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Apple’s iPhone PR Blunder

Though I'm not personally terribly upset at Apple, I called to see about getting a small refund for my "bad luck" of having bought an iPhone three days before the cutoff. I talked to a woman and her manager, both of whom told me that August 22 (the day I received my iPhone) was the cutoff date. I had purchased it on the 19th. They both told me there was "nothing" they could do, and even if they wanted to, policy prevented them.

I asked why so many others were reporting that they'd received partial or even full refunds for purchases going back as far as launch date. They couldn't speculate. I doubt every one of those people is lying - it's probably more about getting a different person on the phone.

So I called back again, just to see (listening to the speakerphone takes almost no brain cycles), and for the past hour, Apple's store line has been so jammed they literally aren't taking calls. I doubt the phones are being flooded by people calling to order new iPhones… more likely that a good portion of the 750,000 (or so) existing iPhone customers are calling back.

Steve Jobs made a big point about talking up the iPhone's record-breaking customer satisfaction numbers. My guess? A poll taken today would not give anywhere near the same results. The simple truth of the matter is this: Apple's move was unprecedented, a 33% cut in price only nine weeks after a product's release. Many Apple users are smart cookies - they buy early in a product cycle and, when a product they want to buy is eight months old, simply wait a little while for the eventual upgrade. So much for the years of experience many Apple customers have in making purchases.

Apple today finds itself in the midst of a mini-PR shitstorm. Apple is being seen as the "bad guy" today, and among some of the most loyal and vociferous of its users. I think Apple should have done something to appease the customers outside of the 14-day return policy. Maybe they could have pro-rated the refunds ($200 for within 14 days, $125 for 15-30 days, etc.). Apple could have given everyone free .Mac (or renewals) or $50 in iTunes Music Store gift certifcates. Something!

For someone who so often "gets it," Steve Jobs has simply dropped the ball here. $200 is a lot of money to a lot of people - people who are usually smart to buy early in a product's life cycle. Bigger still is the issue that it's not really about the $200 for a lot of people - it's about principles. They're simply feeling a bit "bent over" by a company they likely used to respect. That reputation as champion of the consumer that Apple's gained recently with Steve's anti-DRM letter and refusal to buckle to NBC is as good as gone now.

In the end, again, since I didn't pay full price anyway, I'm not that bummed. Despite my own opinion, I can appreciate how others who paid $599 feel a bit betrayed and wonder if Apple will do anything for these customers. I know putting something in place for 750,000 people is tough, but the window of opportunity for Apple to save some face is rapidly closing.

6 Responses to "Apple’s iPhone PR Blunder"

  1. While I agree with you that Jobs has generally stuck with being a “good guy”, I don't get why you and others (such as this http://strumpette.com/archives/555-Jobs-to-Appleheads-Drop-Dead.html) can't see that Job is like everyone else. Buy an ipod? Expect the price to drop, or better yet, new versions to come out in a few months. Early adopters pay for that role; they pay through the nose and likely watch the price go down soon thereafter. X-Box, Playstation, any new cell phone, computers, it's a running joke that that they drop. http://www.hitokiri.com/blog/archives/2007/09/i_heart_my_ipho.php has a great post on the subject. This shouldn't surprise anyone that Jobs is in it for the buck; it should be surprising that he was so dumb in how he approached and executed it.

  2. Scoble and Dave Winer are reporting that every Apple iPhone buyer is getting $100 store credit for their early purchase. Hope that eases the pain.

  3. Apparently, the Steve got such an earful that he's posted this: http://www.apple.com/hotnews/openiphoneletter/

  4. Anthony said on September 6, 2007:

    Buy an ipod? Expect the price to drop, or better yet, new versions to come out in a few months.

    You're right, except that…

    1. The price has never really dropped 33% before
    2. The price drop has never come only nine weeks after introduction.

    As I said, Apple users know not to buy a product in its eighth month, but the start of the third?

    Gordon Tyler said on September 6, 2007:

    Apparently, the Steve got such an earful that he's posted this: http://www.apple.com/hotnews/openiphoneletter/

    Indeed, and this should be a big help. Those who legally didn't deserve anything have now got it, Apple acted (rather) quickly, and much pain and suffering will go away now. 😉

  5. I don't understand how those people who complain about the early price drop fail to see the reality of this market.

    I have seen Nokia do the same thing several times with several cell phone models over here in Europe (last time it happened with the N95 whose street price dropped by over 300 EUR within 2 months). People always look at Apple and say "they have never done that before".

    Look at the product, look at the market and look what the competitors are doing. This market is much faster and a lot more aggressive than Apple's niche in the computer business and the music player market which they dominate.

    To all those who have received a refund: tell me when Nokia or Samsung does the same thing... Hint: it will never happen.


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