Building a business around being cool is really hard. Keeping it there is even harder. But the toughest of all is getting your cool edge back if you ever lose it. The good news for innovators is that refocusing on being credible can be just as profitable as being cool, without as much inherent risk.
Apple is a great example of a company that has been coming out with cool products ever since Steve Jobs and Steve Wozniak started making and selling circuit boards and computers in the late 1970s. Apple’s latest computers and iGoodies are widely perceived as must-have products with people routinely lining up to buy them as they are launched. At $1800, the MacBook Air launched last month is the latest on Apple’s hit parade.
So what will happen if Apple loses its edge? Not a problem if it takes the same approach that Kodak did years ago when its traditional business of photographic films and papers turned to ashes. Kodak is a big company with a long history of introducing cool products that date all the way back to about 1900 when it introduced the very popular “brownie” camera. Kodak saw big problems coming when digital camera sales started going through the roof. Although the company was in the digital camera game from early on, it knew it would face very tough competition from Japanese consumer electronics giants. Kodak simply wasn’t going to remain cool as the competition heated up.
Kodak was able to refocus on B2B offerings using the tremendous credibility it had established over the previous century. The company’s investor information page claims “Kodak is the world’s foremost imaging innovator. With sales of $10.7 billion in 2006, the company is committed to a digitally oriented growth strategy focused on helping people better use meaningful images and information in their life and work. Consumers use Kodak’s system of digital and traditional products and services to take, print and share their pictures anytime, anywhere; Businesses effectively communicate with customers worldwide using Kodak solutions for prepress, conventional and digital printing and document imaging; and Creative Professionals rely on Kodak technology to uniquely tell their story through moving or still images.” These are not consumer product offerings that will have people lining up in droves. Apple brags about its iPhone and having sold over 110 million iPods and over three billion songs from its iTunes online store but it has no major current B2B offerings.
A great advantage of a company that has leveraged and built up credibility to shift from leading edge consumer product offerings towards B2B offerings, is that the business becomes more predictable. This also applies to its R&D returns. Watch and see if Apple remains cool and if it shifts toward increasing its B2B offerings over the next few years. That would decrease the likelihood of the company falling flat on its face if it loses its cool.