Good at what, exactly?

When Apple launched its MacBook Neo in March of this year, its first attempt at what might be called an entry-level laptop, there were plenty of naysayers quick to criticise its specifications and performance. Comparing it to Apple’s more high-end laptops, some reviewers made great play of its lack of a dedicated chip (it is powered by the A18 Pro chip, usually found in iPhones, not the M- series used in other MacBooks) which they found made it sluggish when carrying out complicated tasks that require, for example, memory-heavy graphics applications. Regardless of this misguided criticism, the Neo has been a huge success, selling more than 1.1 million units in its first three weeks alone. At one stage, so many were being sold that some countries reported a shortage.

Those critical reviewers completely missed the point. The Neo was not designed for professional use, instead its target market was (and is) comprised primarily of first-time Mac buyers, such as students (who receive a decent discount when buying it). Its success is a signal that Apple’s punt on offering a reasonably priced, entry-level laptop that would bring in millions of users to the Apple ecosystem (users who might otherwise have bought Windows machines or Chromebooks) has paid off.

The mistake that the Neo’s critics made was to judge something by comparing it to what they thought it should be, rather than how well it succeeds at what it is actually trying to do. Apple wants the Neo to be the best entry-level laptop around, and it largely is. It was never intended to be a powerful machine for design professionals or gamers. Comparing the two is as if they were one and the same thing is nonsense. It is akin to comparing an amateur dramatics society’s production of The Odyssey at a small local theatre with Phillip Nolan’s 250 million US dollars blockbuster. They are not the same thing.

There’s a lesson here for businesses everywhere, both large (such as Apple), and small (such as a start-up still bootstrapping), namely that they should judge themselves only on what they aim to achieve, something that, admittedly, is often easier to say than it is to do, and the bigger the company the harder it gets. The more a firm has spent building a reputation, a value proposition, the more difficult it becomes to let go of the weather vane used to measure that reputation (and Apple had spent two decades telling the world that a Mac means no compromise. The Neo is nothing but compromise, with its phone chip, just eight gigabytes of memory, and a screen not at the level of more expensive models. Apple felt happy enough, however, to be judged by a different benchmark, something that reinvention tends to turn on.

Nintendo did much the same thing when it launched the Wii in 2006, at a time when the console war was an arms race over graphics, with Sony and Microsoft selling the PlayStation 3 and the Xbox 360. Nintendo deliberately shipped a weaker, cheaper box that required its users to wave a plastic remote controller at their screens, and turned a profit on every unit while its rivals flatlined.

When it goes wrong

There is a catch in judging yourself by your own aim, though, and it’s in ensuring that you are aiming in the right place. Choose the wrong target and you can hit dead centre and still lose. Tata discovered this with the Nano, launched in 2008 as the world’s cheapest car at around 100,000 rupees (not much more than 1,500 euros). As a piece of engineering it did exactly what was asked, namely a proper, four-door car for the price of a bargain motorbike. As a product it was not a success, wound down in 2018 after sales and output came to a halt. The trouble lay in the brief: Tata had set out to build the cheapest car when what India’s strivers wanted was their first car, and nobody, the firm later conceded, wants to be seen in the cheapest anything. Tata’s called the label a stigma.

Apple was much cannier. It pitched the Neo as a gateway to bigger and better things, a cheap(ish) machine built to get macOS into schools and universities. The low price was a hook, and Apple, unlike Tata, took care never to let it become the whole of the product. Amazon has done much the same for over two decades, selling Kindles at cost because its boss Jeff Bezos sees value in what people do with the devices (read and buy books), not in their purchase value.

An am-dram Odyssey is never going to trouble Phillip Nolan, but it is never meant to, and the only real mistake would be comparing them. Apple knew which production it was putting on, but its critics did not. A start-up bootstrapping in a spare bedroom and a company the size of Apple face the same question before any other: What is the value in this, exactly? Successful reinvention is the reward for getting the answer right.