Farewell then to my glorious friend the iPod, which has been shuffled off this mortal coil. On 10 May Apple announced that it is discontinuing the iPod Touch, the last iteration of their MP3 player, bringing an end the life of a device that transformed how we discovered, listened to, and shared music. Released in October 2001, the iPod was the first MP3 player capable of storing 1,000 songs. The pocket-size rectangle with a white face and polished steel frame weighed 6.5 ounces and came packaged with cool white earphone cables. Within a few years, it changed consumer electronics and the music industry.
Apple co-founder Steve Jobs had promised his daughter Lisa that he would put 1,000 songs in her pocket, which led to its creation. The ability to listen to a large collection of music on the go was liberating and Apple became market leader. It exploded in popularity, creating the iPod generation. Throughout much of the 2000s, people wandered around with white earphone cables dangling from their ears. It was an aspired personal identity.
The iPod was ubiquitous, selling 450m units. Last year it sold just 3m units, a fraction of the 250m iPhones sold, but the iPod provided a blueprint for Apple by packaging unrivalled industrial design, hardware engineering, software development and services. While its ground-breaking mechanical scroll wheel and tiny monochrome screen might seem quaint by today’s standards, the first iPod was a revelation that launched a portable revolution. It was the first device we control with a thumb swipe, which was remarkable in itself.
The iPod’s development began with Apple’s acquisition of Soundjam, a music management application that became the iTunes digital jukebox, allowing personalisation of music libraries to create playlists and transfer songs. It powered Jobs’ vision for how people would purchase music in the digital age: We think people want to buy their music on the internet by buying downloads.
In 1999, student Shawn Fanning found it hard to search and download songs from the internet. The frustration led him to start the Napster website, enabling users to share mp3 files across the internet. Within a year, the site had sixty million users. The digital music revolution had begun. But Napster, was tormenting the music industry, allowing people to share any song with anyone for free.
Jobs leaned into the music industry’s woes by marketing the ability of Macs to copy CDs with the slogan: Rip. Mix. Burn. The campaign put the music industry in Apple’s corner, allowing them to sell songs on iTunes for 99 cents because they had no leverage. The easiest way to fight piracy was with convenience.
Jobs pushed Apple to make the iPod smaller and more powerful. The nano saw a near doubling of unit sales, but perhaps the iPod’s most important contribution was its role as a catalyst for the creation of the iPhone. As mobile phone makers introduced devices that could play music, Jobs decided that Apple should have the best device. The iPhone drew on the blend of software and services that made the iPod a success.
The iPod was totemic in changing the consumer tech product landscape and laid the groundwork for the way we listen to music today, bringing into the public consciousness the idea that we could have our whole music collection in our pocket on-the-go. With the advent of iCloud in 2011, this morphed into streaming that music rather than storing it locally. Today, the experience of taking one’s music library out into the world has been integrated across Apple’s entire product line, along with access to 90m songs via Apple Music.
However, the most significant innovation from Apple isn’t the iPod, or even the nifty air pods, but their focus on customer experience innovation. Their innovation strategy extended beyond the product and set a new standard of delighting customers and giving an experience above their expectations, as product features became less of a sustainable differentiator. Apple’s customer experience lead innovation was developed with rigorous R&D and meticulous design, pursuing all aspects of the product, delivering specific, distinctive, brand value.
It’s worth reflecting on how revolutionary the iPod was. The Walkman raised the bar, using every available minute of our TDK D90 cassettes, but you were confined to 90 minutes of listening. This evolved into a portable CD player. Wow! But then this little gadget could fit – wait, what? – 1,000 songs? It was mind-boggling. Having your entire music library in your pocket was a remarkably liberating feeling. The choice of what to listen to on demand was staggering. Crucially, the music was yours – made up of albums where you’d spent hours patiently ‘ripping’ them to your iTunes account or downloading in the infinite aisles of Apple’s digital music store.
The tragedy for me and other iPod lovers are now faced has been on the horizon for several years. Apple discontinued the iPod classic in 2014 as an early sign, a lack of any significant updates for the shuffle and nano since 2010 and 2012 respectively increased the sense of foreboding.
Still, as we move on, lets reflect on the key customer focused innovation lessons from the iPod which should form the backbone of any startup’s innovation strategy.
1. Start with the customer & work backwards to the tech
The iPod was not the first MP3 player on the market, Apple were an effective fast follower by refining existing ideas but took a customer centric perspective. The main difference between the iPod and existing players at the time was not the tech but the customer experience focus. Apple may not have invented the first MP3 player, but they did create the first transformational customer experience with portable music.
Apple started with the customer experience and worked backwards to the tech. You can’t start with tech and try to figure out where you’re going to sell it. The vision for Apple started with What incredible benefits can we give to the customer? Where can we take the customer?’ – not with Let’s sit down with the engineers and figure out what awesome tech we have and how we’re going to market that.
Too often entrepreneurs get caught in the trap of a tech-centric approach to succeed simply by being the first to market with new tech. The story of the iPod teaches us that innovation success can be found in being the first to market with a new customer experience – especially when that solves many of the drawbacks and friction with the existing solutions.
2. Know your target customers
Teens and young adults were leading the digital music revolution and went to great lengths to collect songs and curate playlists. So, Apple chose this demographic as their initial target audience for the iPod. They went further with their marketing strategy, as the iPod and iTunes gave Apple brand a unique coolness, but also helped consumers to show that they cared for legitimate purchasing of music and do their bit in stemming online music piracy: I’m not stealing music. I care for artists.
However, iPods posed a challenge in showing off their ownership to the outside world: iPods would be staying in pockets while in use, so how do teens show their coolness? There won’t be any way to grab the attention of other people. What did Apple do? They introduced white earphone cables, a simple marketing game-changer. At the time, all other headphone’s cables were black. A white cord grabbed attention. It stood out from the crowd. Every time you saw a white cord, you were unconsciously aware of the person’s identity as an iPod devotee.
3. Know the competition and how to beat them
Selling a product is about solving customer problems. Innovations happen when you try to solve a customer’s pain. Jobs and his team were passionate music fans. Steve and Wozniak bonded over Bob Dylan. Being passionate music enthusiasts, they understood the problems faced by other fans. Based on their own experience, they identified the issues with existing mp3 players:
- The devices could store only a few songs.
- They had complicated UI.
- All had poor battery life (used AA batteries).
- Syncing songs from a computer was arduous and time-consuming.
- Compatibility issues with file formats and file transfer protocols frustrated customers.
- The devices were bulky and ugly. They were not pocket friendly.
Apple figured out that in order to create a breakthrough customer experience it would need to make a product that could achieve the following:
- Large song capacity – enough to store nearly your entire collection of CDs: 1,000 songs was a high-water mark at the time.
- Small enough to fit in your pocket.
- Extended battery life.
- An intuitive UI and navigation.
- A fast, simple, and consistent method to transfer songs.
The iPod achieved this and worked seamlessly with the iMac and iTunes. Apple created a customer focused eco-system which also brought customers for additional Apple products and services.
4. Connect the Dots
On a visit to Japan, Jobs and Jon Rubinstein (head of R&D for the iPod) met with Toshiba engineers who mentioned a new product, a tiny, 1.8-inch drive with five gigabytes of storage (about a thousand songs), and they were not sure what to do with it. Rubenstein knew immediately what it could be used for. A thousand songs in his pocket! So, Rubenstein negotiated with Toshiba to have exclusive rights to every one of the disks made.
Jobs said: Creativity is just connecting things. When you ask creative people how they did something, they feel a little guilty because they didn’t really do it, they just saw something. It seemed obvious to them after a while. That’s because they were able to connect experiences they’ve had and synthesise new things.
5. Simplicity – remove thinkpoints
In common with all of Apple’s innovations, the simplicity of the iPod from design to navigation to song transfer was its hallmark. Most notably with the iPod was the omission of an on/off switch. Jobs believed that they could provide a seamless experience if the device had few functions and that users could perform some tasks on the computer (using iTunes) than on the iPod. Convenience and simplicity: The users just wanted to listen to songs using their portable devices.
The iPod interface design followed one critical design principle: remove user thinkpoints. People would be buying the new product to save time. Any cognitive load would be a barrier to product adoption. So, make the product easy to use so that users need not think. The scroll wheel transformed the iPod’s ease of use. We have often heard that the key to creating a great product is not what you put in but what you leave out.
Jobs and his team didn’t rest on their laurels. They continued to improve the product experience and constantly explored ways to meet the user’s changing needs. In 2004 came iPod mini, smaller than the original device and less memory. It targeted people who wanted to listen to songs while working out in the gym, jogging, and engaging in other outdoor activities. Mini was a massive hit, driving the iPod to a stunning market dominance with 74% market share of portable music devices.
In 2005, Apple launched iPod Shuffle that played songs in random order. It lacked a display, the trademark scroll wheel, and playlist management features. Users couldn’t navigate and only skip songs. Compact design, low cost, and long-lasting battery attracted users in droves. People loved it.
It’s rare to see any company bold enough to tinker with their popular products, but Apple intentionally did that, they weren’t averse to killing or cannibalising successful products to go again. It allowed them to innovate continuously which made it difficult for competitors to catch them.
As I hold my black seventh-generation iPod touch lovingly in my hand, it remains a tactile wonder and part of me. Ok, it means I have an iPhone and iPod, separate devices, and I still like to ‘own’ my music not rent from a streaming service. The iPod deepened my relationship with my music collection providing a powerfully addictive multi-functional zone of dopamine-triggering distractions and giving intensely personal concentrated listening. And you know what? Joni Mitchell and Neil Young aren’t on Spotify. But they are where they should be: on the whirring hard drive of my trusty iPod.