On the flight from Istanbul to Copenhagen I had the pleasure to have a very meaningful conversation with Lalit Soi. Lalit established and operated his highly successful manufacturing company under one mantra. "Provide good customer service". With that principle he managed to create a monopoly in manufacturing.
Looking at today's world there is one company that stands out in providing a good customer service. Apple. If you look the phones, they don't have the best devices, not the best screens not even the latest technologies available. And to that end they only have a single model, iPhone in various versions, the hottest selling iPhone is not even the latest version. Having said that Apple has a huge following and very loyal customer base for the first quarter of 2013 they posted revenue of 43.6B$ with profit of 9.5B$ and pays investor 11B$ in dividends every year.
Compared to Samsung's profit of 6.5B$ from various product groups it is easy to see that Apple is much more profitable. Product by Product Apple by far generates the most revenue and best profit.
Looking at phones Apple shipped 37M iPhones while Samsung shipped 71M phones during the same quarter, however profitability is where Apple differentiates itself from the competition.
So why is Apple so profitable? Why do their customer base pay for more expensive iPhones compared to brilliant Samsung Android phones?
One of the most glaring example I can find in my own little world is CUSTOMER SERVICE. I have visited Apple stores and Samsung shops in various countries and was amazed by how Apple in shop experience is much better than Samsung. This might be bias since in an Apple store there is huge focus on the iPhone while on Samsung shops your attention are directed towards Televisions with their monstrous screens. In an Apple store the customer experience is the same anywhere in the world you go, well at least in cities where I have been (excluding Australia, its pretty much the entire planet). The worse Apple store I have been to is at the city where I live, however that is more of a reflection of Swedish non-service and not a reflection of Apple store service. Another glaring example is how consistent the experience is from an older iPhone to the newest one, a reminiscent of the old Nokia Feature phones where the experience is consistent across the various devices…. If this consistent customer experience is worth 44B$ per quarter then Apple must be doing something right….
Looking at today's world there is one company that stands out in providing a good customer service. Apple. If you look the phones, they don't have the best devices, not the best screens not even the latest technologies available. And to that end they only have a single model, iPhone in various versions, the hottest selling iPhone is not even the latest version. Having said that Apple has a huge following and very loyal customer base for the first quarter of 2013 they posted revenue of 43.6B$ with profit of 9.5B$ and pays investor 11B$ in dividends every year.
Compared to Samsung's profit of 6.5B$ from various product groups it is easy to see that Apple is much more profitable. Product by Product Apple by far generates the most revenue and best profit.
Looking at phones Apple shipped 37M iPhones while Samsung shipped 71M phones during the same quarter, however profitability is where Apple differentiates itself from the competition.
So why is Apple so profitable? Why do their customer base pay for more expensive iPhones compared to brilliant Samsung Android phones?
One of the most glaring example I can find in my own little world is CUSTOMER SERVICE. I have visited Apple stores and Samsung shops in various countries and was amazed by how Apple in shop experience is much better than Samsung. This might be bias since in an Apple store there is huge focus on the iPhone while on Samsung shops your attention are directed towards Televisions with their monstrous screens. In an Apple store the customer experience is the same anywhere in the world you go, well at least in cities where I have been (excluding Australia, its pretty much the entire planet). The worse Apple store I have been to is at the city where I live, however that is more of a reflection of Swedish non-service and not a reflection of Apple store service. Another glaring example is how consistent the experience is from an older iPhone to the newest one, a reminiscent of the old Nokia Feature phones where the experience is consistent across the various devices…. If this consistent customer experience is worth 44B$ per quarter then Apple must be doing something right….
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