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Three Lessons the RFID Industry Can Learn From Apple

While RFID products continue to improve, technology providers must do more to make them easier to deploy and safer to invest in.
By Mark Roberti
Jun 18, 2014

Apple is the most successful technology company on the planet. Today, its stock is valued at $643 (adjusting for a recent 7-to-1 split)—down from a peak of $700 in 2012)—and it boasts a market capitalization of $500 billion. Apple has become the "gorilla"—the dominant technology provider—in MP3 players, smartphones and tablets. It is rare for a tech company to dominate any one market, and no other company has done it three times. So as RFID companies seek to foster widespread adoption of their products, it's worth looking at Apple to learn a few lessons.

1) Build the Whole Product
The first MP3 player was introduced in 1997. At the time, consumers needed to purchase a CD-ROM ripper that could copy songs from a music CD to a computer. They had to purchase software to organize songs and copy them to an MP3 player, and they had to purchase the MP3 player itself. This was too complicated for most consumers, so by 2001, sales of MP3 players had reached just 750,000 units.

Photo: iStockphoto
Around 2000, three years after returning to Apple, Steve Jobs surveyed the field of MP3 players and found most either "big and clunky" or "small and useless." He created a team to develop a new MP3 player. At the same time, Apple acquired a company called SoundJam MP, which offered software that ran on Apple Macintosh computers and allowed people to manage digital music and copy songs to MP3 players. Apple improved the SoundJam user interface and added the ability to write to CD-ROMs. The software was released as iTunes in 2001, and the iPod was released later that year.

Sales of MP3 players jumped to 1.6 million units in 2002. Two years later, sales had more than doubled, and by 2007, sales of MP3 players, dominated by iPods, topped more than 150 million units. Apple's iPod sales peaked in the first quarter of 2011, at just less than 20 million units.

The whole product is important because it reduces risk. For nontechnical consumers—the vast majority of us—having to buy a CD-ROM ripper, software and an MP3 player and get them all to work together means subjecting ourselves to risk. What if we can't figure out how to write songs to the MP3 player? Then, we've wasted a lot of money.

Risk is a huge barrier to adoption of RFID technology. What if we buy a lot of tags and readers, purchase expensive software and hire an integrator, and some or all of it doesn't work as advertised? Then, we've wasted a lot of money. Offering a whole product helps ensure the system will work and, therefore, reduces risk.

USER COMMENTS

Stefano Coluccini 2014-06-24 11:28:27 AM
Very nice post Mark! Just a small consideration: Apple market is essentially B2C, RFID, especially UHF RFID, is mostly B2B. IMHO this make a huge difference on the marketing strategies you should apply, isn't it ?

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