How Apple Wins By Ignoring ‘The Mushy Middle’

Conventional wisdom states that successful companies succeed when they make a good product for a reasonable price aimed at the average Jane or Joe. Right? But what if, instead of that, companies succeeded by either focusing on the high end or the low end, ignoring ‘the average consumer’ altogether?

That might sound a surefire way for a company to self-destruct. But finding success through bypassing the middle is exactly what is being suggested by James Surowiecki in The New Yorker. Looking at companies like Apple on one end, and H&M and Ikea on the other, Surowiecki argues that the high- and low-end markets are thriving. High-end products like the iPhone find a small niche in a huge market by appealing to the trendy and early-adopters – and make gobs of cash in the process. On the other side of the scale, H&M and Ikea rake in the dough by making tonnes of products that are ‘good enough’ but cost significantly less than their mainstream counterparts.

The losers in all of this? Companies like Sony, Dell or G&M who focus on the middle with a massive line-up of products designed to appeal to everyone, but never having a breakout success.

[Source: The New Yorker via Kottke.org]