September 12th event, was it a failure for Apple?

After September 12th, 2023 event of Apple, social media was full of videos and messages which were questioning the innovation on Apple products. For some, Apple was not innovating enough and is falling behind the competition. Are they falling behind the competition ? Are they not innovating enough?

I would like to approach what Apple presented on September 12th, 2023 from business angle rather than the product. From my point view, through the event, Apple was giving a lecture to professionals about how a strategy can be executed based on the vision of a company and how everything is logically connected to each other.

I captured 4 main areas where Apple showed powerful execution to secure the benefit to their customers, partners and shareholders.

These are ;

1. Continue to be a leader in innovation through a development engine which they are continuously excelling

2. Continue to deliver higher margins for their shareholders through perfect examples of design for sourcing and design for manufacturing

3. A persistent execution of platform business strategies with introduction of SOS line and roadside assistance services

4. A strong commitment on sustainability through design to last products, maximizing use of recycled components, incentivising return of old products

Let me open those 4 areas a bit by giving examples from their worldwide event.

Continue to be a leader in innovation

We first need to understand what is innovation. During Design Thinking courses at Stanford GSB, we simply define innovation as sum of creation and adoption. You can create something completely new which does not exist before or adopt a process, technology or a model into your product and/or business which also counts as innovation. When the sum is equal to 1, you have innovation so you can have both or one of them.

With that definition in place, adopting USB-C is an innovation on a product. Adopting roadside assistance into your product is an innovation. Creating dynamic island into the design of your product is an innovation. With such perspective, you will definitely see a lot of innovation on latest event of Apple.

Continue to deliver higher margins

For any business, it is essential to deliver enough margins to sustain their business and achieve their ambitions. Sustainability is in the core of every business and to deliver it, businesses need to stay healthy.

People with product development experience know very well that in early stages of product life cycle, introducing a new technology brings higher investment cost and low economies of scale result in higher level of costs. Therefore, many companies want to skip that stage as fast as possible. Apple is introducing new technology on Pro Max models where they sell at significantly high price to keep margins in tact.

Using the same tech in mainstream product such us iPhone 15 which has larger addressable market brings cost reductions. It is due to economies of scale and due to maturity of the tech where investment costs are not relevant anymore. This is a perfect example of design for sourcing. Continue with the same form factor will deliver faster production cycle times and reliable manufacturing. Nice implementation of design for manufacturing.

These will deliver higher margins.

A persistent execution of platform business model

Although there are many product enthusiasts around Apple products, for Apple, 25% of revenues are coming from services and subscriptions. Revenue on service and subs is bigger than the total revenue from Mac, iPad and wearables.

Introduction of services such as Roadside Assistance are opening up new business partnerships in global scale for Apple. This is just one of the examples from many which you can find. Thus, revenues will continue to grow.

Strong commitment on sustainability

We clearly see the momentum Apple has created since the first announcement of their commitment on sustainability. With every event, they are taking bigger steps and changing the gear. Now we are seeing introduction of more recyclable materials in product such as batteries completely produced from recycled cobalt , recycled copper on logic board.

Now, Apple is paying higher returns on old products. They are able to make this offer because they build products to last longer so there is still value in products when they receive them.

Overall, these are the arguments behind my conclusion where I consider Apple event as big success. With these new line-up, Apple continue to show that they are innovative, they are relevant for their investors, they continue to grow and making a bigger positive impact on environment.