Thursday, January 13, 2011

Never under estimate the role of customer satisfaction in determining which mobile platforms to develop for

I find it rather entertaining to read the tech sites as they debate whether iOS or Android or other platforms are superior, or will win the largest market share. Most of the arguments tend to get political in nature, which is too bad. But rarely do I hear the word "customer" when techies discussion the mobile market, instead the words "open" or "crapware" is often in the conversation.

As someone who grew up in Detroit, I can't help but go back to the conversations that took place when people discussed the auto industry. Detroiters would often talk about how American cars were getting better, that quality was improving, but then often asked "why are more people buying American cars?" The answer lies with customer satisfaction.
In a world where quality is the same, customer do not perceive much of a difference between products. If it is 1960, and your car seems to be breaking down all the time, you don't really question the quality of your car if everyone else's car is in the shop at the same time. Your level of customer satisfaction may not be high, but it there is little to difference between models and manufacturers.

This all changes when you suddenly buy a car that doesn't break down. Suddenly the level of your satisfaction rises dramatically. This customer will be hard to win back, even if you improve the quality of your product. You will have to do something to differentiate your product. For Detroit, it was a choice between innovation (styling, features, luxury) and price. Detroit (generally) went with price. With manufacturing cost high in the US due to the high price of labor and benefits (the best argument for universal health care, in my mind, has always been that it would help employers), this turned out to be a mistake.

Back to phones (and tablets): prior to 2007 the vast majority of smartphones were BlackBerrys. Watch the first two minutes of this video -- part of Steve Jobs's keynote address at MacWorld that introduced the iPhone. It is a good reminder of what the competitive landscape looked like in 2007:

Why go back to 2007 and revisit this? Because here we are three and half years later and lots of tech people are talking about Android this and Android that -- that I completely agree that Android phones and the platform is here to stay. But the idea that the iOS platform is in some sort of danger seems wildly out of touch with reality.

Is Android going to replace iOS? Hardly. I think even most tech writers would agree that Apple's not going away. Why? Customer satisfaction.

For all the complaints about "openness", and difficulties with the app store, customers continue to be very happy with their iPhones. Check, make that very happy with their iPhones.

J.D. Power's 2010 Wireless Smartphone Customer Satisfaction Study clearly shows that, with the exception of battery life, the iPhone outperforms all other phone manufacturers. In the essential categories of Ease of Operation and Features and Design, the iPhone remains number one.

How do you win over these customers? Well, I can think of two ways that have proved to work: attack AT&T's network and design. The network issue is easy to understand: AT&T has had the lowest customer satisfaction ratings among carriers for quite some time, and this hasn't changed. This ends up being the significance of the Verizon move.

The features differentiator seems to boil down to the keyboard, or the lack thereof. In Apple's iPhone introduction, Jobs points out that the keyboard was the element holding back smartphones. "They all have these keyboards that are there whether you need them or not to be there. And they all have these control buttons that are fixed in plastic and are the same for every application.
Now every application wants a slightly different user interface. A slightly optimized set of buttons."

So Apple eliminated the keyboard altogether -- and that, of course, scared the bejesus out of all those texters out there. Some adjusted to the touch scree keyboard, others did not.

The introduction of phones that had touch screens AND keyboards has proved to be a popular option for many cell phone buyers. Nonetheless, the iPhone remains number one in customer satisfaction.

Now there is the iPad. Here again, the level customer satisfaction is high -- in fact, it is incredible. According to the American Customer Satisfaction Index, the iPad has a 86 percent rating, "the highest-scoring product ACSI has ever tracked".

All this can change, of course. But for the foreseeable future, developing for iOS remains a sure thing, and for most publishers, the primary mobile and tablet platform for their first development efforts. My guess is that the introduction of Android tablets will change the landscape somewhat, but not significantly in 2011. For now, the future is pretty well set, it will be up to manufacturers of Android and other OS products to chip away at Apple's position in the minds of consumers.

No matter how superior tech writers may believe Android, or WebOS, or whatever, is to what Apple has to offer, the challenge will be to create doubt in the minds of those who currently own an iOS device. For media executives, though, as confusing as the current state of mobile appears at first blush, there are some clear differentiators to consider -- first among these, I would argue, is customer satisfaction.