Apple brand loyalty – helping them survive and thrive in tough times?.

Well, Apple released its previous quarter report earnings recently (seen here), and some of the numbers are quite staggering, but it would be easiest to get the word right from the horses mouth:

“We are extremely pleased to report the best non-holiday quarter revenue and earnings in our history,” said Peter Oppenheimer, Apple’s CFO. “Apple’s financial condition remains very robust, with almost $29 billion in cash and marketable securities on our balance sheet. Looking ahead to the third fiscal quarter of 2009, we expect revenue in the range of about $7.7 billion to $7.9 billion and we expect diluted earnings per share in the range of about $.95 to $1.00.”

Apple’s earnings far exceeded projections, but the question is, how does a company that focuses on premium grade luxury electronics continue not only to survive but thrive in a recession?

Typically, innovative but low cost products do the best in tight economic times as are cheaper alternatives to traditional luxury goods and services; for example, movie theaters are thriving, but airlines are hurting. But really, Apple fits neither of these niches. They have breakthrough innovations occasionally, but they are typically quite expensive, and nothing recently would really contribute to skyrocketing mobile device sales, especially when much more budget alternatives exist

So, what’s the answer? Brand loyalty.

If I applaud Apple for any one thing, is that they know how to attract customers and keen them coming back. I know many people who started using Apple products back with the Apple 2 and they still cling to the Apple brand as a source of stylish, powerful, excellent quality products. But it’s really become more than the products, Apple has almost become a lifestyle choice. it was only yesterday I was driving down the road home when I saw someone with an Apple bumper sticker on the trunk of their car and I know plenty of people who will only be Apple products, even if it means paying $30+ for a pair of earbuds to match their iPod. With their long running advertising campaigns, Apple has almost indoctrinated their consumers into buying their products while imbuing an almost irrational dislike for the competition, and considering their premium price while keeping product costs fairly low, this has done well to insure Apple’s survival in the long haul.

As long as Apple continues to produce quality merchandise at fairly reasonable prices with the occasional new line, consumers will keep returning for each new iteration of releases.