The Ipod is it! Unlike the PC, Smart phone, or tablet industries, to say there is a portable music player industry is more of a technicality, because in the grand scheme of things, there isn’t, especially in the mind of the average customer, there is just the Ipod! In my opinion by far the most successful product in this millennium with 315 million units sold, and it is one of the main reasons Apple became the largest company in the US.
Value Proposition
The biggest value the Ipod initially brought was its storage capacity, when others were playing around with 1GB or 2GB for twice the price. Ipod comes out with 40GB, justifying its industry high price; it was and still is the most expensive mp3 player. In addition Ipod came with Itunes, back then buying music online was all over the place, different sites had different catalogs, most mp3s were downloaded illegally (still are). Itunes became the definitive one stop shop, for 99 cents a song, it is quick, it is safe, it is easy.
Customer Segment
Initially rolled out to Mac users, then released to the windows users, Ipod & Itunes took off, and is now for anyone who wants digital entertainment. There are even pre-loaded Ipods available for weird people who don’t have a computer.
Revenue Stream
As previously stated, Ipods were and have been able to maintain its premium pricing, customers recognize its quality and pay for it, no questions asked. They make several hundred dollars per unit, empty, with no content. Then they cough up a buck for every new song they want, some customers spend thousands of dollars on their collection. Itunes is so popular, with millions of people using it for their Ipods, Iphones, Ipads, that millions of customers use it, Apple generates significant advertising revenue.
Ipod is an icon; everyone from kids living in slums to actual royalty has one. Having any other portable media player is like drinking store brand cola, it lacks the status. I own a android phone and a HP laptop, I don’t even know what are the other portable media players currently available, its Ipod or bust!
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