Samsung's Advertising Success vs. Apple's Front Runner Blues

The purpose of advertising is to create demand and then sales. If a company that's behind in market and mind share spends enough, it not only influences the customers, it influences the tech community. Is this what's behind the Apple malaise?

We are all creatures born of the advertising era, and we grudgingly admit that while many ads are infuriating, they can also drive traffic and sales, or companies wouldn't bother with them.

When a company cleverly spends tens or hundreds of millions of dollars on effective ads, they can expect to see a major impact on their business. Millions of customers will be influenced. And writers.

On the other hand, I could write here that "Company X" sucks, and perhaps two or three people on the planet would change their personal opinion and alter their buying decision. And so, I argue that advertising, big advertising, affects customers, that creates a wave of product popularity, and then bloggers, seeing the popularity surmise that the product is superior. Or that its major competitor is stumbling.

Got that?

In the past few days, I've seen two interesting charts in two different place. At Barrons, there was some analysis that pulled out the sales of Samsung Galaxy vs iPhones. Then, at the Wall Street Journal, I saw a chart of the money Samsung and Apple are spending on mobile phone ads. The basis is pretty good between these two charts. Mobile phone ad spending vs. mobile phone sales. Here they are side-by-side.

I've called out out 2011 and 2012 sales and advertising, and from a strictly casual perspective, it's hard not to notice the correlation between Samsung's advertising and sales. Put another way, Samsung executives may have asked themselves a perfectly natural question in 2011: how much money do we have to spend in order to put Galaxy smartphone sales on par with the iPhone?

Front Runner Blues

Of course, there are other elements of the assault than pure dollar spending. Another valuable aspect is snark. That is, if you assert that your product is superior, via specs, and add a bit of arrogance and snark, you can create the perception that you have something quantitative to crow about. That's what Apple did against Microsoft with its "Get a Mac" ads. And it's what Samsung has been doing against Apple with its "waiting in line" ads.

The goal of all this is to measure the response. It doesn't really matter whether you can prove that the ads are working (or whether the features are even worthwhile) because advertising isn't an exact science. But if the sales go up, that's good enough.

The nice thing about this process is that the underdog has a quantitative measure of how well it's doing. As the chart shows above, if your product sales go from 10 percent of Apple's to about 80 percent, your ads are doing the right thing. The question is a lot harder for Apple. What is Apple's theoretical market potential for the iPhone and upgrades? It's a more inexact science than measuring toe-to-toe competition.

What's Apple to do?

On Monday, former Apple executive Jean Louis Gassée wrote that Apple is losing the war of words. More specifically and accurately, he wrote that "Apple has lost control of the narrative; the company has let others define its story."

Another way to say that, in my own interpretation, is: What is worth talking about in the Apple world? Or, more directly, who is doing the talking? I recall there was a time when Apple had two very visible spokespersons: Steve Jobs and, in a fashion, Justin Long.

Today, despite the fireside chats of Tim Cook, Apple hasn't been able to create a thread of favorable discussion. What is it nowadays that's, technically, worth talking about in the Apple world? For some writers, that question has translated into a bit of listlessness and dissatisfaction. Poorly thought out, it can lead to a tirade about Apple's lack of innovation when in fact, that's not the issue at all. Apple's products are perceived as great and are in demand.

Along the lines of developing a visible identity, Ken Segall, formerly with TBWA/Chat/Day, thinks that the Apple Genius ads aired during the 2012 Summer Olympics were an attempt to create a sympathetic character that viewers could associate with. But the execution of the ads failed; they didn't work as intended.

No doubt Apple is aware of all this and is pondering how to deal with Samsung's deep pockets, the resurgence of specsmanship in social media, and losing control of the narrative about its own products. To be sure, Apple's historically reticent, self-assured approach is being exploited as a weakness now.

Might Apple be pondering a new spokesperson? Someone who could and would steal the show from Tim Cook and Phil Schiller? Set the world on fire? Shift the focus? Seize the narrative?

Would Apple's shy CEO let that happen?


Business graphic via Shutterstock.