Apple Doesn't Get It, and Neither Does BlackBerry

For all of the things that Apple (NASDAQ: AAPL  ) does incredibly well, designing or buying inspiring advertising campaigns is simply not one of them. The current series that's airing to promote the iPhone lands somewhere between mildly interesting and utterly boring. BlackBerry (NASDAQ: BBRY  ) , which is in full blown make-or-break mode, continues to either not understand its target market or not be able to reach that demographic.

To put some of this context, Samsung rocketed past all competitors to spend more than $400 million on advertising in 2012, growing its smartphone market share at a breathtaking pace. Samsung's ads work, not just because they're a part of a pricey campaign, but also because they're entertaining and often edgy. If Apple and BlackBerry don't learn this lesson soon, the quality of their respective products may not be sufficient to even maintain the status quo.

The current state of affairs
To place this conversation into some meaningful framework, it's worth looking at the current Apple commercial and at the current BlackBerry commercial. While neither is terrible, neither particularly inspires the purchase of the device, nor differentiates the device being advertised from every other touchscreen smartphone on the market. When I'm considering a new phone, I want to know what makes it different and better, not what makes it just like all of the rest.

In Apple's case, this presents the fallback position for consumers, I fear that the reason the commercial doesn't highlight some unique advantage of the iPhone is that none exists. Particularly if you're considering an upgrade, you want to know what this new version does that your existing phone can't already do. Apple attempted this type of ad by demonstrating that the iPhone 5’s screen was built to thumb size instead of the bulky 4-plus inches the competition offers. These were pulled ostensibly because it dawned on Apple that if you want to watch video on your phone, you don’t care as much how easy it is to navigate with your thumb.

Particularly for Apple, which holds itself out as the leader in both innovation and cachet, an ad campaign that highlights things we all expect our phones to do anyway doesn't get the job done. The tagline might as well read: “Apple. Meeting expectations. Barely.” For multiple generations of the product, the masses considered the iPhone the aspirational device because it was cool and led the way. Apple needs to remind us that it's still in the hunt.

Critical messaging
The case for BlackBerry is even more dire. Once the predominant name in smartphones, BlackBerry is barely a part of the conversation any more. While retailers place so much emphasis on BlackBerry's corporate aspect, its ads seem to be targeting world adventurers. BlackBerry, even more than Apple, needs to let us know what it's been doing all these years and why we should give it a chance over a tested alternative. Apple may not be showing its sex appeal right now, but we all know the thing works.

BlackBerry, in my opinion, should be targeting business users, reminding us that its devices are still the best at something, and educating us about what features make it worth taking a look. Diving across a soccer field that morphs into a pool, and being told to “keep moving,” doesn't feel like a winning approach. I would imagine that I, and many like me, will take that advice and keep moving right to the next option. BlackBerry must get people interested in seeing its devices if it wants to get into the fight.

Getting it done
The Wall Street Journal recently ran a piece that explored the shift that has occurred in smartphone marketing over the past year: "In 2012, Samsung spent $401 million advertising its phones in the U.S. to Apple's $333 million, according to ad research and consulting firm Kantar Media. The onslaught -- including ads that poked fun at Apple while dubbing Samsung devices 'The Next Big Thing' -- has helped Samsung open a huge lead in the global smartphone race." Samsung has spent big, but also it has spent smart.

What has given Samsung such a boost in its ads is the content. Not only do these commercials inform you about how and why Samsung products are superior, but they also create a desire to join that club. Examples include the kids saving a place in the iPhone line for their parents -- "Galaxy phones are young and hip" -- and a story of a wife touching her phone to her husband's to give him some "special" pictures for his business trip. This really needs no explanation as an aspirational concept. The company has deftly created buzz that its competitors lack.

While I would never advocate an investment strategy driven by commercials, keeping an eye on Samsung's marketing prowess and the lack shown by Apple and BlackBerry has become an increasing important element of understanding these three companies.

There's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded, with more than 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


Read/Post Comments (28) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 25, 2013, at 6:26 PM, alan0101 wrote:

    Oh OK, Apple doesn't get it, but you do. Right!

  • Report this Comment On March 25, 2013, at 6:30 PM, Uruzone wrote:

    Your opening line, "For all of the things that Apple (NASDAQ: AAPL ) does incredibly well, designing or buying inspiring advertising campaigns is simply not one of them." makes you sound like an actual fool, not a Motley Fool.

    For three decades, Apple's ad campaigns have captured the imagination of the public and the envy of its competitors. From "1984" to the first colored iMacs "dancing" to The Rolling Stones, to the "I'm a Mac/I'm a PC" campaign, to the dancing silhouettes of iPod users, Apple has CONSISTENTLY demonstrated strength in advertising, staying both extremely creative and extraordinarily cutting edge. The image they project in the process far surpasses what the snarky "holding mom and dad's place in line" did for Samsung.

    Why would anyone read past your opening line?

  • Report this Comment On March 25, 2013, at 6:32 PM, marv08 wrote:

    "To put some of this context, Samsung rocketed past all competitors to spend more than $400 million on advertising in 2012, growing its smartphone market share at a breathtaking pace."

    Well, according to several sources, Samsung's advertising budget in 2012 was 4 billion USD, not 400 million (see e.g. http://www.businessinsider.com/chart-of-the-day-samsungs-mas....

    Also according to several sources: The iPhone 5 and 4S both outsold every Samsung device in the US in 2012, and Apple also outsold Samsung, and even all Android devices combined, in the US in the last quarter (see e.g. http://www.redmondpie.com/apple-maintains-market-share-lead-....

    So, what exactly does Apple not get? (I do fully agree that their ads could be improved though.)

  • Report this Comment On March 25, 2013, at 6:36 PM, Mega wrote:

    Silly me. I though Apple's enormous profits (far greater than Samsung's) were proof that their marketing was working.

  • Report this Comment On March 25, 2013, at 6:39 PM, jordanwi wrote:

    @alan0101 yeah, the author isn't allowed to assess the approaches to advertising, because you love Apple.

    Doug you're absolutely right - Samsung's ads are the best of the 3 by far. I get a chuckle out of them every time, and I'm an Apple guy. Although, from Samsung's position, it's easier to make fun of Apple. Just like it was easy to make fun of PCs when you're the underdog and you have something better to offer. It's difficult from Apple's position, because they're the 'overdog' with a phone that loses out on virtually all specs. They have to pump the beauty of their ecosystem, which is what they're trying to do. It's hard to say they should change the message, since it continues to be so successful, but they should be moving forward.

    Blackberry is a control group for apple and samsung, and they're simply to laugh at. Their advertising campaign is downright silly. The 'be different' campaign has been done a million different ways, and if you can't even do it as well, start over. You're right, they should play to their strong suit, which is (or was) enterprise.

  • Report this Comment On March 25, 2013, at 6:50 PM, NotAfoolHere wrote:

    A fair survey on how well the BBZ10 is selling would be to check sales at a well known vender.

    Released into the USA for only 4 days BBZ10 makes the top ten most sold unlocked cel phone in Amazon history

    Already beating out the BB Curve, BB Bold and one of the Apple 5's

    http://bit.ly/YPepLs

    List on amazon updated hourly.

  • Report this Comment On March 25, 2013, at 6:51 PM, makelvin wrote:

    @alan0101,

    LOL... I think just about any idiot blog writer such as the one writing this lame article always think they know how to run Apple better than Apple. I wonder why they don't simply use their expert skills to make their billions in business instead of writing these lame articles to "advice" Apple what to do.

    The writer first go by saying that "...Samsung's ads work, not just because they're a part of a pricey campaign...", yet Samsung has clearly spend a lot more on their marketing than Apple. In fact, Apple rarely spend that much money on marketing themselves. People seems to just like to talk and write about them without Apple spending much money to do it. And base on this article, clearly, people still seems to still love doing it.

    Secondly, Apple does not need to aggressively try to differentiate itself with others when you are the leader; it is the other's job to do that. That's what make you the leader and the others the followers. By trying aggressively differentiating your products with your competitors, you are lowering to their level and make yourself look like second banana.

    Apple just need to focus on how easy it is to use their products and what their products can do for them and that seems to be what the Apple's ads are aiming for. I do not know if it is Apple best strategy to that; but I also don't think this article's advice will work any better either. The bottom line is I would not want to claim that I know how to run Apple better than Apple. I always wonder why there are so many marketing geniuses around writing these stupid blogs instead of making billions for themselves. :)

  • Report this Comment On March 25, 2013, at 6:51 PM, Mega wrote:

    Per marv08's chart, Samsung has to spend 4x as much on advertising as Apple to make half the profit.

  • Report this Comment On March 25, 2013, at 7:01 PM, TimKnows wrote:

    Apple's ads are boring, but so is their phone. BlackBerry is rocking a killer phone and is doing an amazing job shutting down the competition in the social media. They are in the news as much as Apple and everyone is following the exploits of BB daily. What are they doing wrong?

  • Report this Comment On March 25, 2013, at 7:24 PM, suavan1 wrote:

    just because you write for the Motley Fool does not mean you have to take the last name sake "fool".......cause you sound like a fool.....FOOL!

  • Report this Comment On March 25, 2013, at 8:06 PM, deasystems wrote:

    I agree that Apple's marketing sucks. Fortunately, their products and services rise above the marketing message and sell themselves.

  • Report this Comment On March 25, 2013, at 8:13 PM, bucknasty11 wrote:

    If the person who wrote this article read these post, I would love to ask them have they ever seen a Bentley commercial or a Maybach commercial or even a Rolls Royce commercial. And the answer will more than likely be no. Point is when you are good you don't have to advertise.

  • Report this Comment On March 25, 2013, at 8:41 PM, MaiStock wrote:

    What a disappointing excuse for insight in a website that's designed to give useful insight into investors. First off, the only hard data cited in this "argument" are ad expenditures - which only tell a small piece of the story. Secondly - the premise that Samsung's ads are more effective than Apple's (which have racked up countless industry awards over the years) is completely and totally subjective. Given that many other places on this site recommend buying Apple, this article was a complete waste of time.

    This piece should've been a comment on a message board, not a worthwhile article or blog posting.

  • Report this Comment On March 25, 2013, at 8:51 PM, kanamits wrote:

    "In Apple's case, this presents the fallback position for consumers, I fear that the reason the commercial doesn't highlight some unique advantage of the iPhone is that none exists."

    TRUE!!!!!

  • Report this Comment On March 25, 2013, at 8:57 PM, larryw101 wrote:

    @bucknasty11. You hit the nail on the head with your post.

    I was a strong msft guy with a motorola phone 2 Sony PC's. I now own a mac pro, Iphone and Ipad. My entire family has also converted over to Apple products.

    Note: I have never seen an Apple ad on TV. My change over to Apple was simple. The advertising was from friends and business associates who told me how much they loved their Apple products.

    Once I my first Apple, I was sold.........period !

  • Report this Comment On March 25, 2013, at 8:58 PM, thethreestooges wrote:

    Dough Erman doesn't get it. He sure does not understand Apple philosophy. Apple build what people want instead of wasting money to push their product with hefty advertising. Duh! So simple even a cave man can see through that. Dough, can you not see dut? Apple can't even keep up with customer who want their product, no need to advertise.

  • Report this Comment On March 25, 2013, at 8:59 PM, AboutYourCat wrote:

    A couple weeks ago, for whatever the reason, after reading an article containing the usual blogarrhea found on sites like these, I allowed words, written for no other reason than the incitement of volatility, to affect me. Because of that momentary weakness, I typed a reply and pressed enter, thus initiating a personal waste of time where I've become involved in that which I abhorrer the most, the type of back and forth ridiculous "my daddy is better than your daddy" childish banter which serves no meaningful purpose besides it's perpetuation.

    What did I ever hope to accomplish by responding? What do I hope to accomplish by continuing? Did I think I was going to change the blogger's mind when the existence of their personal agenda is always more important than the subject of his or her writing?

    Do I think my replies ever have any chance of even being read and comprehended when the vast majority of people now have an attention span limited to 140 characters and who relish the opportunity to complain if for no other reason than because there ice cream is cold?

    No, in my opinion, boards like these are detrimental to me and everyone who posts here. It promotes a false sense of accomplishment replacing eye to eye meaningful conversation where people not only have to convey coherent thoughts, but also achieve it while maintaining some semblance of civility and respect. In other words, hiding behind a screen and typing things you'd never have the intestinal fortitude to say in person promotes this confrontational attitude that permeates all aspects of society and allows emotion to easily overshadow truth and logic.

    Our politicians do it every day when they use emotional issues to fragment us against each other hoping to smokescreen the fact that they do nothing to solve the universal problems facing "We, the people" collectively. Have you ever watched them all, both Republicans and Democrats, stand behind a podium talking about problems as if they themselves had just walked through the door and have no responsiblity for those problems' existence? Look at the Congressional roster. Over half of them have been in office over six years, with the majority of that half having been in office over ten. So as "they" point their fingers, who are "they" talking about when "they" say "they" are at fault?

    And while you sit and think what the heck is this guy talking about and why is he bringing up politics? Well, consider this. You can find boards exactly like this where people are responding about the various political stories of the day. They're doing the same thing you and I are doing here, the only difference being the subject is electronics companies and their stock, and the subject there is our country and it's politicians.

    But the one constant is, instead of any personal meaningful discussion, a response is typed, "enter" is pressed and that feeling of having done something, or even worse, the thought of, "wait until they read this" goes through our minds. Yeah, right, wait until they read this. That's funny. Makes you appreciate that old, "sticks and stones will break my bones" thing. Nothing you nor I wastes time typing here is of any consequence to the price of pizza, but the bloggers and the politicians love you for venting it here in the cyberworld instead of holding their feet to the fire out there in the real world.

    As for me, when I hit "enter", that stops now.

  • Report this Comment On March 25, 2013, at 9:07 PM, JT1951 wrote:

    Samsung spends more advertising because they need to. They make something like 47 different smart phones that they need to get the word out on.

    And yes they sell more phones than Apple.... but they do not make more profit. Apple really only sells one phone the iPhone 5. Interestingly enough they sell their older model iPhones ( 4S and 4 ) for their lower priced offering. So just selling one phone they make 70% of the smart phone industry profits. And you are telling us how to run Apple better....... more like Samsung? LOL You write for the right website...FOOL.

  • Report this Comment On March 25, 2013, at 9:07 PM, larryw101 wrote:

    I think Motley Fool doesn't get it, not Apple !

    Come on guys, you have to be kidding ...... right?

  • Report this Comment On March 25, 2013, at 11:09 PM, commercenary wrote:

    OH MY GOD! Ithasbeentwoyears and Applehasn't madeanewPRODUCT! AAHHH! What's going ON? Where's the INNOVATION? The world will never change! The company's going to TANK! AHHHH!!! .

  • Report this Comment On March 25, 2013, at 11:30 PM, ScottAtlanta wrote:

    I was a late adopter of smartphones here in US. I have post grad degrees.

    When considering a "smartphone" the Samsung ads did have a favorable impact on me. I chose a Galaxy Note b/c of the larger screen -- I wanted a device that was primarily a method to connect to the internet and a phone second -- but fits in my pocket.

    Samsung created the Note, and I bought it immediately. I wasn't alone, it was a huge success. So I would say the author's points should be listened to and not mocked reflexively by fanbots.

  • Report this Comment On March 26, 2013, at 12:45 AM, Medley708 wrote:

    Apple is going to the graveyard. Samsung has destroyed it by having a better product. The only thing Apple can do to survive is to cut the price of their phones in half. Another article has stated that Samsung has sold out already. Apple took their eye off the ball and will suffer for it. Samsung has way too many features that young people want.

  • Report this Comment On March 26, 2013, at 12:47 AM, Medley708 wrote:

    Critics have been going wild because the Galaxy S 4 is real competition to Apple's iPhone 5.

    The Galaxy S 4 is packed with the latest hardware and software features like a 13 megapixel camera, eye tracking technology, and even a way to use the phone without touching the screen.

    While the iPhone 5 is still an impressive smartphone, it doesn't hold a candle to the Galaxy S 4.

    The Galaxy S 4 is faster than the iPhone 5.

    Samsung's Galaxy S 4 has a quad-core processor compared the the iPhone 5's dual core processor.

  • Report this Comment On March 26, 2013, at 1:00 AM, NOTvuffett wrote:

    @JT1951,

    Apple has about 20% of the smartphone market. You said, "So just selling one phone they make 70% of the smart phone industry profits". To me, this implies that it is mainly an item with boutique pricing for fan-boys.

    In the above article, Doug Ehrman, a.k.a. TMFdsewrites stated, "In 2012, Samsung spent $401 million advertising its phones in the U.S. to Apple's $333 million, according to ad research and consulting firm Kantar Media. The onslaught -- including ads that poked fun at Apple while dubbing Samsung devices 'The Next Big Thing' -- has helped Samsung open a huge lead in the global smartphone race". If Apple's market share is dwarfed by that of Samsung, why did they spend about 83% as much on advertising in the US? Is part of Apple's cachet because they spend so much on advertising?

    I am not here to judge the relative merits of the OS on different phone platforms, but it seems to me BBRY has gotten a bum-rap. The usual criticism is BBRY doesn't have the "eco-system". This is code language for how many apps are available. Does it matter that Apple has 1/2 million apps? How many apps do you really use?

    My last point: It doesn't seem like Apple has rewarded their investors. Apple has over $100bil sitting on the books. They could do a share repurchase and make the stock soar. Or they could do a significant dividend that would also make it rise and attract more long term investors. (they could have done a special dividend before the end of the year to take advantage of changing US tax law, but they chose not to).

    Personally, if I was running the company, I would select the second option. It is a company that will remain very profitable, but its rate of growth will be diminished. You don't need $100bil+ to develop the next great thing, or even to get it wrong a couple of times.

  • Report this Comment On March 26, 2013, at 1:57 AM, singaporenick wrote:

    Yes,as most posters here say,it is a very poor article which does not understand the Apple model at all.Apple is No. 1 in the States,No. 1 in profitability worldwide,and sells its products because people regard them (rightly or wrongly) as superior to other products.

    Advertising is a very minor issue-he does not understand that we are not talking soap powder or cola here.

    Samsung needs to advertise heavily because it is in a very vulnerable posiiton:it is just one maker of Android phones,it can lose its market over-night if one of the other android makers such as HTC suddenly coms out with a sexy product.

    I would be willing to bet quite a lot of money that in two years time the position of Samsung in the market vis-a-vis whoever will be a lot weaker than it is today.

  • Report this Comment On March 26, 2013, at 2:23 AM, deasystems wrote:

    @Medley708: "The Galaxy S 4 is faster than the iPhone 5."

    No, it is not. As yet, there are no independent performance tests to back up your assertion.

    (I hope you're not so naive as to think that "specs" can allow one to determine real life performance…)

  • Report this Comment On March 26, 2013, at 7:06 AM, bucknasty11 wrote:

    "A dog doesn't bark at parked cars. A dog barks at cars that's moving and going somewhere. A dog usually barks at the moon, but if the moon barks back at the dog, the dog becomes famous".

  • Report this Comment On March 26, 2013, at 7:09 AM, RandomMeaning wrote:

    Don't forget the spiffs Samsung pays to employees at cell phone stores to sell their Samsung phones.

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