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Summary:

It’s fascinating to watch enterprise adoption of Apple technology given its apparent disdain for this market. According to The Wall Street Journal, businesses are tripping over themselves to justify iPad purchases, just a few years after they resisted the rise of Mac and rejected the iPhone.

It’s fascinating to watch enterprise adoption of Apple technology given its apparent disdain for this market. According to The Wall Street Journal, businesses are tripping over themselves to justify iPad purchases, just a few years after they resisted the rise of the Mac and rejected the iPhones in their midst.

All without a penny spent by Apple on marketing to the enterprise.

Well, that’s not quite true. Apple has never (to my knowledge) marketed Macs to enterprise customers, and only hired a skeleton sales crew to sell to such customers, but it has been advertising the iPhone and its business-related applications in The Wall Street Journal, Bloomberg BusinessWeek, and other business-friendly publications. It’s also added Microsoft Exchange compatibility to the iPhone, as well as advanced, CIO-pleasing security.

However, these actions came well after the initial launch of the iPhone, and serve to fuel existing adoption rather than to kickstart new adoption. It’s possible Apple will become more enterprise-centric in the future, but I doubt it. Why? Because Apple doesn’t seem to target markets in the way other companies do.

It targets people. It focuses on users. And Apple lets them decide how and where they’ll use its products.

This sounds simple, but in my experience very few companies think this way. Most startups write business plans that dredge up IDC data on market size, then define their target market (e.g., “Global 2000 enterprises”). Few seem to realize that there are people employed within these target markets, and these people will be the ones who actually embrace or reject one’s product.

Indeed, I’d go so far as to suggest that this is one of the primary failings of most enterprise software today: It’s built for enterprises, not for people employed by the enterprises, a theme echoed by noted developer Michael Nygard.

Not all companies screw this up. The open-source world offers a few good examples of companies that understood their target market was the individual, not the tribe/company.

Marc Fleury’s JBoss, for example, understood its target market was the developer buried within corporate IT. All JBoss’ early marketing was focused on developers, not CIOs, and its product development was focused on making developers happy. Only later did those developers return the favor by pushing JBoss into serious production, requiring the CIOs to get involved.

Along the way, JBoss took its share of criticism for this indifference to decorum and CIO concerns, including accusations that the company “astroturfed” to drum up developer support. True or not, the accusations don’t diminish JBoss’ clear success winning over developers by catering to developers.

The same is true of SpringSource, which fought off the accusation that it wasn’t “enterprise ready” by being “developer ready” from the start, and focusing relentlessly on pleasing its target market: the developer.

This is how great companies are built: they focus on individuals and build exceptional products for them, and let these individuals determine how best to make use of the technology.

The enterprise is now clamoring for Apple products because Apple first solved individual employees’ needs. Apple made complex technology easy, an incredibly difficult task as Gartner’s Brian Prentice argues, and individual users rewarded it accordingly. It is this single-minded devotion to making beautiful products work beautifully that may give Apple the edge in the mobile market over Google’s Android, as Andrew Orlowski opines, and which positions it to continue its march into enterprise computing…without really trying.

So the next time a VC asks you about your target market, remember that every market is composed of individual customers, and build your company around those individuals’ needs, not necessarily their employers’.

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By Matt Asay

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  1. I think the real changer for Apple here is the iPad. They can target as many individuals as they want, the iPad is just so good, very well suited for business people. Lighter than a laptop, it’s very appropriate for road warriors who don’t do heavy document editing when travelling anyway. And I’m not even talking of all the upcoming apps and accessories, which will make it even more useful for all kind of professionals. It will do good in the enterprise world. That’s the surprise. And since Apple is a business, they won’t say no to this new revenue stream. If they could also become a music and media company from a computer-only one, they can also transform and embrace the business world. They iPad is their key to that door.

    1. True, but just having a great product doesn’t matter unless there is good customer support. This is where Apple excels. Everytime I go to the Genius Bar, I feel they hold my hand and solve my problems. Even the tech support call is returned within 1-2 minutes.

      I never had that kind of feeling for 25 years of using Windows, until 2 years ago when I got my first MBP.

      If you saw the Antennagate press conference, do you recall how many time SJ said “We love our customers”.

      1. I didn’t watch the conference but I’m not surprised of him saying so. He has always been great in that regards.

  2. Agreed on the iPad, though I’d bet good money that Apple wasn’t thinking “enterprise” when it thought up the iPad. It was thinking of casual browsing of the Web, instant on access to games, etc. The enterprise adoption is a bonus, not the game plan.

  3. “targets people. It focuses on users. And Apple lets them decide how and where they’ll use its products.”

    What are you smoking? Since when has Apple let users decide anything? Seriously, get a grip.

    1. I’m assuming the author is referring to the flexibility that the app-model provides, allowing users to take advantage of whatever available functionality, whenever and wherever. The exception being music, of course.

  4. “It’s fascinating to watch enterprise adoption of Apple technology given its apparent disdain for this market.”

    Really? You’d have to find it first on a significant scale.

    Despite gushing articles like this Apple still have a tiny enterprise presence and most of that is centered around specialist industries.

    We frequently hear how massive numbers of Fortune 500 companies are adopting the iPhone… except they’re not. They’re testing it for compatibility with users so the CEO can use his. Everyone else gets a Blackberry which remais the OS of choice along with dear old WinMo.

    The enterprise market is not clamouring for Apple products. That’s why their market share remains so small. The iPad may have a minimal impact but fundamentally it’s not suited for business use.

    1. Your experience may be so, but at our (Wall St.) company, iPhones have surpassed Blackberries.

      The iPad is highly suited for business use — it’s all in the apps — which may well be developed in-house by larger enterprises.

  5. Sorry but your advice would be futile for others to use, no company should imitate Apple’s way of working, if their focus is the enterprise. Apple works in a veil of secrecy keeping the product development under a tight grip, and that would not be acceptable for many businesses. If you’re planning a major technology rollout for your business, you want to know what’s coming down the pipeline ideally a year or 18 month ahead. Apple’s disdain for the enterprise is no secret, you can look no further than its CEO, who in many occasions has referred to many fortune 500 CIO as orifices, and he has used that word carefully for a reason so as not to call them a#@holes. Steve prefers to sell to consumers is in his DNA and that’s just the way it is. Your observation is a valid on but I wouldn’t give that to other to follow it.

    1. Apple will adapt to the enterprise world with iPad. It’s all about the money opportunity.
      They have dropped the “computers” word from their name. They can do other changes if necessary.

    2. I agree with you, in general, but the point made in this article is that despite SJ’s disdain of Enterprise, Apple is still showing an increasing presence.

      I recently saw an article showing that almost 2/3rds of computers used by college students were Macs. These college grads eventually end up with jobs in Enterprise, and take their love of Mac with them. Some of them will even become CIOs.

      Of course, the product has to be excellent as well. With Apple, that is not an issue.

    3. Yep, I think even SJ is aware of the fact that whether he likes it or not, Apple has walk through the enterprise door. But what about the small business world? I would expect to see more Macs users there.

  6. You make a very good point that Apple doesn’t so much target markets as they target individuals.

    I work in academia and especially in the humanities and social sciences as as a scholar. Time and again in the social and cultural analysis that many scholars make, they abstract human beings and make them into like zombies who are driven by higher discourses or cultural/historical trends. This abstracting individuals and not seeing for who they are and how they operate is a problem that interestingly is pandemic not only within the academic world but in the world of tech companies (as you have laid out in this article) and I would suspect in the world of government and politics.

    Forgetting that what we’re doing (whether research, products, etc.) are really all about people and not about some abstract thing called market, discourse, or historical trend.

    It’s easy to forget that and there are serious undesired consequences from that.

    Thanks for your article. I find it illuminating.

  7. Enterprises are made up of people, too | pinds.com Thursday, August 26, 2010

    [...] Gigaom on the way Apple targets enterprises (or doesn’t target them): It targets people. It focuses on users. And Apple lets them decide how and where they’ll use its products. [...]

  8. Ric Merrifield Thursday, August 26, 2010

    Really well written piece and I think you on to a huge issue.

    I wonder if this is actually a part of something bigger than Apple, something some call the “consumerization of IT” where people have a really great experience with the technologies they use at home, from Facebook, to mobile devices, and then they come into work and use some not-very-friendly user interface on a legacy application and they say – why is my work technology so inferior to my home technology? Can’t I just build an app for what I really need? Enterprises have to stay ahead of that, because there are some real support and security risks mixed in with all of that opportunity to improve productivity and employee morale.

    I think the subtle point may be that it’s not the enterprise that is buying the technology, it’s that the employees (to your point) are bringing the technology into the enterprise and demanding more. I don’t think this is limited to Apple and their products, though the fact that you just touch your iPad and it’s on with no booting up or coming out of hibernation, and it’s fast and easy to use, Apple has really built an amazing product.

    This will be a really fun trend to watch, both from the security side as well as the opportunity and productivity side. I can’t wait to see what’s next. . .

    Thanks for such a good piece.

  9. Vlad (Small Business Blog) Thursday, August 26, 2010

    “Most startups write business plans that dredge up IDC data on market size, then define their target market (e.g., “Global 2000 enterprises”). Few seem to realize that there are people employed within these target markets, and these people will be the ones who actually embrace or reject one’s product.”

    This is wrong on two counts, as far as I know.

    First: any business plan adviser will tell you that you have to specify an average customer from your target market, not just the market itself. If you cater to retail customers – you have to put down everything you know about that customer, including the color of underwear if it makes any sense in terms of the plan. Therefore business plans target end users, not some fictitious markets.

    Second: startups use those business plans to get investments. More often than not the business plan is structured in such a way that would allow effective communication with potential investors and given the liquid state of any business plan it is perfectly fine.

    1. The point you make may be true in theory, but its application is often flawed.

      Google is a good example. Their source of revenue is ads, and all they care about is garnering as many eyeballs as possible. That’s what it gives away Anroid for free to OEMs, let them tweak it and put crap ware on it. Rather than standing up to the wireless carriers like Apple did, Google let’s them cripple Android phones as they see fit.

      The Google-Verizon deal, the collection of Wi-Fi data by its street-view cars, and the default participation on Google Buzz were not actions with consumer focus in mind. Just having a ‘Don’t be Evil’ logo and a similar mission statement isn’t worth it if not followed.

  10. Has anyone considered that Apple has now become, “the elephant in the room,” that enterprises just can’t ignore anymore? Meaning, they have the market cap, the earnings, the products and the brand awareness that businesses have to consider them, even if they are not the choice for most solutions. No longer are they the hippie fruit company that gets it only with the design community. As big and as powerful as MSFT used to be, they no longer consume the conversation. Discussions about the future of IT for Fortune 500 companies can’t just shove or discredit Apple as much as CEOs and IT admin would like to. When companies like MSFT, Oracle, SAP, Sales Force, etc. are talked about in large corporations, Apple has to be part of the discussion. They have too much clout now to be dismissed.

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