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Apple Crushes FAO’s 150 Years of Branding
Social media can be the messenger that drives people and brands to interact. Product design specialists provide insights into how brands can maintain a long-term competitive advantage in a dynamic environment.
A recent article in Design Management Review (DMR) discussed authenticity and brands, and William Faust and Leigh Householder at Ology defined brand authenticity. They suggested that a brand should be clear about what it is and what it stands for; Proper branding is built from the inside out rather than following the latest trends, fads or customer segment. Also, branding best practices is accomplished using a real story, a connection to a fundamental truth, and an appreciation of one’s smart customers.
On a recent visit to the Apple Store at Fifth Avenue and 57th Street in New York City, I was surprised to see a line of customers of all ages pouring out of the store onto the Fifth Avenue sidewalk. The customers (some tourists) were as happy and excited outside the shop as they were inside. While inside, visitors explored the store, trying on products and purchasing some of Apple’s latest technology offerings.
This seems to be a typical customer scenario at this store, and other store locations around the country also experience a steady flow of customers.
Nearby (a 15 second walk past the GM building) is the world famous FAO Schwarz toy store (now owned by Toys “R” Us). As Apple is now, FAO. it used to be a must-see toy store at 57th and Fifth Avenue.
It was world-renowned for its variety of one-of-a-kind products, including toys, entertainment products, and film and television merchandising. Its products reflected the brand’s commitment to quality that its customers had trusted for nearly 150 years, but over the past few years the brand’s image has eroded and customers seem to be smelling blood in the water.
On this particular day, as on many others throughout the year, FAO was suffering from a decline in customers and a lack of interest in its goods.
What also surprised me was the dramatic difference in foot traffic between Apple and FAO stores. The FAO was relatively empty, although the streets were packed with tourists looking for an air-conditioned, fun shop to cool off. sidewalk in the hot 90 degree August sun. It was like waiting to get into a popular nightclub – new customers weren’t allowed in until the others had left. And this was not a new product launch day.
Is Apple better at engaging its customers through digital and traditional media in relation to its product releases? Let’s take a closer look at these companies’ current social media presence:
Facebook – 628,516 fans
Twitter (50+ accounts) – The iTunes account has 1,528,755 followers, is following 14, and has 692 Tweets
Apples YouTube Channel –
Channel views: 2,760,784
Total upload views: 14,444,703
Joined: June 21, 2005
Facebook – 4779 fans
Twitter – 411 followers, following 5 and has 11 Tweets
Views on the channel: 5296
Total upload views: 24,626
Joined: July 24, 2007 (two years after Apple)
Date of last visit: 10 months ago
Video taken by a manager at FAO Schwarz in NYC.
Apple appears to have a stronger social media presence, although FAO has a 150-year emotional connection with people of all ages with its focus on classic toys and historical and current film and television merchandising. FAO was also a strong brand communicator before the advent of social media marketing and film Big cemented its place in toy merchandising history. People of all ages also have a psychological connection to FAO products dating back to their childhood memories. Its PR and social media branding campaigns started much earlier than Apple’s.
Is it that the FAO brand and associated merchandise are not relevant in today’s entertainment market, or is their media agency(ies) not working outside the box to connect with its customer base? (I also understand that big box stores like Wal-Mart are undercutting FAO sales through low prices, although some of their fun products and special in-store service offerings are not the same.)
Apple and FAO (both companies that market entertainment products globally) talk about the central challenge of social media, as Faust and Householder define it, “creating social dialogue that is both engaging for customers and true to the brand’s core.”
But FAO seems to have lost that “thing” as pointed out by Faust and Householder that people inside and outside the company can relate to and know themselves. While FAO has suffered from poor management and ownership changes in recent years, this is no excuse to destroy a 150-year-old brand for lack of a good branding and marketing strategy. If money is the problem, FAO could have hired some new digital strategists to create a successful campaign that is relevant to today’s young generation.
People of all ages relate to Apple’s cool media hype, design tech releases, and media campaigns that support their products.
Also, Apple customers are willing to spend more (even in a recession) for Apple products than for similar ones made by a competitor. Is it that people today prefer to see themselves as cool, savvy and up-to-date users of social technology in tune with the latest trends and fashions?
If so, Apple’s approach runs counter to the current wisdom of some experts in the fields of product design, branding and sustainability, which says that branding is built from the inside out. Apple doesn’t always follow the latest trend, fad or customer segment, but sometimes it’s because it creates them. Perhaps Apple is the exception to the best-practice branding rule that says, “for a brand to be successful, it needs to be clear about what it is and what it stands for, and add to it.”
FAO lacks a cohesive branding, marketing and social media strategy. It is disconnected from its current and potential customers, lacks creativity in the PR buzz process, and lacks an effective social media listening strategy. I believe its products are relevant to today’s customers, but evidence of a poor marketing plan is evident in their store traffic levels and also in their Search Engine Optimization (SEO) approach.
From a marketing (SEO) perspective, FAO has 1,067 external links to its home page from other sites (Apple.com has 1,336,191), with FAO’s parent company, Toys R Us, having 6,117 external links on its home page. This means that Toys R Us is cited as a stronger authority in the eyes of Google’s search algorithms. If Toys R US can improve their SEO link strength, they can do the same for FAO. The parent company has the first page, the second position in a broad organic (free) search on Google (without enclosing the search term “toys” in quotes). FAO appears on the second page of a Google search, fourth down from the top of the page.
One strategy that Toys R US can begin to use is to spend more time on FAO’s organic SEO search power, which will provide its customers with better online store visibility. This can save money on those paid advertising (PPC) online. As for FAO’s other online competitors, as of this posting, Fisher Toys (with a front page, position 1) has 28,285 external links to its site, eToys (with a front page, position third), has 842 external links to its site and KB Toys (with the first page, fourth place position) has 42 external links to its site. (All search results were conducted using the term “toys” in the Google search.) Also, while KB Toys has fewer links pointing to its home page than FAO, it also lacks nearly the full FAO- s with Flash content, which can interfere with search engines’ ability to properly index a website. While there are other SEO strategies that I haven’t discussed, at first glance these are some of the most obvious ones.
FAO’s focus on customer loyalty and marketing its products based on its unique one-of-a-kind products are no longer enough to create a strong bond with a brand that was once the toy store to beat. Today’s consumers expect to interact with a brand and this can be achieved cost-effectively through digital and social media.
Apple’s PR (buzz), social media strategy, traditional marketing and advertising provide a very different customer experience. It launched numerous products (including the iPod that proved to be a “game changer,” pushing the company from a computer provider to an entertainment company. FAO can learn from one of the most innovative companies operating in today’s business with an ultra-loyal user base.Over the past ten years, it can be said that Apple had only one new product released, the Power Mac G4 Cube (phased out after the first year), while the jury may still be out out on Mac mini and Apple TV.
Apple has marketed itself as a company that can instantly solve your personal entertainment and business problems; their promotions relate to a basic human desire (for life to be easier) and the desire to be fun and cool even if it costs more. They also express something else important to the essence of the brand: that Apple is a quick problem solver. Often this means not only thinking about what the customer would want, but also determining what is true for the brand. Toys will always be fun. But easy is fun and authentic.
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