Understanding the iPad's Success
21 May 2012 It seems that everywhere you look, the big Android Tablet Revolution is just around the corner. 2012 is going to be The Year of the Android Tablet. Or was that supposed to be 2011? Or maybe it will actually happen in 2013? It's true that the iPad's market share is bordering on the ridiculous. It was one thing when the iPad was the only game in town, but other tablet makers have had a chance to make a splash, and they haven't really made more than a ripple. And let's not forget that when the iPad came out, it was far from the first tablet computer to be released into the market.
So why has the iPad been able to maintain its impressive market share despite such ostensibly strong competition? The answer is far simpler than many would care to admit:
The iPad is the best tablet you can buy.
It may not be the absolute cheapest, or the most powerful, or the biggest, or most compact, but it shouldn't be all of those things. If the only consideration was price, as is often presumed when comparing the tablet market to the PC and smartphone markets, then Amazon's Kindle Fire would probably be dominating the market instead of seeing shipments fall precipitously. Of course price is important, but it's far from the only factor people consider unless they're buying a commodity like rubber bands or paper clips—markets where there is virtually no perceived quality difference among products. A 10-cent paper clip is likely to perform just as well as one that costs a dollar for the vast majority of people who use paper clips. But the same is certainly not true with tablet computers. They are anything but a commodity, and understandably, price is but a single important factor. (And even so, the iPad compares extremely favorably with other 9.7-inch tablets on the market.)
The fact is, when buying a tablet, people consider many factors, including: attractiveness, utility, popularity, durability, ease-of-use, longevity, among others. And the iPad fares amazingly well in those categories, which explains why it continues to run away with the lion's share of the market. If you read through those who claim that the Android Tablet Revolt is about to happen, you'll notice comparisons to the PC and smartphone markets. So, let's explore that.
In the PC market, the once-dominant Mac OS was buried among a veritable onslaught of cheap PC clones—losing in both market share and profit share. In the smartphone market, while the iPhone still leads handily in profit-share, it has taken a back seat to Android in terms of market share. The argument of which is more important—profit share or market share—can be had, but that's another debate. There is no reason to think that the iPhone will suffer the same fate as the Mac in terms of market share, though that sentiment is certainly out there as well (or at least it was back in 2007).
But there are definitely parallels between the PC and smartphone markets which are noticeably absent in the tablet market—for now. Most important is the fact that today's tablet buyers are choosing to buy a tablet because they want one, not because they need one. This is a critical distinction, because the choice is not "Do I get an iPad or do I get an Android tablet?" but rather "Do I get a tablet or not?" Given this understanding, it's no wonder that when people are making the choice to purchase, they are more likely to choose the unquestionable market leader. Both the PC and smartphone markets are ones in which people generally feel compelled to get something. Not many households today are without computers, and perhaps even less people are without mobile phones of some kind. This explains why low price points and hardware that trends towards commoditization can succeed in these markets, but why we haven't seen the same trend with tablets yet. It also explains why iPhone users are shown to spend more money than Android users—because a far higher percentage of Android users as compared to iPhone users are using their smartphones in the same manner as they did their dumb phones.
Of course, it's no secret that the tablet market will one day subsume the PC market, and thus more and more people will be buying tablets not because they want them, but because they feel a real need to have one. I'm not saying that when that day comes the iPad will finally get its lunch eaten by the likes of Android and Windows, but it will be the first point at which those operating systems (as we know them today) will have a serious shot at it. I wouldn't bet against Apple letting that happen without a fight. They'll continue to drop the entry price so that, as CEO Tim Cook put it, "we don't leave a price umbrella for people." Whether Apple will be successful in this regard has yet to be determined, but if their recent success is any indication, I'd say they have a pretty good shot at it.
