Fred Anderson Speaks On Death Spirals, Marketing, iPod, More

When Fred Anderson speaks, people listen; he is Appleis Chief Financial Officer, after all, and has helped Steve Jobs steer Apple out of rough times to its present profit-making presence. Mr. Anderson addressed a group of University of Michigan business students recently as the key speaker in a year-long series of speakers sponsored by the UM Business Schoolis High-Tech Club.

The speaking engagement was covered by the Michigan Daily, which reports that Mr. Anderson offered views on the strategies Apple used to get from record losses to profitability, about the "death spiral" perception that many had in 1996 when he joined the company, and how the company has attacked the music business. From The Michigan News article, Apple CFO lectures about companyis marketing methods:

"People thought we were in a death spiral -- they didnit think weid make it," said Anderson, who joined the company in 1996. He served as the premiere speaker in a year-long series sponsored by the Business Schoolis High-Tech Club. In his speech, which was geared toward business students, he helped explain how a company can reinvent itself and turn profits around, despite many pessimistic predictions from experts.

Just three weeks after joining Apple, Anderson was confronted with the companyis $325 [million] loss, which he attributed to a general decline in the computer industry and the companyis poor connection with its customers.

In order to turn profits around, Apple reorganized its leadership team and focused on reinventing its image.

"Appleis an innovator, and we refused to mortgage our future," Anderson said.


Apple has reversed its slump through new retail outlets and a larger advertising campaign.

The report also says that Mr. Anderson talked about Apple not being very successful at converting PC users. The article does not quote him on the subject, however, but does include a quote that may have been taken out of context. From the article:

On Nov. 30, they will open their first international retail store in Tokyo, and currently have 70 stores around the country. Nevertheless, Anderson admitted they have not been very successful in converting PC users.

"There has been no real marketing effort and poor distribution, and now weire making changes to address that," he said.

Apple spent millions on the Switch campaign, which would be considered a "real marketing effort" in most circles. TMO has contacted the Michigan Daily for clarification. In addition, the original report references a loss of US$325 billion for Apple, which we corrected in the above quote to the proper US$325 million.

Thereis more in the full article, which we recommend as a good read despite the two quibbles mentioned above.