iPhone ads Turbo-Charge An Already Sure-Fire Hit For Apple

If Apple has proven one thing, it is that it can compel consumers to trade into its brand through the power of design, buzz and overall brand magnetism.

The electronics juggernaut began airing its new iphone ads the last three nights, produced by TBWA/Chiat Day. The ads hail the iPhone’s arrival on June 29.

The ads, which simply show off the iphone’s interface, like the ability to use it with a finger rather than a stylus, are right on target for the launch. The agency rightly allowed the product to be the star, rather than some idea they cooked up in a dark room. I especially like the “There’s never been an iPod that could do this…” approach in the ads. Right away, Apple puts the iPhone on a plane above its most storied product. That’s smart, though, iPod sales could soon take a hit. No matter. Apple is smart to do this. How much growth could there be left in iPod sales. To be sure, many will still buy them. But launching the iPhone as a replacement for many Ipods is a smart way to keep people brand loyal.

The ad immediately demonstrates to Treo and Blackberry users what is different about the iPhone. The art direction and cinematography of the ads is super. It’s the first time I have ever seen a TV spot capture a user interface so well as a selling point.

The iphone is already a sensation. Consider that Apple’s stock price has climbed more than 30% in the last three months.

Apple’s official forecast is 10 million through 2008, or about 1 percent of the mobile phone market in just 18 months. That’s not far-fetched, and it adds several billion so revenue; not to mention the billions it has already added to Apple’s street value.

On its face, the iphone doesn’t have much that a Treo or Blackberry doesn’t have. But the ads do a good job of showcasing the more attractive and intriguing screen interface. The iphone will soon be the phone to have, especially for young people who don’t yet even have a PDA/phone. The trade-up by those buyers is going to hurt Samsung, Motorola and Nokia, I’d predict, more than it hurts Palm (Treo) or Research In Motion (Blackberry).

Lots of people who haven’t been interested in taking the Blackberry or Treo plunge will be immediately sucked into the prop-wash of the iphone. Back-to-school and Christmas will be a bonanza for Apple.

AT&T says it already has one million standing orders for the iPhone.

Before it's here, it's on the Bloomberg Terminal.