Apple needs to crush it

(in more ways than one)

Last week, Apple ended months of speculation by announcing its newest product: the iPad Pro (more on Apple’s own website).?

The announcement itself—as it happens with most Apple products—came with a spectacle of features, imagery, and slick design. The core message was simple: Apple created the most powerful iPad to date, with an M4 chip that is meant to make it an AI powerhouse (more on CNBC). All of this while, simultaneously creating the thinnest iPad to date.

So, go Apple, right? Well, not really…?

This time around, things are a little tougher for the tech giant. In an interesting turn of events, Apple fans responded with equal parts enthusiasm and criticism for the new invention.

As you’ve probably seen in the news already, most of the hate came from Apple’s strategy to announce their new product. In the company’s first ad for the iPad Pro, they show an industrial hydraulic press compressing a series of creative tools with a destructive force (see the ad here). As instruments, sculptures, and buckets of paint are squeezed into one another, the viewer is left with a sense of destruction and chaos. Then, as the hydraulic press lifts itself once more, all instruments have disappeared, leaving behind the thinnest iPad to date. A creative way of showing all that is packed into one piece of tech. Or, as Apple titled the ad, a means to “crush” everything into a single device.

The problem is that the creative community wasn’t too fond of seeing their tools destroyed for the sake of announcing a new iPad—more so when the iPad’s main customer is meant to be precisely those same creatives (more on why this matters very soon). The backlash reached such levels that Apple’s VP of marketing had to issue an apology for “missing the mark” with their ad (more on The Verge).?

But, in a poetic irony, Apple has way more to “crush” than an iPad. We’ve already written about the many threats to Apple’s dominance in recent months (more on ConteNIDO). Today, we want to focus on just one: the imperative to crush the iPad market once more.

Let’s start with the basics. Although you might not think much about Apple’s iPad, it is still one of the most ubiquitous pieces of technology among Apple enthusiasts. The Consumer Intelligence Research Partners recently estimated that, amongst people who own at least one Apple product, 73% owned an iPad (more here). That is only second to the iPhone (88%) and manages to beat Apple’s Mac (50%) and the Apple Watch (58%). So iPads are not to be taken lightly.

More broadly, the iPad has allowed Apple to maintain a level of dominance that it often lacks in other markets. While the iPhone accounts for some 17.3% of the smartphone market and Apple’s Mac represents 25.4% of computer sales, the iPad is in a whole different category (more on Statista and Apple World). Currently, it is estimated that iPads represent 55.5% of all tablets in the world (more on Statcounter). Their closest competitor, Samsung, has nearly half the market share as Apple (some 26.2%).

Yet despite this historic lead, Apple has been in recent trouble over the iPad. Out of a strategic focus on other initiatives (think VisionPro) or a lack of interest in the market, Apple failed to release an iPad last year. That made 2023 the first year since 2014 without an iPad release (more on Computerworld). In a striking coincidence, revenue from iPad sales soon began a steady decline after the last iPad was announced in 2022. By Q1 of 2024, iPad revenue reached a low of $5.5 bn—its lowest since the COVID-19 pandemic (more on YCharts).

So, in a way, we can read the release of Apple’s new iPad Pro as a hope to maintain its dominance over the tablet market while increasing revenues. And, quite likely, that's a large part of Apple’s decision to release the iPad now: it needs to crush the iPad market once more.

Yet there is a second, and perhaps more profound reason as to why the new iPad is so important to Apple. In a way, it is a testing ground for the company’s future.

You see, in recent years, Apple’s accustomed sales model has met with a new foe: changing consumer preferences. While in the early 2000s and 2010s, people enthusiastically changed smartphones every year, the 2020s are the era of stagnation. Since 2018, smartphone sales worldwide have been unable to reach new highs—except for 2021 post-COVID (more on Statista). People, simply put, aren’t buying as many tech products as before.

In the past, the company managed to create excitement over its product year after year, even if recently it has failed to materialize. Now, it needs to prove that it can maintain the same expectations in a bearish consumer market.

The iPad then becomes the perfect testing ground for Apple’s marketing prowess. Or rather, its ability to crush it. As a product, it holds a large appreciation amongst Apple consumers (hence 73% of Apple users own one), and a large control over the market (55.5% market share). Yet, at the same time, sales are at their lowest in years. So, if all goes well, Apple should be able to motivate consumers to trade in their iPads.

That, in a way, is why the backlash to Apple’s most recent ad is of such importance. If the company enrages its most devout user base, it might risk its ability to cause enthusiasm around its products. In an increasingly skeptical market to yearly tech releases, such a skill will become a true proof of force for Apple.

We don’t know what the future will hold for Apple. But what is certain is that the most recent iPad might hold the key to the company’s success. Will Apple crush the market or be crushed by increasingly skeptical consumers?

?