I've tried. I've tried ever so hard to ignore Rob Enderle. For years now I've turned the other cheek as he predicted Apple's demise and proclaimed the company's every move a flop. But I confess I have limits—I am merely human—and I can not let a recent statement pass me by.
For Mr. Enderle, Chief Demagogue in the Church of Apple's Doom, called Apple "desperate." Isolated like that it seems preposterous, but this was a case where context amps it up to something where words fail.
TMO Artist's Rendition of Rob Enderle's Characterization of Apple
Mr. Enderle's comments were given to The San Francisco Chronicle for a piece about Apple's newest flagship store in Union Square. That piece talks about the store's giant bay doors—the same doors that many think could allow Apple to use the store as a car showroom in the future.
It talks about how Apple has revamped the Genius Bar to a "quieter Genius Grove," and how Apple is seeking to make this location a "town square" where people meet, hang out, and chill. The piece even says, "The idea of encouraging customers to hang out flies in the face of traditional retail thinking, since stores usually depend on high rates of foot traffic to succeed."
Make no mistake about it: this is a big, bold bet. This new Apple Store represents an investment of tens of millions of dollars in time, man power, materials, design, real estate, and effort. Apple began the effort at the height of its success when its retail stores perched atop every metric of success for revenue, traffic, advertisement value—when its retail stores were the envy of the retailing world.
Of course, they still are.
Is Apple Desperate?
Rob Enderle apparently looks at this and sees desperation, saying, "They're getting desperate, much like Apple did in the late 90s, and when companies get desperate they make a lot of mistakes."
Firstly, desperate companies seldom make big, bold bets. Desperate companies double down on those things they deem safe, tried, true. They don't invest tens of millions of dollars to change the most astronomically successful retail strategy the world has ever seen.
Desperate companies do things like cut back hours, lay off employees, reduce wages and benefits, raise prices, and do everything they can to increase customer churn. They sell off expensive buildings for cash, and they cancel projects.
Take JC Penney, a company the original Apple Store cocreator—Ron Johnson—tried to reinvent. His strategy was hailed as visionary at the time, but the company's board of directors panicked when sales dipped in the midst of Mr. Johnson's makeover. The board fired Mr. Johnson, canceled the makeover, and went back to the same strategies (like couponing) that had run their course before Mr. Johnson's tenure. That's the model of a desperate company.
Remember All Those Mistakes Apple Made in the Late 90s?
There's another aspect of Mr. Enderle's statement that infuriates me even more, the clause, "much like Apple did in the late 90s."
The late 90s. You know, when Apple reinvented the personal computing model with the iMac. The Bondi Blue marvel allowed Apple to change the rules by which it competed, ushered in USB, kicked the floppy drive to the curb, influenced industrial design in a wide range of industries unrelated to computers, and reinvigorated Apple.
Ironically, that happened because Apple was actually desperate, but that desperation was in the mid-90s, not the late 90s. Because it was Steve Jobs managing that desperation, rather than the board of directors at JC Penney, Apple made big, huge bets. And in the late 90s, Apple executed on those big, huge bets almost flawlessly.
Before Mr. Jobs, a desperate Apple spewed out dozens of computer models hoping to catch someone's, anyone's eye, and the company did what the rest of the PC industry did, tried to license its software to cloners. A desperate Apple tried to slash prices and compete on the industry's terms.
Again, that's what desperate companies do, and that's not what Apple did in the late 90s. Apple did anything but what a desperate company would do, and that's what Apple is doing today. Apple is reinventing its retail strategy because Apple is a company that makes big, bold bets, and it makes them at a time of its choosing.
That's what makes me so mad about Mr. Enderle's comment about the "late 90s." It's factually wrong, and it's not something based on obscure Apple lore. It was easily checked—though it shouldn't have needed to be—and wasn't, and this factually inaccurate statement was used to prop up a premise that simply doesn't comport with reality.