SHAME: Research in Motion Falls From Home Throne
Research in Motion (NASDAQ:RIMM) is now facing customer preference for its arch rival, Apple’s (NASDAQ:AAPL) iPhone, over its own BlackBerry smartphones in its home country of Canada.
According to data from ISC and Bloomberg, last year RIM shipped 2.08 million BlackBerrys to Canada, while Apple sold 2.85 million iPhones there. It appears that Canadians’ preference for home-produced BlackBerrys may be on the wane.
Paul Taylor, a fund manager at BMO Harris Private Banking in Toronto, said “For RIM, in its home market, to lose that No. 1 position to iPhone is strategically important. It does identify, even with a home-country bias, how consumers are responding to the greater functionality of the iPhone.”
Sales have been falling worldwide, even after offsetting better sales in emerging markets. According to Alfred DuPuy of Interbrand, a research firm, “ it didn’t invest enough in promoting its devices once the iPhone arrived.
They got so good at innovation they just expected the product to sell itself – from a brand perspective, they just lost their way.”
Though RIM enjoys a price preference over Apple in cost-conscious markets like Venezuela, the Middle East, and Africa, RIM will have to be more innovative if it’s going to survive in more affluent markets. “The challenge for Mr. Heins is to take that iconic brand and products that are reasonably competitive and ensure that they do get appropriate attention from the average consumer,” Taylor said. “That’s the challenge: to reverse the negative sentiment that has developed.”
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