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Home / Hawkes Bay Today

Caroline Ritchie: Amazon ready to Fire

By CAROLINE RITCHIE
Hawkes Bay Today·
3 Oct, 2011 07:34 PM3 mins to read

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It is no coincidence that the near stratospheric growth of Apple is related to mobile computing devices.

If you missed one of society's largest shifts in social fabric - the rise of the smartphone and tablet computer - it's time to wake up.

The psychological pull of these devices and the extent of the accompanying brand loyalty is so strong that quantifying it is difficult.

People buy these things whether they can afford them or not.

Their owners personify them as if they were living companions. This powerful longing for the best digital experience comes from two sources: literally wanting the highest quality product, whether your budget stretches to it or not, and lusting after the cool device that all your friends have. If you think the second aspect is trivial, think again, it is Apple's trump card, second only to an exceptional delivery on functionality. The company has won out against weaker rivals, despite serious repeat attempts, by over-delivering on expectations.

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Enter the Kindle Fire.

The billionaire founder of Amazon, Jeff Bezos, has just launched a new tablet. What, you say, another $1000 pretender to the throne? After all, many have knocked at the gates of tablet computer prosperity only to turn around empty handed. Touchpad, Xoom, Playbook.

As for the Amazon Kindle Fire, well, we shall have to wait and see.

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At half the price of an iPad, with supposedly near identical technology, you might have to wonder.

And, crikey, look at the distribution power of Amazon. Bezos certainly has the pitch right and he is absolutely not suffering from marketing myopia.

The Kindle Fire is being levelled as a gold standard new generation service rather than a piece of hardware.

Any marketing man's holy grail is to succeed with a physical product that delivers an emotional and cultural experience.

The only thing that beats that is a virtual product that tugs the same heartstrings. Like Facebook.

"A premium product without the premium pricetag," is how Amazon is positioning the Fire. Amazon and its founding man are described as "hyper-competitive" - driving, hounding, pressuring and ultimately beating down those who stand against them.

The Kindle Fire, released in literally a blaze of Steve Job-esque copy-speak, has certainly got some attention.

The company has waited long enough to watch the mistakes of others. And they have stated they will sell the device for virtually cost price. But crucial elements for some audiences are missing.

No camera, only WiFi, no 3G, no microphone.

Amazon are really going on a lion hunt with this one but I'm not scared.

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Competition is the very premise of a free and prosperous market - but some prey is mighty hard to catch.

Caroline Ritchie is an authorised financial adviser with Forsyth Barr in Napier. She can be contacted on 0800 367 227 or caroline.ritchie@forsythbarr.co.nz.

Her disclosure statement is available on request and free of charge. This column is general in nature and should not be regarded as personalised investment advice.

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