Focus as a survival strategy

Word is Apple are about to release a new cheap laptop. Why is this a bad idea? PAUL WALLBANK

By Paul Wallbank

Speculation is mounting about Apple releasing a cheap netbook. The idea is Apple needs to compete in the ultra cheap sector and their existing range is too expensive in the current market.

While there’s no doubt Apple will have to respond to the difficulties in the market and give up some margins and profits, there’s danger in simply chasing other people’s price points.

Apple’s success is built upon high margin products, not the stack ‘em high, sell ‘em cheap models other manufacturers follow with varying degrees of success. Those high margins allow Apple to offer value added services like free help in their Apple Stores.

While it’s important to meet consumer price points in the current market, pitching a product to meet someone else’s price point is madness. Apple’s market couldn’t be different to that of the Asus EeePC for example.

That people are suggesting companies in Apple’s market and financial positions should be doing these things illustrates just how tough times are in the tech industries. This was flagged in yesterday’s SmartCompany New Years Resolutions article where Amanda Gome specifically clearly flagged IT as an area to cut.

As we learnt in the tech wreck, IT spending is the first to be slashed, and from what I’m hearing there’s a bloodbath looming in the technical services industry.

Others are hearing this too. The website GigaOm and Gartner Research both published tips on surviving the downturn last week.

Gartner’s paper was firmly aimed at tech service businesses, but there‘s plenty of good ideas there for other businesses as well. Their key point is you have to lead the market as followers will struggle.

The GigOm article starts from the same premise as Gartner – businesses need to differentiate themselves from the rest of the market ­– for GigaOm focus and simplicity are the keywords.

Focus and simplicity are how Apple has achieved its position in its market. Right now is the worst possible time to lose this focus.

All of us need to focus on the areas where we have advantages and how we can simplify things for our customers. We need to be talking to our clients now and understanding where their pain points are and how we can help.

Once we’ve done that, we can start getting new ideas and products out there that will help our businesses through the tough period ahead.

Paul Wallbank speaks and writes on how business owners can meet the challenges of the new economy. A business owner himself, Paul has spent over 15 years helping businesses achieve their potential. He has two computer advice websites; PC Rescue and IT Queries, and appears monthly on ABC Local Radio’s Nightlife program and Sydney 702 weekends.

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