How RIM Can Take On the iPad

In the wake of Apple’s (NASDAQ: AAPL ) successful release of the iPad 2 tablet, Research In Motion (NASDAQ: RIMM ) will get into the game when its BlackBerry PlayBook goes on sale April 19. As promised by RIM co-CEO Jim Balsillie in November, the PlayBook will sell for “under $500,” matching the iPad 2 with its Wi-Fi-only, 16-gigabyte model at $499. Models with 32GB and 64GB of memory will be available at $599 and $699, respectively. Almost every electronics retailer in the country will carry the PlayBook, with Best Buy (NYSE: BBY ), Staples (NASDAQ: SPLS ), Office Depot (NYSE: ODP ), and Radioshack (NYSE: RSH ) on board. Even though Research In Motion has foregone 3G in the first version of the PlayBook, AT&T (NYSE: T ), Verizon (NYSE: VZ ) and Sprint (NYSE: S ) retailers will also carry the tablet. But competitive pricing and good retailer support may not be enough for RIM to break through the iPad 2 wall. In the weeks since its February release, Motorola (NYSE: MMI ) has struggled to make a powerful impact with the Google (NASDAQ: GOOG ) Android-powered Xoom tablet. What can Research in Motion do to avoid the same fate? Hit the consumers first After a year of doom-saying as Android phones and the iPhone rose, RIM closed 2010 strong with BlackBerry sales up 40%. The company’s third-quarter surge came from a 180-degree shift in its customer base. As business clients began to explore the competition, consumers discovered the BlackBerry, particularly the Curve and Torch models. RIM needs to focus on those BlackBerry users with the PlayBook, emphasizing how the tablet will compliment their smartphones while still offering unique features. For now, the company is calling PlayBook “the world’s first professional-grade tablet.” That’s not the language this device needs. Emphasize price Along with the opportunity to capitalize on the flood of new BlackBerry users that bought phones last fall, RIM also can define the PlayBook as a low-cost alternative to the iPad 2 and new competitors like Xoom. Highlighting the absence of 3G data contracts and a simple-to-understand selection of models compared to the iPad 2 will help differentiate the PlayBook even if those talking points are superficial. Transparent advertising One of Motorola’s biggest missteps with the Xoom has been its bizarre advertising campaign. No one watching television ads where a guy grabs a tablet that turns into a spaceship knows what they’re looking at. RIM needs to take a page from Apple and begin an advertising campaign that clearly explains the PlayBook’s feature set, how it’s useful as a tool at work and home, and how it can enhance a BlackBerry smartphone. No gimmicks, a clear message, and an emphasis on the device as a pragmatic purchase will give the PlayBook a fighting chance. With the above strategies, the PlayBook won’t just rehabilitate the 7-inch tablet market, it’ll help secure RIM’s place as one of the major competitors in the connected device space. As of this writing, Anthony John Agnello did not own a position in any of the stocks named here. Follow him on Twitter at  @ajohnagnello  and  become a fan of  InvestorPlace on Facebook.
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