Looks like you flunked basic business and economics 101. If you are selling all you can make and there is still additional demand, the product is underpriced.
Apple is leaving money on the table.
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How Completely Apple Has Humiliated The Cellphone Industry
- Thread starter JustinSaneV2
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Looks like you flunked basic business and economics 101. If you are selling all you can make and there is still additional demand, the product is underpriced.
Apple is leaving money on the table.
you might want to check those numbers - i'm pretty sure apple spends more money then microsoft on marketing. especially during the "get a mac campaign."
that being said, i do believe verizon spends significantly more on advertising than at&t.
consider toyota. even though the recalls weren't near a product launch, you would think their sales would be hurt. but sales have gone up for them, and there's still demand for their product.
No Microsoft's ad budget is almost twice as that of apple.. there is a link out there somewhere.
Edit : Link
http://www.businessinsider.com/chart-of-the-day-ad-spending-for-tech-companies-2010-5
It may be what your company is paying but that is not what Apple and RIM receive. The phone company is subsidizing the sale so that both Apple and RIM get more than the numbers you post. At least Apple does. RIM has been giving phones away in a two for one promotion. That has got to hurt profits.
This is what it comes down to. Apple makes a better product so they charge more for it and people are happy to pay it because they are happy with the result. Survey after survey shows iPhone customers extremely satisfied with their purchase.
The things is, profits feed R&D, and such allowing a company to keep providing a good experience for their customers. On the other hand, lack of profits drive companies to cut corners leading to unhappy experiences (failing DroidX screens perhaps?) which leads to lower sales.
Man, whats with this attitude?
Of course its a rip off. All life style products are a rip off. My iPhone is a rip off, my iMac is a rip off, my plasma TV is a rip off, as is the fancy-pants furniture and deco my wife fills the house with.
Sure I could squirrel away my cash, by a cheap Nokia and live on paper plates.
I work hard and I like spending my money on toys.
As for AT&T, gee I wonder if they wish they never had the iPhone?
How do you figure they are overpriced? Apple is making them as fast as they can, there is a 10 days or more wait for a phone. iP4 goes for about $700 on eBay. If it was overpriced then sales would plummet and in response you'd see two for one offers like you get with Blackberry.
This is how the world works. If a company can produce great value for a customer then they usually can earn a healthy premium. Apple has put together an entire package (ecosystem) of Apple stores, genius bars, Apps store, iTMS, syncing with your Mac and such that makes people happy.
You could make the argument that Apple products cost more than others, but that is different from saying they are overpriced.
It's amazing that some people think you can make more money by over-pricing an item.
If an item is over-priced, it means it is priced more than the market will bear. Sales decline and profits take a nose dive.
If an item is under-priced, sales are good, but the revenue per item is weak and profits are less than they could be. It is clear that both the iPad and the iPhone could bear a higher price, because the sales are exceeding the capacity to manufacture.
The right price is something set by the market, not the manufacturer. It is based on the value to the user not the cost of manufacture.
What Apple excel at, is taking $200 worth of components and creating a device that the market agrees is worth $600 - it is that alchemy that makes for such a profitable company.
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And that matters why?... exactly?
Apple would prefer to make money than win a numbers race.
And I bet Nokia would prefer that too.
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i wasn't talking about being 'overpriced' in market-equilibrium where-supply-meets-demand pricing ways. not the kind of 'willingness to pay' price model, if you will.
i was talking about apple making LOADS of money from a TINY market share.
3 out of 100 phones sold are apple phones
50 out of 100 dollars made go to apple
so, to avoid the misinterpreted term 'overpriced' i'll just stick with 'apple phones are damn expensive in comparison to the market average'
also, SOME (not me) consider iPhones, and generally apple products, to almost be veblen goods, so you couldn't really analyze the pricing from the basic supply/demand model.
i was talking about apple making LOADS of money from a TINY market share.
3 out of 100 phones sold are apple phones
50 out of 100 dollars made go to apple
so, to avoid the misinterpreted term 'overpriced' i'll just stick with 'apple phones are damn expensive in comparison to the market average'
also, SOME (not me) consider iPhones, and generally apple products, to almost be veblen goods, so you couldn't really analyze the pricing from the basic supply/demand model.
oh yeah, right, Nokia ...
we all know how well Nokia is currently doing...
http://www.businessweek.com/idg/201...arnings-down-40-percent-on-flat-q2-sales.html
I would suggest that what Apple are doing is right...
...it is what the rest of the industry is doing that is wrong.
Imagine you are selling 97 out of every 100 phones. How come you are making such lousy profits? What exactly are you doing to get it so wrong?
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i totally agree with you that apple is doing it right.
great business model, great marketing, great hardware, great software.
Don't get me wrong, i was among the first pre-orders of the iPhone 4 here in Austria, even got my mom to replace her broken HP laptop with a 15" MBP.
was just playing around with the numbers.
just pointing out they could be twisted to support pro and anti apple points
great business model, great marketing, great hardware, great software.
Don't get me wrong, i was among the first pre-orders of the iPhone 4 here in Austria, even got my mom to replace her broken HP laptop with a 15" MBP.
was just playing around with the numbers.
just pointing out they could be twisted to support pro and anti apple points
This is worth a read.
How to fix Nokia..
http://www.theregister.co.uk/2010/07/22/nokia_manifesto_risku/
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How to fix Nokia..
http://www.theregister.co.uk/2010/07/22/nokia_manifesto_risku/
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Yet most iPhone users do not feel ripped. People are willing to pay a premium for something that "just works" and is "magical".
strange how this can be. since android alone is almost as big as iphone atm last i read i belive that it was 43-57 or something like that.
doubt those graphs are truly correct.
and apple has humiliated themself with the iphone 4 pr buisness.
not the phone but the way that have been so arrogant, dishonest and truly patronizing. shame on you apple
oh. and btw it isnt apple that have made the iphone popular. its the developers. without them everyone would rather stick with android or whatever
doubt those graphs are truly correct.
and apple has humiliated themself with the iphone 4 pr buisness.
not the phone but the way that have been so arrogant, dishonest and truly patronizing. shame on you apple
oh. and btw it isnt apple that have made the iphone popular. its the developers. without them everyone would rather stick with android or whatever
The graphs are worldwide. Not US only. Android has much weaker performance outside the US. Also remember this is about profits and not unit sales.
Apple's "humiliation" does not seem to have changed the fact that iPhone4s are selling faster than they can make them.
I'd like to get me the same type of "humiliation".
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I think he means that developers are attracted to successful platforms. Which in turn makes the platforms more successful.
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Are you trying to be funny? The majority of phones sold in the world are still the so called "cheap dumb phones", to which really only one company makes money on them, Nokia.
They are not attracted to a successful platform, they are attracted to a better marketed platform.
Oh - it's just marketing is it?
I wonder why the other platforms don't figure this out and try some marketing too.
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While having a large number of developers adding apps to the App Store is great, I think what initially made the iPhone such a hit was that it was designed so much better than every other phone on the market, from hardware to software.
I bought my 3G because it was effortless to use and that was a revelation coming from clunky Nokias and Samsungs. The whole user experience is just better with most Apple devices and software. Back then there weren't all that many truly great apps in the App Store so what the phone did out of the box was what sold me at least.
Yes, the iPhone has the best marketing of all phones, yet by market share is trailing far behind, is this something you deny?
In terms of competing in the "punching myself in the face" competition I fear that I am also trailing far behind.
The real question is why would anyone want to win such a stupid competition?
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