Marketing, Lying and the iPhone 4

07/14/2010

long nose man square1 150x150 Marketing, Lying and the iPhone 4I’m surprised at how often I hear people say that it’s OK for marketing to lie about products.  I’ve even heard people say that lying about products is marketing’s “job”.  Newsflash: It’s not marketing’s job to lie.  In fact, it’s not OK at all for marketing to lie.  Trust is expensive to rebuild once you lose it.

The Retina Display “Fib”

The topic of how much lying marketing can “get away with” came up recently with the launch of the Apple iPhone 4.  At the launch, Steve Jobs touted Apple’s new “retina display”, describing the resolution as better than “the limit of the human retina”.  This spawned a debate about the technology, starting with several experts who questioned the claim that the display was better than the limit of the human eye.  There were also complaints that Apple had “faked” images of the display in its advertising, showing a resolution that was much higher than the phone could actually display.

The Reception Issue/Non-issue

Just when things had seemed to quiet down a bit, the issue of the new phone’s reception hit the news.  It began with users complaining that holding the phone by the bottom left hand corner would cause it to lose reception and drop calls.  Apple responded by stating that other phones had similar issues and that customers should simply hold the phone differently or buy a case.  Users were not terribly happy with either of those options.  A few days later, Apple issued another statement saying that the problem was really due to the way signal strength was calculated and displayed.  What looked like 4 bars was really only 2 bars in the first place.  Holding the phone in the “wrong” may cause the display to change but the reception didn’t really degrade.  A software update would fix the bar display problem and everyone could go back to loving their iPhone and hating their carrier for providing lousy reception.  Customers continued to grumble about dropped calls but it seems the issue (if you could describe it as one) had been fixed.

Then the intrepid folks at Consumer Reports decided to test it.  It wasn’t pretty.  In a controlled environment their tests showed that the signal strength of the iPhone 4 did significantly degrade if held certain ways and calls could be dropped.  (An aside – they suggested that a bit of duct tape applied to the phone would fix the problem.  Duct tape.  On an iPhone. That image alone is enough to give legions of design-conscious iPhone buyers nightmares).  Consumer Reports then called on Apple to step up and offer customers a fix for the problem in a way that doesn’t require additional consumer expense.

If the tests by Consumer Reports are accurate, there is a serious question about whether Apple knew this was an issue all along and lied to avoid a hardware recall.  What started out as a technical glitch turned into a situation where Apple’s trustworthiness as a vendor has been seriously called into question.

But Aren’t They Still Selling Like Hotcakes?

I’m not a hardware engineer so I have no opinion about whether or not Apple deliberately mislead customers.  Nor am I ruling out the possibility that Apple has a rebuttal to the Consumer Reports testing that proves that the problem isn’t what it seems today.  And despite the problem, the phones are still selling faster than they can make them.

But there has been some damage done.  There are enough people out there that believe that Apple lied about the issue that they will begin the treat the company like liars.   What that means is that every claim Apple makes about its products will be scrutinized in a way it wouldn’t be if we still trusted them.  In the future Apple will be accused of lying, even when they aren’t and if they get caught in even the smallest of lies, it will be front page news.  This risk is being discussed by financial analysts and (in the short term anyway) the stock has take a hit.  The ramifications of the “death grip” incident however will likely be longer term and the cost will be measured in a loss of user trust and increased scrutiny.

The lesson for marketers is that outright lying to your customer base is risky.  Getting treated like a liar is not fun and rebuilding trust in your community is difficult and expensive.

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