The iPhone 5 is a fantastic product, there is no doubt about that, but I will not waste my time talking about the slick new look, or the bigger screen or the more efficient operating system. Quite honestly, I don’t care for iPhones that much, they are great phones and all, but to me they are just still phones; maybe I don’t have the technical expertise to operate it to its full capacity or the technological savviness to take advantage of all its features, and you know what, that’s Ok with me. What I do appreciate about the iPhone (from the first generation to the freshly released fifth installment) is the effect that it has had as a marketplace game changer.

As a consumer I’ve witnessed the iPhone do marvelous things, and again I’m not talking about the gadget wirelessly synchronizing with my car which allows me to call my family while its GPS guides me trough the city, (although I must admit, that is pretty impressive); but what strikes me the most is its capacity to affect consumer behavior in such a compelling way; it amazes me how one product can drive Apple’s competitors to adapt their business model not only to compete but to survive.

The iPhone 5 release took Apple’s stock value to over $700 a share (less than ten years ago the price was closer to $6), and made it the largest company by value today with a Market Cap of $656 billion. I mean, what kind of product does this? Let’s be serious, any product that generates mile long lines of people anxious to get a hold of a phone, must have a sound market strategy behind it. When I see those lines outside the stores every year or so, I realize that what Apple is selling is not a phone, but a concept; a way of living, I would even dare to say that what they really sell is an identity.

Everything behind the iPhone’s positioning in the market can be traced to pure consumer behavior and market strategy, where everything comes down to the person, not the item. Realistically speaking, widgets are just the means that companies use to sell a concept that satisfies a need much more profound than - in this case - making calls. Now, I’m not making any groundbreaking discoveries here, everyone knows all companies operate the same way, what is amazing here is the amazing effect that Apples’ market strategy has. A strategy that was tested with the iPod, perfected with the iPhone, and is now replicated with the iPad. Again, is not what you sell is how you sell it what makes/breaks the deal.

Let’s think about that for a second, while most companies pay special attention to R&D, and marketing, and budgets, there is no more powerful tool than a well designed strategy, Steve Jobs said it best when he said: “Is not asking them what they want and then making it, is making it and then telling them that they want it”.- To me that is the most accurate definition of strategic innovation.

I don’t need to have an iPhone or any other prime product to realize they represent much more than what the do; products are “great” because they work and because they make you feel good, which means that if you can find a way sell “satisfaction”, no matter what widget you use to sell it, because as long as it works, you will sell a lot of it…
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Diego De la Garza

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  1. Be honest Deigo, you carry an Android.

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  2. Check back on the Strategic Sourceror Monday to see why my iPhone 5 is going back.

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