Two weekends ago, I was queuing the music program for a horse riding competition in Northern California. The guy sitting in the audio/visual booth next to me was handling the live streaming video of the competition. Suddenly, he let loose with a stream of invective (I’m glad my microphone wasn’t on!) against the Apple iMac that was serving up the video to the Internet. The program had frozen, and this led to a long tirade in great technical detail about why the Mac operating system is inferior to Microsoft’s Windows Server OS. As everyone knows, this can turn into a fight about religion, and I clearly was in the company of a “Microsoft ” kind of guy, so I wanted to avoid making him angrier with any snarky witticism (although I had to laugh when it was discovered that the hang was due to two brand-new-out-of-the-box JVC cameras that apparently aren’t compatible with Macs). The only bit of Mac-snobbishness that I imparted was the observation that “Apple defines markets- then let’s others consolidate them. “

( “Oh no! “, you may be thinking, “not another Apple story! ” It isn’t so hang in there….)

Not Just Another Apple Story

There were two other bits of news recently that drove the point about “defining markets ” home for me. They both concerned another Apple product – the Apple Watch, albeit indirectly. FitBit announced quarterly earnings that beat expectations, and the company announced that it now commands 88% of the wearable fitness tracker market. On November 3rd, CEO James Park was talking to Jim Cramer on the CNBC financial news network about the company’s recent results, when he claimed that, “Apple – and other smart watches – hasn’t had a material effect on our business. ” The 2nd one came on same day on the same cable TV channel, when the CEO of Pebble (which produces a smart watch), Eric Migicovsky, offered this seemingly contradictory analysis: “I think Apple has brought a ton of attention to this space. In fact, we’ve seen no kind of material impact from Apple entering this space on our sales – in fact we’re selling 2X this year what we were last year. “

What struck me was that both CEO’s of successful companies felt compelled to talk about their companies in comparison to Apple. It reminded me of how all the “British Invasion ” bands of the ‘60’s felt compelled to compare themselves to the Beatles. In fact, guitarist Keith Richards of the Rolling Stones still feels compelled to compare his band favorably to the “Fab Four “. I almost feel sorry for the guy: “Keith! That was 50+ years ago – you’ve got to move on! “

The Sweet Spot: Perpetual Consumer Engagement

As in the past with its desktop PCs, laptops, MP3 music players, smart phones, and internet-connected pad devices, Apple may not invent markets for products, but it certainly defines them. The Cupertino giant is very successful at making itself the yardstick that others use to measure progress with. And that yardstick isn’t merely a list of products with features and functions. Each product contributes in some way to the Brand Value, creating the conditions for community to build up around the Brand. For example, with its iPod device, the product planners knew that it was about the experience of anytime/anywhere music, not just the device. It’s always about community for the Brand and its legions of loyalists.

The question is, what can retailers learn from this? Retailers can build community around the Brand too. I read a column in the local newspaper over the weekend that referenced a concept called “prolasticity “. The term was coined by a consulting firm called K-Hole in a 2012 paper entitled, “A Report On Patience “, and it was defined as “fluid strategies <that> de-emphasize consumption and instead seek perpetual consumer engagement. ” The report discussed how one company (a sports and recreational products retailer) actually urged consumers to not buy their products on “Cyber Monday “, but instead to go out and use the ones they’d already bought. From that and other examples, the report concluded that, “smart companies know that one-time monumental purchases are less valuable than passive awareness of the brand 24/7, and that the real goal is to keep consumers continually in the brand flow. “

In a world where consumers don’t just shop for products, but more for solutions to their lifestyle needs, there’s an opportunity for a strong tie to form between those who need solutions and those who offer them. But it turns out that “perpetual brand engagement ” is encouraged by brand loyalists as much as by the Brand itself. Even in markets that have been shaped by Apple’s vision, there can be an opportunity for differentiation in a crowded market if a community builds up around the product. For example, my RSR partner Nikki Baird is on her third FitBit, but she says that what she likes most about the product isn’t so much the product (although she likes it), but more about the community of people that has built up around the brand, that encourages its members to achieve more of their fitness goals.

This gets to a question that RSR often poses to retailers, “what value does your Brand deliver? ” “Value ” in this context refers to “Maslow’s Hierarchy of Needs ” – Sustainment, Security, Belonging, Esteem, and Wisdom. The answers to that question turn out to be a surprisingly subjective, but one of the ways to tell what value the Brand really delivers is to hear how consumers talk about it. For example, for highly commoditized products that fulfill basic needs (Sustainment), consumers might say, “I love the prices at… “. On the other hand, for products that offer compelling quality or uniqueness (Esteem, Wisdom), consumers might say, “I found it at… “.

The sweet spot is that “Belonging ” space, when customers say, “I love my… “. Those are the retailers that seem to have figured out how the notion of perpetual consumer engagement can work for them – retailers like REI, Apple Store, Cabela’s, Costco. People want to belong, and these companies have figured out how to enable people to feel that they are engaged with and are a part of the Brand.

So, What Value Are You Delivering?

Retailers that are gearing up now for yet another frenzied 4th quarter consuming binge should take a moment and ask themselves, “What value are we really delivering? ” Right now, many find themselves operating in a space that has been defined by others. For example, companies that are kicking off their Black Friday sales by opening their doors on Thanksgiving, or are kicking off their “Cyber Monday ” sales the week before, are merely reacting to something that Walmart and/or Amazon have done. The effect of all that frenzy is to drive the retailer’s Brand Value down to the most basic and most difficult-to-defend value proposition: “I love the prices at… “

I think most retailers know – and certainly every marketing exec knows – that a relationship with a loyal customer has more value than a transaction. That’s not a revelation. What is more interesting is in thinking about how fostering a “passive awareness of the brand 24/7… to keep consumers continually in the brand flow ” can have tremendous value, because those brand loyalists then join together as a community around the Brand. If Apple can do it with a dozen or so “SKUs “, then a retailer can do it with their broad assortments, many fulfillment points, and hundreds or thousands of customer service staff. It’s just a question of focus.