In crowded tablet market, brand identity will matter
- — 15 January, 2011 06:59
When it comes to the bevy of new tablet computers coming to market, a tablet maker's brand will take on more significance than ever.
Brand, which is far broader than "brand name," has become an all-encompassing, almost-indefinable essence of a company. It explains, for example, why many analysts believe Apple will introduce an exciting, successful second-generation iPad later this year. Because it is has the Apple brand, it will shine, they reason.
Indeed, the word "brand" has begun to stretch its meaning beyond a company's trademark or its reputation. It now includes elements such as a manufacturer's popularity, marketing savvy and ability to design and build quality products. Brand has come to encompass the maker's ability to distribute its products widely and to support them and its customers.
By contrast to Apple's iPad, some analysts are already expressing concerns over the way Research in Motion's brand, more specifically, RIM's strong reputation with business users, will affect sales to consumers of its coming PlayBook tablet .
In the same vein, analysts wonder how well Hewlett-Packard, a powerhouse in servers and printers with a strong brand in those areas, will do when it introduces WebOS products, including an expected tablet, at an announcement Feb. 9 in San Francisco.
Ramon Llamas, an analyst at IDC, noted that even though HP has a respected brand, the WebOS that HP acquired with its purchase of Palm last year hasn't proved to be a strong brand in the market. WebOS has powered smartphones such as the Palm Pre and Pixi.
"Even though it's HP, popularity with a tablet or other product is determined by your predecessors, and WebOS didn't really catch on," Llamas said in an interview. "By comparison, iPad is a derivative of iPhone , and now we have PlayBook coming from BlackBerry. But WebOS? Not so much. WebOS traces back to the Pre and Pixi, and the fact was that not a lot of people picked up those phones."
HP's strong reputation with servers and printers will not matter with WebOS, Llamas said. "If you take a look at what HP wants to do with WebOS, HP is big on [saying it will have] a lot of money for marketing," Llamas said. "Well, congrats, but where's the distribution [operation] and where's your customers?"
Llamas said he examined many tablets introduced at the International Consumer Electronics Show in Las Vegas last week but didn't find any clear winners. "A lot of companies said they had tablets, but it was usually just another company waving a banner," he said. "Until a strong brand comes out with a tablet that's well differentiated, there's not a lot of real standouts."
Having a strong brand behind a new tablet will matter because the field of tablets is so large and the category is relatively new, meaning the winners will be those that first get the attention of buyers, Llamas said.
"A strong brand has helped Apple over the years, even through antennagate with iPhone 4, but brand only works so far," Llamas said. "Brand is a big piece [of ultimate success], but not the only piece. In an early market like tablets, having a strong brand helps."
With the crowded tablet market, Llamas and other analysts said RIM and HP will need to strategize ways to use their brands to attract customers who will test and then buy unproven tablets. RIM has strong partnerships with hundreds of wireless carriers globally, which will help the PlayBook, Llamas said.
"People are drawn to a brand, but ultimately influenced by factors such as cost and how well a certain device can execute," Llamas said. "They want to know about the UI and other factors, and what's the bang for the buck, obviously."
Todd Bradley, executive vice president of HP's personal systems group, defended the WebOS in a recent CNBC interview from CES.
Bradley called WebOS, now in version 2.0, the first "truly Web-based OS ... that is very feature rich." He also called it the "only true multitasking OS," because it allows a user to open 20 different apps at once. He said the WebOS will find its way into smartphones, tablets, PCs and other large screen devices, with an introduction at the Feb. 9 event.
"We see an enormous opportunity for customers to get the best Web experience," Bradley added.
HP's Feb. 9 event in San Francisco will follow a Sprint Nextel announcement in New York on Feb. 7, and some analysts said the two could be related. Jack Gold, an analyst at J. Gold Associates, noted that Sprint sold the first Treo handheld from Palm with solid success, giving HP and Sprint something in common.
But because of the two-day difference in the events, Gold speculated Sprint could announce something else, perhaps about the future of WiMax and LTE, or it could offer more details about the RIM PlayBook that Sprint has already announced it will run over WiMax.