I think many people underestimate the recognition and awareness of the average consumer. Many people don't look and see "oh, this is cheaper than an iPad, it must be better", not even average consumers. People that might think that are likely to be less involved in tech stuff and may just want to get a tablet of some sort, but that's arguably not even the "average" consumer anymore.
I know a lot of "average" consumers who - despite me singing the praises of the iPad and the problems of other tablets - thought a Fire or Nook Color would be the same thing. They don't think that after owning it and then trying out an iPad, but at that point they can't return it.