The Importance of Evolving Product Design: A Case Study of BlackBerry’s Rise and Fall
Technology switches the market landscape drastically. It creates and destroys multi-million dollar companies. Blackberry went from 20% of the global mobile market share to almost 0, making it discontinue its master product. This case study shows the rise and fall of Blackberry mobiles.
The Origin of Blackberry
In 1984, two Canadian engineering students, Mike Lazaridis, and Douglas Fraggin, formed Research In Motion. They started working on wireless motion technology. The company dabbled in random projects like LED systems for GM and a local network for IBM.
In 1989, the Canadian phone company Rogers contracted RIM to work on its mobile text network, a system specifically designed for messaging. This gave RIM a leg up as an early expert in mobile messaging.
In 1996, RIM introduced its first two-way messaging pager. One of the first products to carry the ‘Blackberry’ name was one of the first pagers with a full QWERTY keyboard, which later came to define the brand. The name Blackberry comes from the shape and feel of the keys on their keyboard.
The pager’s main feature was its ability to integrate with email. This device gave business people easy-to-use, on-to-go access to email, leading to Blackberry’s huge success among business people.
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The boost is the Blackberry's success
Blackberry understood the market and focused on minor details. Blackberry understood that the bandwidth in the 1990s was limited. Mike Lazaridis understood this limitation and created an instrument within Blackberry that distributed the bits of data communication in such a way that it would not overload the networks. While the competitors charged a massive amount of money for a device that barely worked over a network, Blackberry devices were affordable, and they just worked. Blackberry devices were released with a QWERTY keyboard used for typing long-form notes.
Blackberry’s marketing
Blackberry also followed an effective unconventional and low-cost marketing strategy. These aimed to generate interest in BlackBerry devices among target audiences, particularly business professionals and tech-savvy consumers.
One of the marketing was the “Blackberry Thumb” campaign. To promote the QWERTY keyboard feature, BlackBerry launched a campaign highlighting the strain that heavy use of the keyboard could put on users’ thumbs. The campaign used humor to draw attention to BlackBerry’s keyboard and emphasized its durability and reliability.
Another marketing was guerilla marketing; Blackberry’s employees would go to conferences to spot business people using large, chunky laptops. The employees would give the Blackberry device to try for free for a month. This created massive word-of-mouth marketing among business people, which later made the device a necessity.
The hype of the Blackberry carried to non-business users. Blackberry identified that other general people used to buy the devices and decided to target them. Blackberry integrated more features for an everyday user; the ‘Blackberry Pearl’ stepped into the market by targeting a non-business user. The device featured various multimedia elements, and also came with a new feature called ‘Blackberry Messenger (BBM)’.
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Blackberry devices were revolutionary, and found everywhere. At its peak, the company had 20% of the global mobile smartphone market and over 50% of the United States market.
It was a giant in the tech world, its users ranged from the youth to old professionals, and the company’s position was so strong in the market. But how the hell it went wrong?
2007 — The release of the iPhone
The year was 2007; the tech industry was revolutionizing. Steve Jobs made a presentation about his new product; it was a smartphone. Jobs termed it as Phone + email + Internet, an all-in-one device. Meanwhile, in Canada, the founder of Blackberry, Mike Lazaridis, looked at the announcement and said,
“This is an impossibility with the networks wouldn’t be able to carry this. It is illogical that anyone would even propose this.”
Mike was right; the iPhone drop caused Apple to face lawsuits for a product that simply didn’t work properly. But after the initial setbacks, the iPhone began to work. Within two year period, iPhone started to take the world. It's interactive features and multi-touch screen made the device more famous. In addition, Android devices like HTC also started to hit the market, thereby increasing competition.
This situation was new for Blackberry; previously they didn’t have many strong competitors. There was Sony Ericson, Nokia, and Motorola, But Blackberry was a premium mobile phone brand. But this changed over a small period. An iPhone did many things better than a Blackberry; a bigger screen, interactive capacitive touch, better multimedia player, also a browser that differentiated the product.
Blackberry had a small screen layout limiting the capacity to render images, and the entire layout was relatively small compared to the iPhone.
The expansion/fightback
After all the strong competitors, Blackberry managed to expand and stay in the market. They were expanding in Indonesia, India, and other small parts of the world. To manage the demand, they even built factories in some nations.
Once the iPhone got its network problem solved, Blackberry reacted. The next Blackberry phone was released with a bigger screen size, while still making the QWERTY keyboard a bit famous this time, by manufacturing it in a slide-down tab.
The core issue of Blackberry was, trying to compete in the dynamic market by changing its physical features while its Operating System remained the same. Blackberry soon realized its problem and reacted by changing its OS, which was built by using QNX (Unix-like). Unfortunately, developers at Blackberry didn’t like the usage of QNX. Instead, they opted for companies that made apps for Android and Apple because they could gain more exposure to a bigger market. Only a few developers were working at Blackberry. They had few people to sell their devices with fewer apps, which in turn made the developers produce fewer apps for Blackberry devices, thereby creating a destructive loop.
Over this period, Blackberry dropped from the most popular mobile brand to the third position. Blackberry jumped to Android OS, but this turn made Blackberry not make no difference among competitors, they failed to bring innovation. They held no edge in this newly developing dynamic market. This made Blackberry pivot to a Software company, focusing on the security part of enterprise software. Blackberry still does phones, but it only accounts for 0.05% of the global smartphone market.
The Aftermath
Today, Blackberry specializes in providing secure communication software and services to large organizations, including governments and businesses. They offer solutions such as endpoint security, secure communication, and collaboration tools for remote teams. Blackberry has also ventured into the automotive industry by providing software for connected cars and autonomous vehicles.
The growth of Android and Apple killed Blackberry. Blackberry was at the top, but the problem crept into the models of their devices. Blackberry failed to develop new features or technology related to its product. They kept producing the same model over and over with tiny improvements, but not any big leaps seen in Apple and Android devices.
Blackberry pushed their products to the consumers, instead of actually listening to them.
The mistakes they made,
- Failed to realize that non-business consumers would drive the market.
- Poor reaction to the new app economy that made Apple and Android devices become popular.
- Didn’t foresee the mobile phone market would evolve from a simple communication device to a full-mobile experience entertainment device.
- The executives remained on the QWERTY keyboard in the phase of touch screen devices.
Conclusion
If Blackberry had recognized the potential of touch features in smartphones and altered their design by eliminating the physical keyboards, they could have capitalized on the trend and gained a competitive edge in the market, given the widespread popularity of touch-based devices such as the iPhone and Android devices.
