I’m probably as guilty as anyone for showcasing brands that, over time, have developed a case of “innovatis” — the innovator’s complacency disease. Here are once-heralded companies that now carry a thin varnish of innovation, barely masking their true modus operandi:
Apple
The Apple innovation case study is remarkable. The company single-handedly sparked massive interest in innovation by introducing the Apple Store, iPod and iPhone during the aughts. In June 2007, when the iPhone went on sale, there were just a few hundred chief innovation officers now there are 9,700 worldwide.
As of November 2023, Apple has repurchased over $600 billion worth of its stock since the program’s March 19, 2012 inception. This is a boon for stockholders but does a disservice to the company’s legions of Mac faithful. Instead of bending over backward to please its customers, Apple continues to squeeze its buyers with sometimes outrageous pricing, like 2019’s “Cheesegrater Mac Pro” which cost as much as $50,000 fully maxed out. Then there is the $999 monitor stand, yes for a stand alone!
In June 2019, the WWDC crowd jeered when Apple announced the $999 price of the Mac Pro stand.
Apple is also notorious for ignoring customer pain points. As the saying goes, “You reap what you sow.” It should surprise no one then that Apple is one of the most sued companies in technology. “Batterygate” led to a $500 million settlement in 2020. And then there was 2016’s “Antennagate” and “Flexgate,” plus 2014’s “Bendgate.” The latest lawsuit concerns iCloud’s 5GB limit and iPhone backup restrictions, another obvious pain point.
The company continues to innovate, incrementally improving its products each year, but there have been no disruptive innovations since 2015’s Apple Watch. And the jury is still out on the $3,500 Apple Vision Pro.
In June 2023, a judge ruled that Apple engaged in “coercive” interviews and other anti-union tactics at a New York store, behavior unbecoming of a market leader that, as of Dec. 31, 2023, had $71 billion in cash and cash equivalents.
It’s quite clear that under the leadership of CEO Tim Cook, Apple has prioritized boosting profits over taking care of its customers and employees, which are critical elements of its success. It’s also ignoring logical market opportunities, like Steve Jobs’ integrated Apple TV vision, which likely contained a DVR, while wasting $10 billion on a non-core-competency Apple car project.
Domino’s
One of my favorites of the aughts, the Domino’s Pizza Tracker, captured everyone’s attention until it was exposed as a hoax.
Domino’s also has a rewards program that goes against the primary rule of design thinking: empathizing. Unlike the McDonald’s or Starbucks rewards programs, Domino’s doesn’t warn members that their bonus points are expiring. That’s not a customer experience befitting an innovator.
Domino’s Pizza Tracker made innovation waves when it was introduced in 2008. It took 12 years for it to be unmasked as a hoax.
Starbucks
Long lauded for its innovative app, electronic payment system and free Wi-Fi, Starbucks has turned into an ugly ogre, as illustrated by this story, “Inside Starbucks’ Dirty War Against Organized Labor.”
In March 2022, Howard Schultz returned as CEO, replacing Kevin Johnson, who abruptly “retired.” The illegal union-busting fight has continued under his aegis, which is amazing from a man who in 2011 created a $5 million “Create Jobs for USA Fund,” and who once ignored cheap Chinese suppliers to make coffee mugs in Ohio.
Former Starbucks CEO Howard Schultz turned to East Liverpool, OH-based American Mug and Stein Company to make coffee mugs to save jobs in America. Now, the company is fighting its employees to prevent them from making more money. Indivisible indeed.
In 2016, Schultz was famously quoted as saying, “Loyalty, technology and innovation are continuing to fuel our digital flywheel and propel our business forward.” Mr. Schultz, there may be a fly(wheel) in your ointment.
Vaporware
Everyone in Silicon Valley knows that acquiring a reputation for being incapable of shipping an innovative product, a phenomenon dubbed “vaporware,” damages a company’s street cred. Here are two of the most notable cases.
L’Oréal
I suffered no greater embarrassment for endlessly promoting the world’s largest cosmetics company, L’Oréal, for its stellar record of relentless innovation as displayed at CES for the past eight years. One has to wonder if Nicolas Hieronimus, who was appointed CEO of L’Oréal on May 1, 2021, has any idea of the company’s dismal vaporware record, as the following cogently underscores:
At the January 2017 CES show in Las Vegas, L’Oréal announced a collaboration with Whitings and Kérastase to introduce the Kérastase Hair Coach, which could report on your hair health through an accompanying app. Seven years later, the Hair Coach is still not shipping. While this was not a L’Oréal product per se, it likely made the company realize the publicity value of a CES Show.
At the January 2020 CES show in Las Vegas, L’Oréal unveiled Perso, an AI-powered at-home system that delivers personalized skincare. It’s still MIA.
At CES 2022, L’Oréal introduced Colorsonic, a home-use device that colors your hair. This would ruffle many hair coloring specialist feathers if it ever shipped. It’s now promised for mid-2024.
At CES 2023, L’Oréal introduced Brow Magic, a device that uses augmented reality to print tattoos on your brows using 2,400 tiny nozzles. As of this month, it’s not shipping.
At this year’s 2024 CES, L’Oréal introduced the AirLight Pro, which uses infrared light to dry hair up to 30% faster, using less power, and reducing heat. It remains to be seen if this will ever ship, too.
In January, Hieronimus said many remote workers have “absolutely no attachment, no passion, no creativity.” Is it ironic that my macro abbreviation for L’Oréal is LOL? 😂
Ring
To the consternation of all its early crowdfunding supporters, founder Jamie Siminoff sold Ring to Amazon for $1 billion in February 2018. That would not be the last controversial move. In 2022, the company reportedly surrendered Ring videos to police without the owners’ permission.
But it was the company’s inability to ship two highly publicized and innovative products that have drawn a lot of unwanted attention:
In Sept. 2020, Ring introduced the Ring Always Home Cam, an indoor drone that could fly anywhere in the home to check for potential disturbances when an alarm sensor was triggered. In January 2023, the company said it was still not ready for the real world. Not shipping as of today.
Launched at CES 2023, the Ring Car Cam was not designed for consumers and sales were halted in February 2024. This proves that despite Amazon’s vast resources, Ring could not adequately address the problem it was trying to solve.
According to a CB Insights survey, the top reason why startups fail at 42% was “no market need,” well ahead of “ran out of cash” at 29%. Neither of those factors apply to Ring.
Stay tuned for more updates on this breaking story.
