The Mac Generation

Joe Wilcox | January 13, 2005, 09:25 AM

Apple's blow-out 2005 first fiscal quarter, where Mac computer sales jumped alongside iPods (granted nowhere near as much), suggests that the so-called "halo effect" is a real phenomenon.

I would strongly encourage other vendors to closely look at Apple's recipe for success, which is much more than about music. Apple has successfully reinvigorated its brand and masterfully courted the youth market, in part with music and the "cool" appeal.

Some of the sociological speculation I've read about the new baby boom--pick a name: Generation Y, NetGen, Echo Boomers--suggests different marketing inflection points than, say, Gen X or Baby Boomers. This younger, growing buying force appears to be more buzz oriented, more influenced by peer choices, more community-decision oriented. Apple has long positioned the Mac as a lifestyle choice, and its loyal customer base has created community. I believe belonging will be powerful marketing for the new boom, estimated at something like 80 million kids, and so far Apple is masterfully selling community and using community buzz to promote its products.

Consider iPod Shuffle marketing, which emphasizes style, belonging (you can be cool, too) and easy use (must I go on again about the importance of synchronization). Granted the flash-based music player has no display or no extras like a FM radio found on competing models. News reports yesterday quoted Creative's CEO as calling the iPod Shuffle "five generations older" as he touted the newfangled features available in his company's flash-based players. Colleague Michael Gartenberg's analysis is right on, about what's wrong with Creative's response. The question companies like Creative should be asking: What is it that consumers, particularly younger buyers, want from a music player? The answer might not be a FM radio or other features, but something else. And the something else might not be more feature choices. Apple has long had a flare for selling the intangible, of, as iPod Shuffle demonstrates, really making less more.

My gut prediction, with no data to offer as validation, is that the new boomers growing up with technology will care much less about speeds and feeds or long lists of features as functionality. Can they use it easily, quickly and in a way that matters most to them and their friends. Another consideration, as a young friend pointed out yesterday: Teenager interests will affect their parents' consumption decisions, whether TV shows, music, movies or technology products. And visa versa, as demonstrated by the punk resurgence (punkers today are the children of yesterday's punk rock listeners now parents). Colleague David Card gets it: "Consumers don't want choice, they want good products." But I argue his observation will hold more true for the new boomers, which are accustomed to technology.

So, my points are two: That the new generation's sociological orientation and technology experience will greatly impact their buying habits. So far, Apple has courted both well with iPod, iTunes and the iTunes Music Store, by belonging and buzz marketing and providing functional products, which, by the way, tend to do what they're supposed to very well.

I would encourage other vendors to take a long hard look at who is buying iPods and Macs and why. Time is now to get a strong handle on the new boomers, many of which are old enough (early teens to early twenties) to have tremendous spending power. Then there are issues about what products that vendors should offer. Using computers as example, I'm convinced that consumers don't so much care about fastest as most useful, and that holds more true for younger buyers. JupiterResearch has lots of data and qualified analysts to help clients. Please, use the resources.

Vendors, if you don't answer these questions now and put the answers into practice, who knows, maybe the new boom won't be called Gen Y or NetGen, but the Mac Generation. Or, gasp, iPodders.