Verizon's fourth-quarter 2008 sales and profit results benefited from its BlackBerry Storm product launch, but I'm not sure the long-term impact will be so kind.
Verizon's fourth-quarter 2008 sales and profit results benefited from its BlackBerry Storm product launch, but I'm not sure the long-term impact will be so kind.Supported with a $100 million marketing budget, BlackBerry Storm represents a two-year effort between Verizon and Research in Motion to respond to the Apple iPhone. RIM also has an interest in expanding its business-focused offering to the larger market of consumer users.
Verizon has admitted that products made it to market "by the skin of their teeth," loaded with software glitches that had forced it to miss an earlier deadline in October. Complaints poured in about hardware functionality, too. A Verizon spokesperson quoted in The Wall Street Journal claimed product return numbers "in the single digits," and that "the sales and performance of the device have lived up to our expectations."
I have two thoughts about this: duh, and huh?
The duh comes from the easy simplicity of low expectations. They knew the product wasn't stable, but chose to run it in Prime Time anyway, so they must not have expected much. Experience, especially with technology products, is a core mechanism for attaching qualities to a brand: the choice between buying something that works versus one that doesn't is a key driver of purchase, even if it isn't completely technically accurate.
So did they trade short-term sales for the long-term health of the brand?
The huh? is my confusion over the overall approach to the product. It seems that the presumption within Verizon (and probably RIM) was that consumers are willing to tinker with technology, are interested in downloading and installing updates, reconfiguring things, and want to discover ways to fix things on their own.
I know readers of this magazine are just such tinkerers. When I've complained in past posts about glitches, many comments have pretty much said deal with it because that's the way of technology products.
But it's not the way of consumer brands. I don't want to have to poke around the innards of my smartphone (metaphorically speaking) the way I do when I want to fix my toaster or air conditioning unit. For the most part, they should just work.
There's no beta period in consumer marketing, and consumer brands aren't founded or built by telling people they need to help do the building. So was launching BlackBerry Storm before it was ready for Prime Time such a good idea?
Server Market SplitsvilleJust because the server market's in the doldrums doesn't mean innovation has ceased. Far from it -- server technology is enjoying the biggest renaissance since the dawn of x86 systems. But the primary driver is now service providers, not enterprises.