By Adam Doud | May 8, 2013 7:00 AM
Blackberry and HTC have a bit of a problem. Their problem is they are coming off of losing seasons and they’re trying to get their fans back in the stands. Ok, yes I’m using a sports analogy here, bear with me. The problem is they’re charging just as much for their seats as the third team in town – the one who has won the championship two years in a row. And they’re both surprised when their beer sales are plummeting. In short, Blackberry and HTC pricing against Samsung and Apple is doomed to failure until they can reestablish their premium brands to go with their premium phones.
A Tale of Two Very Different Cities
Let me tell you two more tales that help illustrate my point. HP once released a tablet. At the time it was a pretty decent tablet. It had a fledgling operating system with more apps than Android tablets but far less than Apple. They released the tablet at a price directly competing with Apple – $499 and up. The build quality was ok, but not great, but the perception they were trying to create was that their product was just as good – and therefore priced the same as – the iPad. They failed.
Another company, Amazon, released their own tablet. It was more so a media consumption device than a tablet, but it stood on its own as a pretty decent “Tablet” in that it did the things that most people were doing with tablets at the time. And it did those things as good or even better than the competition. They priced it at a loss, $199 to start, and they set a new standard in the mobile space. Suddenly, a $200 tablet wasn’t just possible, it had become necessary. And they sold (and still sell) like hot cakes.
Some of the lines I’m drawing here between HP’s strategy and that of HTC and Blackberry are not exactly straight. Most glaringly, HP’s Touchpad was nowhere near the quality of Apple in terms of materials, weight, feel, or app ecosystem. The same cannot be said – except perhaps for the app ecosystem in Blackberry’s case – about the One or the Z10. But both HTC and Blackberry are coming from HP’s position of weakness in the market.
It’s All About the Brand
In HTC’s case, the artist formerly known as the “1” line – 1X, 1V, 1whatever, was underwhelming in many respects. When paired against its closest rival, the GSIII, it wasn’t even close (Though I confess, at the time, I was much more impressed by the show HTC put on at it’s unveiling than the GSIII’s debut.) HTC responded in a big way with the HTC One. They used premium materials, with premium software, and the whole phone just reeks of premium. It deserves a premium price right? Sure, but let’s remember, the economy is tough and we’re rebuilding a brand here.
The same goes for Blackberry. Blackberry was once the crown jewel of the smartphone world. So was Palm at one point. Nuff said. Blackberry is coming off of two years with no smartphone offerings at all. For those keeping score, that’s Blackberry 0, everyone else in the universe, at least 2. Mobile technology does not take 2 years off for anyone. Blackberry was basically left behind as the mobile world began to adapt and move forward. Similar to HTC Blackberry brings a great feeling phone with some really innovative features, such as Peek, screen sharing, and Alicia Keyes. But again, they’re counting on a following of staunch Blackberry supporters to flock back to them in drove and, it just hasn’t happened.
Both of these companies failed to take into account reputation. Reputation on their part and reputation on Apple and Samsung’s part. Put simply, when you buy a box of Kellogg’s Frosted Mini-Wheats at the supermarket, it is fifty cents more than the generic “Frosted Wheat Squares”. That fifty cents is the cost of the word “Kellogg’s” on the box. Similarly, Samsung and Apple get to add a couple of dozen dollars to their price because, as they say in New York, they’re freakin’ Apple and freakin’ Samsung.
Spoiler alert – they don’t actually say “freakin”.
For The Price Of A Cup Of Coffee Per Day
HTC and Blackberry are the generic cereals in this analogy. They are, for all intents and purposes, lesser brand in this particular world-wide supermarket. They should have priced accordingly. Perhaps not at a loss, although both companies could have potentially made up some profit in other areas – accessories, etc. But an extra fifty dollars, or in my world, a tank of gas (sometimes, living in Chicago really sucks) could have and still could go a long way toward drawing people back into their respective loving embraces.
HTC has already caught on to that fact. Just this past weekend, they ran a promotion offering to trade a $100 gift card for your old smartphone with purchase of an HTC One. Sorry folks, that promotion is over now. But HTC may have gotten the memo that the One going head to head with the GS4 from a strictly consumer standpoint was a pretty tall order.
Lord knows, Pocketnow digs the One. It is a premium device. The Blackberry Z10 is a great device as well, though not as universally loved by the staff. In a perfect world both deserve a premium price tag. But HTC and Blackberry are not in a perfect world. HTC is in a second place world. Second place is first losers. Blackberry is even worse off. Both of them need to put some serious butts in the seats if they are to advance their brand. Hopefully they have some more double coupon days coming up, or Samsung and Apple will continue to dominate.
So let’s hear from you, commenters. If you’re in charge, what’s your retail price tag for the One or the Z10? Did HTC and/or Blackberry get it right? Is their overconfidence their weakness? Is your faith in your friends, yours?