Mac Pro

Why Apple Needs to take Aim at Their Core Customers

On the second day Steve Jobs came back to lead Apple in 1997, I had a chance to meet with him and ask how he planned to revive and save Apple. Apple was $1 billion in the red and we now know they were about 6-8 weeks from possibly going under. He did not hesitate to tell me he had two key initiatives to bring Apple back to health.

The first thing he told me was he was going to go back and take care of the needs of his core customers. He defined these customers as the creative types who loved the Mac as well as engineers, programmers, publishers, and ad agencies. Indeed, these were the users who put the Mac on the map when it was first released in 1984. Jobs felt that, in the time he had been gone, past Apple CEOs had forgotten about these customers as they tried to expand the Mac’s reach in the marketplace.

The second thing he said he would do would be to focus on industrial design. Even then, Jobs saw something none of us did at the time. He started Apple down a path towards making design a cornerstone of all Apple’s future products.

But it was his first initiative that has been coming back to me a lot these days as have I read multiple stories that suggest Apple has been too slow to upgrade products and be more innovative on the Mac, especially when it comes to meeting the needs of their core customers. Various articles suggest Microsoft, particularly with its Surface tablet PCs and their new desktop Surface Studio is now the leading innovator in developing products for the creative professionals and they are starting to steal Apple’s core customers.

Over Thanksgiving, I was told of a person who had been a major Apple devotee and was a serious creative professional. This person decided to buy a high-end Windows machine, adding key processors and components to it. They said the renderings they were doing took considerably less time than it did on their Mac Pro. Consequently, his entire team bought these new modified Windows machines and sidelined the Mac Pros.

This may be an isolated case. I have also talked to other high-end creative types and, given their significant investments in software and hardware designed around Apple products, I just can’t see them ever jumping over to Windows. However, the fact this one creative pro was able to upgrade a Windows machine to deliver more power for faster rendering of their work is not something Apple can ignore.

The one complaint that seems common is it takes Apple too long to bring out new MacBook Pros and Mac Pros to keep up with the growing needs of the creative professionals. This is not necessarily Apple’s fault. They rely on the processor upgrade cycles Intel has on next generation CPUs and especially ones that would meet Apple’s design and power criteria. But it did take them 14 months to bring out a new MacBook Pro, something that has caused frustration from their creative community of users.

I believe Apple still has the creative community high in their focus. Although, to be honest, the products for this class of users are more like trucks than sedans. When Steve Jobs introduced the iPad in 2010, he said PCs were like trucks, designed for specific uses, but the iPad was more like a car and where the largest growth in users would be. Although I believe Apple will always make Mac Pros, MacBook Pros, and MacBooks (representing around $20 billion of their current revenue), I do think that, over time, they would like to see more and more people transition to an iPad Pro and iOS as it has the best link to their services business, which is a huge growth segment for them.

Regardless of Apple’s long term strategy, I do think Steve Jobs’ goal to keep their core customers happy needs to be top of mind for Apple. I also think they probably do need to be quicker in innovating around the Mac Pro platform as it is clear Microsoft has these same customers on their radar and would love to steal them from Apple if they can. While this market is small, the products for these customers have high margins and is still a very lucrative product line for Apple. I don’t think they want to give up any ground to Microsoft if possible and I do expect them to continue to make the MacBook Pro and Mac Pro the best of class tools for the creative community.

Published by

Tim Bajarin

Tim Bajarin is the President of Creative Strategies, Inc. He is recognized as one of the leading industry consultants, analysts and futurists covering the field of personal computers and consumer technology. Mr. Bajarin has been with Creative Strategies since 1981 and has served as a consultant to most of the leading hardware and software vendors in the industry including IBM, Apple, Xerox, Compaq, Dell, AT&T, Microsoft, Polaroid, Lotus, Epson, Toshiba and numerous others.

33 thoughts on “Why Apple Needs to take Aim at Their Core Customers”

  1. Hi Tim,

    What are the chances that Apple is deemphasizing Mac HW due to Intel’s plodding annual performance increases of 5% to 10% versus the A Series annual increases of 25% to 35%? (I believe we have 4 years of history to confirm these as typical performance increases.)

    If this continues for another 3 years, the A13x could match high end Intel chips at a 200M quantity cost of $30 vs x86’s 20M quantity cost of $100 to $200. (And way outperform x86 on a per watt basis.)

    1. There’s matching and matching. CPU speed scores only cover a small part of what CPUs do (looking at the schematics below, less than 25% of the die is the actual processing core, the rest is graphics/video, interfaces, cache …).

      A lot of ARM’s success is because they haven’t had to bother themselves with (all) a lot of the extraneous stuff, either making the features unavailable, or bring them on-chip in a more limited form.

      So replacing an x86 with an ARM in conventional PCs requires the ARM to acquire a bunch more functionality mostly I/O related, so a larger die which will impact costs, and overall system performance (because resources taken up by managing those, v1 syndrome…): SATA, Thunderbolt, USB, graphics oomph, memory and cache…

      There’s a reason why ARM hasn’t quite taken the server or desktop space by storm yet. It’s being large bits (ah !) of functionality. On the other hand, with Apple especially increasingly moving to non-upgradeable at all PCs, maybe a relatively vanilla ARM solution can be used.

      Edit: also, performance progresses on a curve. As ARM gets closer to x86, I’ll bet improvement rate will slow down too.

          1. Indeed. I couldn’t find a transistor count for the latest Kaby Lake, but it’s the same order of magnitude.
            It’s not optimized for the same things though, x86 has very versatile I/O support, high tolerance for multithreading/tasking… I think adding support for tha takes up space and requires an extra level of abstraction that slows things down and adds constraints to the design. Maybe some of the versatility can be done away with (support for different / expandable RAM, storage, lots of I/O), but other things will be harder to get rid of (multi tasking/threading optimization, support for large amounts of RAM, a bit more I/O).

          2. Just realized something: there is one neutral ground where ARM and x86 compete on a equal footing: Chromebooks. I find x86 surprisingly strong there, especially at the high end, even absent a Windows compatibility requirement, and with perfectly serviceable ARM chips available. I think Intel have discontinued their bribing scheme and are selling Atoms at a realistic price nowadays, so that should mean x86 does have arguments once workloads and sizes move up to PC-ish ?

  2. If you add up Apple’s entire user base of iOS & macOS users, it’s approximately 600+ million users. Of that, 500 million users are iOS users and 100 million users are macOS users. Given that, you have to ask yourself, who really are Apple’s core users. Just by sheer number, I would say iOS users.

    I think what the headline should say, is “Why Apple Needs to Take Aim at Their Most Loyal Users”, which usually are Mac users. And even then, studies / surveys have shown that customer satisfaction / loyalty among iOS users is very high.

      1. Point being, that the Mac is not the center of Apple’s strategy like it was in the 80’s and 90’s. That ship sailed the day the iPod came into being. Every device in Apple’s lineup has to earn its spot.

        1. Which then also means that the customers that depend on those products need to earn their spot by extension. Hubris.

        2. I would think, more to the point of the article, why and who do you keep the Mac around for? If Apple’s core user is not also a Mac user, then there is no point in continuing the Mac. Or if the professional is no longer part of that core, then forget the whole “Pro” designation.

          It is no longer clear who Apple considers their core user, either explicitly or implicitly. If the core is now “everyone” that seems counter to what most Apple advocates and evangelists have often stated, that Apple products aren’t for _everyone_. Trying to appeal to “everyone” is a failed strategy for any company that has tried. Or at least that _used_ to be the line. I guess with the success of the iPhone we no longer need that rationalization?


          1. “I would think, more to the point of the article, why and who do you keep the Mac around for?”

            1. iOS Developers
            2. FCPX users
            3. LPX users
            4. Enterprise users (ie: IBM deploying 100,000 Macs)

            Some would even say Windows switchers, but I think long-term the Pad Pro will serve as the as a gateway for these users.

            The Mac user not being Apple’s core user does not mean that I think the Mac is unimportant. It just means that I don’t think that that’s the bulk of the market that Apple serves.

            In 1984, when SJ unveiled the Mac, his vision for it was “the computer for the rest of us”. Computers designed for those who wanted to use technology to improve their lives, not technology for the sake of technology. Today, it is the iPhone and iPad, not the Mac, that have fulfilled that vision. That is why I consider iOS users as Apple’s core users, and the market that Apple is trying to appeal to.

            And you’re right, no company should try to be everything to everybody. That’s recipe for failure. With Apple’s focus on the consumer market, I don’t see them being in danger of that.

          2. I still don’t see how you get around the Mac user not being a core user. Doesn’t mean they are the largest user base. But it means they are the most likely to invest in Apple devices of more than just Macs plus the Apple ecosystem overall. More so than an iPhone user will invest in a Mac. These are the ones who will plunk down the money for the latest and most expensive PC/laptop, or stretch what they can afford, because it is not a casual relationship with Apple products.

            But with how lackadaisical Apple has been with the Mac and, until recently the Macbook Pro, I contend the last three in your list does not seem to be a high priority.

            Although “enterprise” is not really much of a definition of a core user. I would not put them into the “core Apple user” definition. Lower level admins probably don’t need anything labeled “pro”. The cheapest iMac will serve them or even a Mac mini with an old monitor keyboard probably still laying around IT. Do we know who IBM distributed those Macs to and which Macs they committed to? I can’t remember if any of that info was released with the PR.



        ““They are all computers,” he says. “Each one is offering computers something unique and each is made with a simple form that is pretty eternal. The job of the watch is to do more and more things on your wrist so that you don’t need to pick up your phone as often. The job of the phone is to do more and more things such that maybe you don’t need your iPad, and it should be always trying and striving to do that. The job of the iPad should be to be so powerful and capable that you never need a notebook. Like, Why do I need a notebook? I can add a keyboard! I can do all these things! The job of the notebook is to make it so you never need a desktop, right? It’s been doing this for a decade. So that leaves the poor desktop at the end of the line, What’s its job?”

        Good question. And the answer?

        “Its job is to challenge what we think a computer can do and do things that no computer has ever done before, be more and more powerful and capable so that we need a desktop because of its capabilities,” says Schiller. “Because if all it’s doing is competing with the notebook and being thinner and lighter, then it doesn’t need to be.”

        1. Yes, repeating this part…

          “Its job is to challenge what we think a computer can do and do things that no computer has ever done before, be more and more powerful and capable so that we need a desktop because of its capabilities,”

          While continuing to be able to do everything from before, because those jobs didn’t go away. That’s progress.

      3. So its ‘hubris’ on Apple’s part if they don’t continually cater to every niche – no matter how small – in perpetuity? But every other company is free to “innovate” and evolve.

        I just love double standards.

    1. Im not sure how you separate “core” from “loyal”, in this case. I am only guessing here, but I don’t think I am wrong that Mac users are the ones most likely to also be iPhone users and iPad users and most in need of the entire ecosystem to work for them. The creatives I work with are like that. We look for and find ways to use all our Apple devices in our work and non-work lives.

      And as their core users, with the Mac that brought us into the ecosystem, losing the Mac would become our greatest drive out of the ecosystem. What does Apple’s ecosystem mean if I am a Windows user? Not as much as being a Mac user. Which means it will become easier, maybe even necessary to find solutions that work across multiple devices. With Apple’s push to services, this is not what they need.

      Now if the only thing Apple means by ecosystem is iPad/iPhone and the only thing they mean by “services” is Apple Music/Beats. Never mind. As you point out, I am sure Apple won’t lose any sleep by losing 100 million users. At least with Windows, I know PCs are important to MS.


      1. The IOS ecosystem is built on mac hardware. You cannot code an IOS app on a windows machine without violating the Mac OS license agreement.

        That alone proves that the mac is not going to be phased out and that Apple is going to continue to update their mac lineup from time to time.

        The thing is, new chips from intel no longer deliver much improvement over their predecessors. And that means that there’s no point, really, in issuing new macs more often than once every couple of years. At least that seems to be how Apple sees the situation nowadays.

        1. But having a Mac available for the VERY niche purpose of an SDK is not the same as having a Mac PC/Laptop line available for core users. If that is all they consider as their core user base, it is pointless to sell Macs to anyone else.


      2. I think the elephant in the room is “profitable”. Any sane company evaluates customers w/ regards to their instant and lifetime value. Calling them “core” or “loyal” only obscures the question.

        iOS customers are way more profitable than MacOS customers. Both absolutely and in %. Apparently MacOS doesn’t really drive iOS sales either (I’m told they don’t even have a shared port to talk/charge over ^^).

        1. “Profitable” is applicable to both macOS and iOS last I checked. They are certainIy more profitable with iOS from volume. I could be wrong, but in my limited experience Mac users are almost all Apple device users. It has yet to work out much the other direction or at least no one has demonstrated a direct causation that I know of. I would think on a per-user basis, a Mac + iOS user makes Apple more money than just an iOS user. But maybe the difference is too marginal to care and thus the lackadaisical reference to the Mac.


    2. 600 million? I thought Asymco estimated 1 billion active iOS devices (from comments in a recent Apple quarterly report). Even if some percentage of users have multiple devices, that doesn’t mean subtracting Mac users from the overall number. Aren’t around 5 million Macs sold every quarter? For at least 10 years, not counting the millions sold previously?

  3. All the people getting upset over the pace of Mac hardware updates have lost sight of the fact that Intel’s roadmap has slowed down to such a degree that updating to the latest CPUs no longer delivers significant benefits. If the latest intel generation is only 10% faster than the previous one, what’s the point of upgrading?

    Right or wrong, Apple appears to have decided there is indeed no point in issuing regular spec bump upgrades to their machines anymore. Instead they seem to be keeping their eye on the capabilities of intel’s chipsets. If an entire generation or so of CPUs passes by with no real advancement, then they’ve been sitting it out. They waited on macbook pros until Intel delivered Thunderbolt 3 and USB-c support. With Imacs, they’re waiting until desktop Kaby Lake ships in 2017. And I’d be quite unsurprised if they don’t bother upgrading their macbooks to Kaby Lake, because again, what’s the point?

    If I had to guess, I’d say that the cylindrical mac pro did not sell as well as Apple hoped, and they went back to the drawing board, which would explain the lack of updates to it. The nerds mourning that the mac pro is doomed are forgetting that Apple’s coders are nerds too, and they aren’t going to be happy with only an Imac. Apple isn’t going to stop making the Mac that their own employees will want to use to create IOS and MacOS.

    I expect there to be a new mac pro in the next couple of years. It may be more upgradable and expandable than the current mac pro, but it won’t have room for any internal spinning hard drives or for regular PCI-e expansion slots – it seems clear Apple considers those things relics of the past.

    Which brings me to the title of Tim’s post — the reality is that the creative pros who used to be the Mac’s core customers are now in the minority. Apple’s core customers for the mac nowadays are basically everyone who is willing to spend more for a nicer laptop. Apple is selling nearly all the PCs that cost more than $1000 these days, and the people buying those macs are now their core customers.

    1. “And I’d be quite unsurprised if they don’t bother upgrading their macbooks to Kaby Lake, because again, what’s the point?”


      “The nerds mourning that the mac pro is doomed are forgetting that Apple’s coders are nerds too, and they aren’t going to be happy with only an Imac.”

      I would think a maxed out 27″ 5K iMac with 32GB RAM would be more than sufficient for coding. Or no?

      1. Programmers love multiple monitor setups. Not sure an Imac can drive 2 external 5k monitors.

        Also, though, coders are just as vulnerable to irrational spec-measuring contests as anyone else. They may be able to code on an Imac, but many of them will want to have the most powerful machine money can buy even if they don’t need it. And that means a mac pro.

        1. “Not sure an Imac can drive 2 external 5k monitors.”

          It can but it’s kludgy. This from Apple’s website re: 5K iMac

          “Simultaneously supports full native resolution on the built-in display and up to two 4096-by-2160 external displays or one 5120-by-2880 dual-cable external display”

          Given the capabilities of the new 2016 15″ MBP, I’d be shocked if we don’t see similar capability with the next iMac update.

    2. Anyone who needs a Mac Pro, needs to be able to run that sucker with almost every core maxed out for extended periods of time without the core melting down and the fan(s) driving you insane or preventing you from having it the same room.
      The Tube and iMac do not sufficiently meet those requirements and I believe I’ve seen discussion that the Tubes have been failing due to overheating. Not the the Tube isn’t a beautiful piece of engineering and design, but imagine if the Cube was released as the only PowerMac? That didn’t go well, even though there were more obvious choices, and the iMacs are essentially laptop guts behind the screen.
      Trying to to turn pro machines into appliances like iOS is one thing, but pricing then them like they are now, and then not having the ability to upgrade anything after purchase is getting pretty annoying, especially since the only (and barely significant) gain is less size.
      It’s not like you can do serious work on the new MacBooks without having power connected. If you’re only doing stuff that barely moves the needle to achieve the claimed runtime, you might as well stick to an ipad.
      And then they ditch MagSafe. WTF? The ONLY innovation the power supply needed was a socket on the brick so morons couldn’t twist the cable off if Apple was concerned about minimising unnecessary warranty claims. Were the design team only concerned about symmetry on the ports they didn’t want to put in anyhow? Three ports on a portable pro machine? It’s not like you can drag a friggin NAS or rack of drives around in your laptop bag or you can get more than 2TB built in. Going back to firmly plugged in cables for power seems like they forgot the problems it was solving and they have no idea what real world battery useage was going to be on an allegedly pro machine. It’s almost like they were building an alternative iPad Pro.

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