributes that make Apple successful.

To illustrate my point, I need only point to Apple’s own history. When Apple was far, far less successful, the company still demonstrated focus on simplification, user experience and innovation.

Apple’s current monster success results from a plan put in place by Steve Jobs in the late 1990s. The plan has the following attributes:

  1. Identify a broad product category that has the attributes of massive future growth, massive scalability and massive profit potential. (In Apple’s case: content.)
  2. Identify the subcategories of this category where users are being frustrated by bad user experience. (In Apple’s case, music, movies, web content, TV, books, magazines and newspapers, etc.)
  3. Develop integrated solutions to control everything from production to consumption in order to create an overall user experience that’s vastly superior to anything else available. (In Apple’s case hardware, ultra-simple-to-use software and online services.) Ignore all the rules, and just create the best experience no matter what.
  4. Time entry into each subcategory based on available hardware technologies and “cultural readiness.” (In Apple’s case, music players in 2001, smart phones in 2007, tablets in 2010 and, next, TVs.)

So you can see that Sony and JC Penney are cherry picking minor attributes of Apple’s strategy that are non-revolutionary. But that’s the opposite of Apple’s approach.

Apple’s approach is total, top-to-bottom revolution and control in all areas of business. It also depends upon a willingness to forgo everything that lies outside the mission.

Apple’s secret is totality instead of superficiality.

When Steve Jobs famously quoted Picasso by saying that “good artists copy, great artists steal,” he meant that great artists (or companies) don’t look to be only superficially influenced by the greatness of others, but instead they take those great attributes in their totality and make it their own.

It’s telling that after quoting Picasso, Jobs expanded on the thought by saying that: “part of what made the Macintosh great was that the people working on it were musicians and poets and artists and zoologists and historians who also happened to be the best computer scientists in the world.” Apple didn’t hire computer people and tell them to borrow from musicians and poets. They hired musicians and poets.

Of course, this is classic Reality Distortion Field hypnotics. But it reveals an idea Jobs had about embracing influences totally, rather than superficially.

At best, Sony’s and JC Penney’s new CEOs are good artists. But they’re not great artists. They’re borrowing ideas from Apple, not stealing them.

So Apple’s imitators are not making Apple’s true source of success their own. And as a result, they will not succeed like Apple does.

Picture of JC Penney CEO Ron Johnson courtesy of WireImage.

  • exicos

    As far as JCPenney goes, I seriously doubt Ron Johnson is trying to convert JCPenney into a copy of Apple. Ron Johnson showed, before working at Apple, how much of a genius he is. He transformed Target Stores into the “cool, hip” retail stores they are today. Target now focuses on design and customer service, over other stores like Walmart or Kmart. So I doubt he’s copying Apple. It just seems that’s the way he thinks.

  • aardman

    I don’t see any indication except your saying so that mere ‘cherry picking’ is going on.  We don’t know yet whether Hirai’s or Johnson’s approach will be a superficial or total approach.  It’s too early to tell.

    Having lived in Target Town (the Twin Cities) the last 25 years, I wouldn’t downplay Ron Johnson’s talents the way you seem to.  To be able to lift Target to its position of the ‘luxury’ discount retailer is a feat no one else has done before or ever since.  Even mighty Walmart could not do it, though they tried.

  • Brandon Azzolini

    Anyone who thinks the man responsible for making Apple retail what it is today won’t turn J.C. Penny is out of their minds, many could argue that companies aren’t copying Apple, but rather the people who make it sing

  • baby_Twitty

    Good post.

  • Hein S

    In the end, it is the Product that sells. Not the store.

  • zagatosz

    Good article. Sony for a long time was the most top down of Japanese companies, in fact one of their greatest successes was the walkman which was built inspite of market research that indicated no one wanted it. It was built because Akio Morita ordered done and created a market that did not exist before. After Morita death Sony became much less focused and more like a traditional Japanese conglomerate. 

  • Steve M Smith

    Of course, as a leader you have to have the balls to get yourself into the position of CEO and then fire the rest of the board.  Only then can you hope to achieve the transformative paradigm shift required….

  • simon bowler

    Steve quoted Picasso but for the record it was actually TS Eliot
    “One of the surest tests [of the superiority or inferiority of a poet] is the way in which a poet borrows. Immature poets imitate; mature poets steal; bad poets deface what they take, and good poets make it into something better”
    The Sacred Wood Essays on Poetry and Criticism Faber & Faber 1921
    http://www.bartleby.com/200/sw

  • simon bowler

    Great article but for the record Steve was wrong in quoting Picasso – it was actually TS Eliot
    Immature poets imitate; mature poets steal; bad poets deface what they take, and good poets make it into something better
    Eliot, T.S., “Philip Massinger,” The Sacred Wood, New York: Bartleby.com, 2000.

  • Nikita Abramenkov

    IMHO there are russian people with some problems undersatanding english spee. In this case i wrote the same article in russian on http://www.applove.ru

  • Nikita Abramenkov

    I think there are some people with russian mother tongue, that means they can not understand Apple’s Corporate Imitators are Borrowing, Not Stealing topic. I wrote the same for better understanding in russian on my website http://applove.ru. Welcome all russian MAC users!

  • Joe VanDerBos

    JCPenney

  • Nathan Glass

    Good customer service goes a long way. There are plenty of stores I totally avoid because of awful shopping experiences.

  • Roger Mercer

    What a beautifully clear and accurate representation of how Apple really works, as opposed to the superficial perceptions among competitors of how Apple works. 

    Good job, Mike.

  • John Neumann

    As far as JC Penny goes, there is certainly room for improvement and innovation. The idea of an Apple store was pretty much universally derided at the time and rightfully so. After all what did Apple have to sell at the time? Overpriced MP3 players and obsolete computers? 

    Apple had, at the time, nowhere else to turn to. Its retail presence, when it could be found was lost amid the clutter of PC products in the back of Best Buy, or even Sears. 

    JC Penny has nothing to lose and everything to gain by changing the retail paradigm. Sears and K-Mart are spinning down the toilet and most other big-box stores can’t say they are doing much better. 

    As far as Sony and others looking to Applefy their products, I agree with the article and don’t see anything but long-term steady declines. Another point, not highlighted in the article, for Apple’s success is that profits were never its priority. Profits are important but only secondary to product innovation, ergonomics and connectedness, or integration of all the products with the next. 

    Apple had a few clunkers along the way (Ping, MobileMe/iCloud, G4 iMac) but they quickly regroup and move on (really Apple, just delete Ping from iTunes and move on. We understand).

    I don’t see the Sonys or Samsungs of the world being able to turn around such large companies with any meaningful results. Apple will be toppled by some Mountain Dew-swilling kid who is right now tweaking and hacking something wonderful in his parents garage. 

  • brianathasport

    Hey Mike, what’s your source on the four attributes you are citing?

  • imajoebob

    A store that’s made up of a group of “boutiques” anchored by a town square.  No, that’s not the EXACT same concept as the Apple Store, where you have a number of separate product centers (iMac, MacBook, iPod, iPhone, etc.) anchored by the Genius Bar.

  • t3kd

    The guy who runs JC Penney came from Apple. I think he knows how Apple is run. I’m not saying you’re wrong, but I think that he’s copying them because that is how he was successful at Apple. 

  • t3kd

    The guy who runs JC Penney came from Apple. I think he knows how Apple is run. I’m not saying you’re wrong, but I think that he’s copying them because that is how he was successful at Apple. 

  • aardman

    The story I heard, and it’s probably apocryphal, was that Sony had a lot of spare cassette player parts lying around and rather than junking it to take the write off, they said hey! we have just the right parts to make a portable, unamped, and speakerless cassette player!

    Probably not true, but it’s a nice story.

  • aardman

    Except the whole point of the Apple Store was that they had a good product but the stores that sold them were awful.

About the author

Mike ElganMike Elgan writes about technology and culture for a wide variety of publications. Follow Mike on Google+, Facebook and Twitter.

(sorry, you need Javascript to see this e-mail address)| Read more posts by .

Posted in Apple, Steve Jobs, Top stories | Tagged: , , , , , , , |