Consumer Theory

Discussion on “Why a simple product line is integral to Apple’s success” (Edible Apple, 2009).

Summary:
This article discusses Apple’s success and attributes it to the fact that they limit their product lines so as to not confuse consumers. They’ve succeeded by limiting their products and even by simplifying their product names. Each product is named aptly and even indicates who it is geared for (for example, their laptops are Macbook, Macbook Air, and Macbook Pro). The article contrasts this to Sony and other competitors who may have a variety of makes within one model in the hopes of satisfying every possible consumer. The article states that Apple is successful because it is the best at a few things as opposed to being just alright at many things. It prides itself on being an inch wide but a mile deep, instead of a mile wide but only an inch deep.

Commentary:
Consumers sometimes benefit from limited choice, simply because they have less to choose from. In the case of Apple, if someone knows they want an Apple product, it is very simple for them then to go to an Apple store or Apple’s website and pick the product that best suits their needs. Based on Apple’s reputation, the customer can be fairly confident that they will be receiving one of the best products available on the market.

Firms might benefit from limited consumer choice as well. If they’ve already got a strong reputation, simplifying their product lines creates less confusion and simplicity for their customers. It results in not so much the customers deciding what they want, but rather the firms telling the customers what they want. If someone goes to Apple knowing they want an Apple product but are unsure what to get, having a limited selection makes the customer’s decision process that much easier. It is more efficient from both an economic and time standpoint for the firm to hone in on what the majority of consumers think they want.

This, however, could backfire. If a customer knows exactly what they want and a firm with limited selection does not have that product, any well-informed customer will not settle. They will find an equally as reputable firm and purchase the product that more suits their needs.

Real-World Application:
At it’s simplest, this concept could be explained by an ice cream shop. Let’s say you have one ice cream shop (let’s call it Shop A), and it offers chocolate, vanilla, and strawberry ice cream only. Shop A is known far and wide for making some of the best chocolate, vanilla, and strawberry ice cream available. Now, there is another ice cream shop (Shop B). Shop B offers vanilla, but it also offers french vanilla, vanilla bean, vanilla frozen yogurt, vanilla with chocolate chips, vanilla-chocolate swirl, and vanilla with cookie dough. Likewise, it offers a number of chocolate variations.

Any customer who doesn’t know what they want will tend to pick Shop A. They know that Shop A makes some of the best ice cream in the world and so they are guaranteed quality. Adding different elements and variances to the ice cream confuses this customer and so they go where they know they’ll get a good product.

Any customer who knows exactly what they want could pick either shop. They’ll pick Shop A if they know they definitely want a great scoop of chocolate ice cream. However, if they know they want vanilla with chocolate chips, they would clearly not select Shop A and go to Shop B for their ice cream.

As a “real-life” example, the sun glasses company RayBan implements the same type of consumer theory as Apple.  Just as Apple offers consumers a limited amount of computer models, RayBan only offers four different styles of sunglasses.  While other sunglasses manufacturers produce a variety of styles that a consumer can choose from depending on their personal preferences, RayBan is known for their identifiable image.  By providing limited options, consumers know that they can get a stylish, well-made product, and do not have to waste time trying on countless styles of sunglasses.

Posted by Katie, Laura and Chrissie (Section 3)

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