As we all probably know, whenever a new iPhone comes out, there is a very high demand for the product. Often times just days after the release, stores have run out and orders are being placed online.
Recently, when Apple came out with the iPhone 5c and the iPhone 5s, the company's plan was to satisfy the consumers who are willing to pay top price as well as the consumers who want the product but at a cheaper cost.
The 5c is made out of plastic, and therefore is cheaper than the 5s which is made the same as the iPhone 5. With this being said, Apple thought that the 5c would outsell the 5s with flying colors.
The opposite has actually happened.
Apple has "cut back 5C production by 35 percent and increased 5S production by 75 percent," which tells us that they were completely off when estimating which product would oversell.
This isn't a bad thing, at least not for Apple. But what it's saying about us as consumers is what's worrying me. If Apple sees that we are willing to pay a higher price when a lower one is available, then who's to say that they won't raise their prices altogether in the future? We are already paying top price for Apple products in comparison to others, so how far is the company willing to go?
I hope that the company does the opposite; since they see how much their product is taking over maybe they will be more lenient on the prices, but most likely they won't. I know from first hand experience that once you go Apple you never go back; so for my sake, Apple, please let's keep the prices low!
See the Article Here:
http://www.forbes.com/sites/timworstall/2013/10/20/apples-market-segmentation-difficulties-with-the-new-iphones/
I feel like Apples prices will never go down. No matter the price people are willing to pay for their products, myself included. I am surprised that the 5s outsold the 5c if the 5c was truly cheaper. I believe that people might have been scared of the quality which is why they went for the more expensive one.
ReplyDeleteI know someone who actually bought the 5c because it was about $200 cheaper than the 5s. Personally, I have an iPhone 4. It works pretty well but I will not be getting a new version of the iPhone until my contract ends and it is time for me to upgrade. I would never pay $500 plus dollars for a phone when mine is working completely fine. I don't see Apple lowering their prices anytime soon. They are smart and they know how to get the most out of their consumers. Would I like to get a new iPhone? Of course I would, but there is a difference between wanting a new iPhone and NEEDING a new iPhone.
ReplyDeleteIt's all about what consumers see as necessities and wants. If the consumers feel like they need the newest most expensive Iphone from Apple they will buy it. As long as Apple remains a necessity for some people they will continue to make products that catch consumers eye at top dollar. Whenever there is money to be made, why not make the most of it? Until consumers choose the less expensive option, this is how business will continue to work.
ReplyDeleteApple always has had a premium price for premium performance strategy, and it has worked remarkably well to make them one of the world's most respected, and most valuable, companies. Windows-based PCs have always been cheaper, which is one reason Windows has a substantially greater market share than Mac. The iPhone and iPad were the first of their kind, and gave Apple what economists call a f-rst-mover advantage: they set the standards and once people were committed to that standard they stayed with it.But Android phones (cheaper) and now Android-based tablets are catching up and, I think, even passing Apple in market share. So while Jen may wish prices would go down in the consumer interest, I think Allie is correct that they never would do that because there is no incentive for them to do so. (Sorry, Jen!)
ReplyDeleteThat should read "first-mover advantage." My fingers got ahead of my brain in the typing.
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