Apple has one of the most well-established cult followings of any company in any industry. There are lines out the door every time they release a new iPhone despite major price increases and mild technical advances. Brand loyalty is so strong among Apple customers, I have heard people say they want an iPhone over an Android simply because they "don't want any green text in a group chat."
As of Friday, it seems the tech giant will be gaining a new group cult followers, but not because of a new phone or new technology. On Friday, Apple released a statement to let us know they have made a deal with world-famous surprise gift giver and queen of middle-aged women everywhere, Oprah Winfrey.
"Together, Winfrey and Apple will create original programs that embrace her incomparable ability to connect with audiences around the world," Apple said in a statement Friday.
Apple signed the media mogul as they attempt to give life to a new streaming service, and this is a move in the right direction. Just as Christian rock bands begin with an established audience of Jesus-lovers, Oprah automatically brings in her fanatical fan base. Her fan base is so fanatical that any product Oprah touches sees a massive increase in sales. So much so that the sales increase after a Winfrey endorsement is called 'The Oprah Effect'.
With over two million affiliates, Oprah's Book Club has a far-reaching influence on its members and the overall community of readers. Authors such as James Frey, who wrote the controversial "A Million Little Pieces," (2005) see overnight fame and fortune after their works climb the Bestseller's lists upon being endorsed by the club. Jacquelyn Mitchard's "The Deep End of the Ocean" (1999) remained on the best seller list for 71 weeks, largely because of Oprah's recommendation.
It is not only books, but also book-related products that gained immediate public acceptance. After Winfrey passively announced during one of her interviews that she owns a LightWedge book light, the company saw daily sales increase from $3,700 to $90,000 in one afternoon. Likewise, after endorsing Amazon's Kindle, the product was sold out in a couple of hours.
Food products such as Galaxy Desserts and Marie Belle Hot Chocolate saw a huge surge in demand after being featured on Oprah's Favorite Things. Galaxy experienced a 1,000% growth in sales and Marie Belle increased its annual revenue from $1 million to $5 million. These two items are merely a sample from a very comprehensive list of goodies.
Most recently, we've seen 'The Oprah Effect' manifest itself in her partnership with Weight Watchers
On-balance volume (OBV) broke out to a new high after Oprah reported her stake and has drawn a long series of new highs since that time. This signals outstanding institutional sponsorship as well as healthy speculative fervor.
Apple already has the largest Market Cap of any company on the market at roughly $928 billion, and the acquisition of Oprah will give them a chance to expand their market by challenging streaming companies like Netflix and Hulu. And with Oprah on their side, this challenge will be a serious one.
Oprah's Weight Watchers Stake Worth Half a Billion [Investopedia]
Measuring The "Oprah Effect" [Investopedia]
Apple announces multi-year partnership with Oprah Winfrey [Apple Newsroom]