There’s been a lot of discussion about RIM since it announced its Q1 2013 earnings yesterday. Today it’s stock price fell almost 20% and the company appears to be in free-fall. While some have blamed it’s outdated handsets and others the failure to keep pace with Apple’s iOS mobile operating system, the problem is, I believe, far more simple than that. RIM has failed to understand its market and, as a result, has failed to market on its strengths.
Rather than being proud to be a BlackBerry and providing compelling reasons – in terms of handset design, operating system functionality and application eco-system – the company lost sight of its market and became obsessed with being an alternative to an iPhone. It forgot that customers who buy BlackBerries don’t want iPhones. They also – wrongly in my opinion – believed they could convince iPhone lovers to switch to BlackBerry. Reports even suggest that the reason for the delay to BB10, announced yesterday, was that senior executives felt that it couldn’t compete with the iPhone 5, which many expect to be launched later this summer. The truth is that a BlackBerry will NEVER be an iPhone… but who, apart from RIM, ever expected or wanted it to? Certainly not loyal BlackBerry customers!
I wrote a few months ago that I believed RIM was the biggest threat to the long-term sustainability of the business, suggesting that it should embrace – and own – it’s niche. BlackBerry users love their devices. The BlackBerry was designed to be a business tool, not a toy. The Enterprise is routed deeply in RIM’s heritage – it’s the foundation on which the company’s success was built, and, I believe, neglecting it – in the pursuit of consumers – will ultimately be responsible for its downfall.
It’s not a new story… RIM won’t be the first company to fall because of a failure to understand its market. It also won’t be the first to have good technology become the victim of misguided marketing. It’s worth remembering that Apple suffered the same problems back in Steve Jobs’ first ‘act’ at the company, but whether RIM will be able to do the same, and pull up from the death dive it finds itself in, will depend on refocusing its attention on business users, developing products that fulfill that niche in the market – and marketing them like its life depends on it. And it very well might!
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