Steve Jobs talks marketing strategy in an internal NeXT video (1991)

Published on Jan 1, 2014
Steve Jobs recorded this first of many ‘Chalk Talk” video targeted at NeXT’s internal marketing/sales staff. HIGHLIGHTS:

01:00. Target market

07:30. Competition

08:27. Customer needs

14:11. Unique Selling Proposition vs. Sun

Location: NeXT headquarters, Redwood city

Steve was 35 years old.

 

 

 

0:00

hi, for those of you that don’t know me my name Steve Jobs

0:03

and this is the first of many chalk-talks were gonna have this year together

0:07

the subject to this one is really important which is

0:10

who is our target customer why

0:13

are they selecting our products over our competitions and what distribution

0:17

channels are we going

0:18

to use to reach these customers a lot of lightbulbs have come on over last 90 days

0:23

I had the good fortune to be with a lot of you out on the field meeting customers

0:26

getting first-hand information

0:28

as to what they’re doing with our products you feed that a lot of information

0:32

to the management of this company we’ve done a lot of thinking

0:35

and look at the data and all the sudden out of that data some very very important

0:40

things have come to light

0:41

I wanna share them with you today

0:44

we’ve had historically a very hard time figuring out exactly who are customer was

0:50

and I’d like to show you why

0:54

when we first look at the workstation marketplace

0:58

look something like this

1:07

and the biggest player as you know in the workstation market place is SUN

1:14

second biggest player is HP Apollo

1:18

third biggest player is Dec

1:20

and IBM with the RS-6000 is now in the game as well

1:24

and then outside the workstation marketplace

1:28

the very large market for PCs and

1:32

Macintosh’s the traditional personal computer market

1:35

now, we look at the workstation marketplace and he said well

1:39

we have multitasking we have great networking just like the workstations

1:44

we use UNIX we have a pretty good development environment

1:47

so we’re a lot like the folks but

1:51

then again these folks don’t really care about user interface

1:54

or at least they haven’t been able to execute on it if they do they don’t

1:58

really have great third-party application software

2:01

and these are not machines for mere mortals

2:04

so we’re not like them at all then we look at the PCs

2:07

and we do strive to get a suite of application software that allows us to

2:12

be just like these folks

2:13

we do strive to attain ease of use

2:16

and actually are easier to use than even a Macintosh today

2:20

so we’re a lot like these folks but then again we have

2:24

multitasking and networking that is an order magnitude beyond what you can do

2:28

the PC today

2:29

so over the last year we’ve oscillated back and forth

2:33

between thinking that the PCs in the Macs were our competitors and

2:37

this is what we wanted to be or the work stations were competitors in

2:41

this is where we want to be in essence are we in easier to use workstation or

2:45

are we a more powerful PC?

2:49

and had it not been

2:52

for a revelation if you will five or six months ago

2:56

are we probably would still be oscillating today and what that revelation was

2:59

was that somebody

3:00

turned up the power of our microscope

3:03

a little bit and we saw something very important and what we saw

3:07

was that the workstation market place is really not just one

3:12

workstation marketplace but two

3:21

there’s the traditional half which is what we come to know and love science

3:24

and engineering

3:26

which does indeed look just like this

3:28

but there’s a new half emerging which

3:32

we’re calling the professional half that is

3:36

professionals that are not scientists and engineers

3:40

who want the power of workstations and inside this marketplace

3:45

there are several submarkets

3:48

publishing the high end of the publishing market, tech pops

3:52

medical

3:56

a lot of database driven applications

4:01

higher education

4:02

etc, etc, etc legal markets in here

4:05

many many markets are in here and

4:09

what’s very interesting is Sun is the only company

4:12

that seems to have eked out a beach head over here

4:16

and our data says that in

4:20

1990 Sun sold around 40,000 computers into this market

4:25

and had about an eighty percent market share so the entire professional

4:28

workstation market

4:30

in nineteen ninety was about 50,000 units

4:37

and Sun had a majority share

4:39

that’s why we didn’t see it before it was such a small blip

4:42

compared to the workstation marketplace or of course the PC marketplace

4:46

they did not show up on our radar screen but we’ve seen it now

4:50

and it’s good that we have because this is a marketplace that we can dominate

4:54

and it’s a marketplace is going to be very large the market research data that

4:58

we have

4:58

and also our gut feelings from many many years in the industry

5:02

say that this marketplace in ninety-one is gonna grow

5:06

to about a hundred thousand units inside its gonna double

5:09

this year and next year in ninety two it’s going to triple

5:13

to about 300,000 units that is a substantial marketplace

5:19

what is also exciting about this marketplace

5:22

is that a hundred percent of our volume goes in here an other words if we could

5:27

ship fifty thousand computers

5:29

into all these markets this year we would have a fifty percent marketshare

5:34

of one of the fastest growing segment in the entire computer industry

5:37

now let’s examine why this thing is gonna grow

5:41

what is gonna cause this thing to grow from fifty to a hundred thousand to

5:44

three hundred thousand units

5:45

clearly it is not these people deciding to

5:49

not to stop being engineers and go to business school and reemerge over here

5:53

that’s not how it’s gonna grow

5:54

its gonna grow from two factors number one these folks moving in

5:58

PCs and Mac owners deciding that they need more sophisticated networking

6:03

more sophisticated development environments, etc deciding they need

6:07

to step up to workstations

6:09

and one other class of users there’s a lot of people now

6:12

using 3270 terminals or terminal emulators

6:15

hooked up to a mainframe for database driven applications more and more

6:21

they are deciding to move their applications onto a powerful desktop

6:26

workstation

6:27

connected via networking to the mainframe so that they can get the

6:30

application at a mainframe in onto the desktop

6:33

for more rapid development for better user interface

6:36

and for better economics so these two factors are what’s going to cause this

6:42

market

6:42

to increase almost in order of magnitude in size

6:46

over the next twenty-four months and we can get

6:49

half of it now one of the things

6:54

that is very interesting is that

6:57

Sun is today the major

7:01

participant in this marketplace with eighty percent market share

7:04

and I personally

7:08

don’t see too many other people being able to move into this marketplace over

7:12

the next few years I believe Sun will remain

7:14

our major competitor the funny thing is

7:18

while were convincing these people

7:21

using PCs and Macs and these people using 3270 terminals or equivalent

7:26

to move in to the professional workstation segment

7:29

Sun is if you will our friend because they’re gonna spend their marketing money

7:34

to convince people to move into this segment but the minute they’ve made

7:38

their choice to move into the segment whether we convince them or Sun is

7:41

convinced them

7:42

Sun and NeXT are mortal enemies

7:45

and the good news which will talk about a minute

7:49

is that we’ve had a chance to suit up against Sun

7:52

with our new products about 15 times in the last 90 days

7:56

and we’ve won 15 out of fifteen

8:01

now we want to address what is compelling these people to move in to

8:05

this new

8:06

category of professional workstations and

8:09

secondly once they decided to make the move into the category

8:12

why are we gonna beat Sun let’s take a look there’s three primary reasons

8:17

the first one is that every single

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