PRICE RANGE OF PRODUCTS

PRICE RANGE OF PRODUCTS

Above is the price range of all Apple products between the years of 1975 to the present. Steve Jobs manufactured products that were not just far advanced than other products in the same category, but they were also out of reach for most consumers. When Apple Computer launches its Apple II in 1977, it cost $1,298 and if you wanted a more powerful version it would cost you twice that amount. In 1984, Apple Computer released the Macintosh at a price of $2,495. At these prices, many consumers could not afford to own a Macintosh. Upon Steve Jobs return to Apple Computer in 1984, Apple products price drop allowing most price-conscious consumers to own a Macintosh. The new iMac carries a price of $1,300 which would cost $1800 in today’s current dollar value. As technology advance, the price of Apple Computer products continued to decline. Since 1996, Apple had released the MacBook Air for $900 and MacMini for $600. Apple now offers products in addition to Macintosh products. These products have been very profitable for Apple Computer.

The products below are sold on the Apple store online: Computer technology has enabled manufacturers to build cheaper, higher-quality, and more powerful computers that are also more accessible and affordable to the average consumer. For example, the iPad 2 has been compared to the 1980’s Cray supercomputer, but at a price that millions of people can afford. Steve Jobs realized that technology had advanced to a point that he could now make products that could not just deliver high quality but also be “price accessible to the broad non-geek middle classes. He could not make his “NeXT workstation which was value at $6500 in 1990, or $11,267 in 2011 “which was placed on many workstations across the world” at a price that many not only be affordable but hard for competitors to match. For example, the iPad 2 price is $499 and the iPhone 4s is priced at $199, both sold at a competitive price that is hard for competitors to match and within the price range of most consumers.

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PRICING OBJECTIVE S OF BRAND

According to Steve Jobs, "Apple is breaking the rules in terms of its pricing model," he told Reuters by telephone. "It's doing what luxury brands do, where the higher price the brand is, the more it seems to underpin and reinforce the desire. " "Obviously, it has to be allied to great products and a great experience, and Apple has nurtured that. "After all Apple is a luxury brand that demands a premium price and Apple customers do are not looking to save money but to get the highest quality product in the market.

This adds up to three main factors that help Apple keep the iPad and other Apple products price so low:

1. Apple stores - Apple makes a large chunk of its iPad sales directly to its customers through the Apple retail stores and the online Apple Store, which enables the company to keep even more of the profits. While running retail stores is expensive, Apple runs one of the most profitable retail businesses in the US and these direct sales give Apple the ability to directly follow up with customers to entice them with future upgrades.
2. Supply chain - As others have explained, Apple has a major supply chain management advantage. That means that it controls the components that go into its product (and the price it pays for them) better than its rivals do. Apple makes the software, designs the chips, and buys flash memory and LCD displays in huge quantities (in combination with iPhones and iPods). That significantly whittles down the raw cost of each iPad.
3. The 3% factor - Apple sells the iPad to retail partners at a minimal 3% discount (which is likely much lower than competitors). Because of the strength of Apple’s brand and the customer demand of the iPad, retailers are willing to take very little profit on iPad sales in order to drive store traffic and make money on add-on purchases like accessories and extended warranties. Apple has been so successful by opening its own stores which have made a huge impact on iPad, when iPad2 was released CEO Steve Jobs said: “One of the things that enabled us to roll out this technology so fast was our Apple retail stores. They were built for moments like this.

Reference

1. http://www.studentbuyingguide.com/2010/04/apple-ipad-student-discount/Andrew. (2011, September 16).
2. http://www.studentbuyingguide.com/2011/09/last-weekend-for-apple-back-to-school-2011-100-gift-cardpromotion/ David Cowell. (2012, April 17).
3. http://www.huffingtonpost.com/2011/05/09/apple-google-most-valuable-brand_n_859265.html (2011, June 06).
4. http://blogs.reuters.com/felix-salmon/2011/10/06/chart-of-the-day-apple-price-edition/ Jason Hiner. (2011, March 11).

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