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When Hans Snook, the founder of Orange, took the stage at the Institute of Directors (IOD) annual conference in London last year, his company was facing a crisis. The millions of pounds it had spent building up its mobile phone brand was looking like a dubious investment as the number of people buying phones dropped dramatically.
At that point, most people had started questioning the future of the mobile phone industry and even asking whether or not Orange would survive the drop in demand for its phones. The future, as Snook saw it, was not to continue selling phones in isolation, but to move into other forms of mobile communication, including handheld computers and smart homes which could interact with their owners. That transition, he envisaged, would end with Orange evolving from a single product company into a manufacturer that could deliver a lifestyle.
"Orange sees its future as a communications-based life services company. The Orange brand, already a strong asset and a key differentiation, will become one of the world's most valuable life services brands, universally trusted and recognised as straightforward, honest, dynamic, refreshing and friendly," Snook stated at the conference.
From product to lifestyle
Orange is not alone in wanting to deliver lifestyle services. Snook's vision chimed with many other similar messages being made by the big brands. Even before Snook took the podium, the expression "digital lifestyle" had been used by Apple CEO Steve Jobs at the annual MacWorld event in San Francisco to describe the move the computer manufacturer was making to place its products at the heart of the digital home.
In his usual crowd-whipping fashion, Jobs told the Mac faithful they were witnessing the dawn of a new stage in technological development. Unsurprisingly, the Apple Macintosh computer would be at the heart of this lifestyle, controlling and storing digital media, including pictures, video and music.
Jobs was unleashing stage one in a marketing strategy that would be built around messages informing computer users that Apple products would provide them with easy access to the fruits of digital technology, at the same time reminding potential purchasers of rival brands that only Apple could really deliver the tools to enjoy the digital lifestyle. Like Orange, Apple was following a shift away from branding a set of products to branding an experience.
Like many others, Apple has shifted its marketing approach to focus on a lifestyle because of pressures to keep users buying the products and the advertising messages that large computer brands put out.
The Economist explained the situation in its September 2001 branding feature, Who's wearing the trousers? "In the new global economy, brands represent a huge proportion of the value of a company and, increasingly, its biggest source of profits. So companies are switching from producing products to marketing aspirations, images and lifestyles," it reported.
But studying the development of Apple's digital lifestyle campaign provides clear illustrations of the weaknesses in the lifestyle branding approach. The story begins by returning to Steve Jobs in front of a podium in San Francisco in January 2001.
Apple, unlike all the other computer companies, with possibly the slight exception of IBM, is in the unique position of having a brand that is already loaded with connotations that make it different from its competitors.
The long-running advertising campaign "Think Different" encouraged consumers to embrace the difference and choose the Macintosh path. But being different was not always the most successful marketing strategy. In the 90s, a series of chief executives came and went after failing to get Apple's share of the worldwide computer market into double figures.
Then the prodigal son returned. Jobs had been a founder of the company but left to pursue other interests. After a series of cutbacks, the highly designed and colourful iMac rolled off the production lines and managed to place Apple back in the spotlight. Jobs re-established the marketing image that Apple was able to offer something different and aimed to provide consumers with a better technology experience.
Cream of the crop
Last year, he started to talk about the digital era and argued convincingly that Apple could provide the tools to reap the benefits of digital music, pictures and video because it developed all of its own software and hardware. Apple commentators immediately picked up the argument and within days of giving the keynote speech, Jobs was getting positive feedback from analysts and commentators he could only have dreamed of.
"Apple is uniquely situated to deliver on the digital lifestyle era in ways Dell, Gateway, Compaq and IBM can only dream of," proclaimed Bob LeVitus in his Mac column in the Houston Chronicle. "That's because Apple controls the entire process, from top to bottom. Apple makes its own operating systems; the others don't. Apple bundles user-friendly software to manage your digital media; the others don't. Apple bundles recording hard-ware and ensures that it works flawlessly with its software; the others - well, let's just say that in a few months they'll be saying theirs 'works as good as a Mac'."
On the Lowendmac.com Web site, Stephan Van Esch commented: "Using a Mac can only enhance the digital lifestyle. [And] Apple is poised to take advantage of this new lifestyle."
The waiting game
Jobs carefully constructed the idea that the digital lifestyle was not just a marketing concept he had thought up but was really happening independent of Apple. But like the Orange wireless mobile communications lifestyle, the major problem is that it does not exist yet.
Consumers are being asked to buy into a world which is often just held together by a couple of products, nothing more. For the foreseeable future, technology products will tend to operate in isolation and the idea of linking different products together to produce a seamless user experience is still fraught with confusion.
"The digital lifestyle will only take off when existing products start to co-exist," says Matt Oldfield, QXL.com computer categories manager. "While companies can still continue to sell different products to maximise sales, they will. Digital lifestyle is a certainty, but only when the buying population starts to demand it. At present, it is purely a marketing exercise with very limited desire."
Don't believe the hype
Despite those problems, the marketing machine is in full swing. Far from dropping the digital lifestyle theme, companies have picked up on it. Each has attempted to make sure the idea becomes their own by labelling the phenomenon differently and co-branding products and services to match their own lifestyle brand, causing yet more consumer confusion.
WorldCom, a communications specialist, has dreamt up the phrase "generation-d". The 'd' stands for digital, but because the company claims anyone can participate in the digital lifestyle it has to offer, the 'generational' concept seems redundant.
"We are all part of generations which have grown up in this [Internet] world," says a spokesperson at WorldCom. "For one group, the reality of a digital way of doing business and living life is a given; it is just there and has to be adopted. For others, the wonder of a new environment has created enthusiasm and drive."
WorldCom describes its generation-d programme as pivotal to its future: "Generation-d is central to WorldCom's business strategy to reinforce its position in the market as the leading data and Internet provider," says its mission statement. "We are all generation-d: It's not about age; it's an attitude that says anything is possible. It's not about technology, but what it allows us to do."
Unfortunately, most of that is untrue. The digital lifestyle idea is not open to all. It is about age and has everything to do with the ability to purchase, control and exploit technology. Those consumers that cannot afford to buy the products and services simply will not be able to take part in the digital lifestyle. The suspicion about the digital lifestyle is that it has been developed with only a minority of people in mind - white American computer literates in their mid-teens to mid-thirties.
A design for life
At Comdex in Las Vegas last year, one of the discussion panels tackled the subject of the digital lifestyle and attempted to pinpoint the brands driving it and where it was heading.
Meeting against the backdrop of consumerist excess, the panel took the following position as their starting point: "Digital technology is moving beyond the world of personal computers and will soon touch just about every aspect of our lifestyle. Music, television, entertainment, the arts, interconnected home appliances - all are experiencing the vibrant and disruptive impact of digital technology."
Tim Bajarin, president of Creative Strategies, chaired the debate and is honest about how limited the digital lifestyle is. "It is defined as a lifestyle in which a person has a lot of digital devices that they use in their life and the PC ties them all together," he says. "It should be a universal experience as the world moves from analogue to digital, but its first real impact is with early adopters in the major developed countries."
Bajarin agrees that the lifestyle promises are being oversold by the technology manufacturers. "Initially, it is more of a marketing mantra, but truth be told, it will eventually become part of the fabric of all lifestyles where digital technology has been integrated into education, information and entertainment."
Losing brand power
Establishing that the digital lifestyle is at best a few years away and could even fail to materialise in the way Apple markets it demonstrates the weakness of the lifestyle branding approach. Fail to get it right and consumers will reject the marketing, damaging the brand as future promises are unlikely to be believed. More now than ever before, consumers are calling the shots and are not easily manipulated by brands.
"Brands are not as powerful as their opponents allege, nor is the public as easily manipulated," claims The Economist. "Many of the established brands that top the league tables are in trouble, losing customer loyalty and value. Annual tables of the world's top ten brands used to change very little. Names such as Kellogg's, Kodak, Marlboro and Nescafe appeared with almost monotonous regularity. Now, none of these names are in the top ten. Of the 74 brands that appear in the top 100 rankings in the past two years, 41 declined in value between 2000 and 2001."
As we all wait with bated breath to see exactly what Steve Jobs says in this year's keynote speech, users will still be waiting to find out when the digital lifestyle is really going to arrive