FridayFive: The iPhone Is Too Expensive
You know, and I know, that the iPhone defies the marketing conditions of Mobile Phones. A massively competitive industry, pushing technological advances whilst driving prices down to the bone. And yet, Apple walked in, offered a phone with average specifications, at a price most people cannot justifiably afford, and took a good share of the market.
How did they do that?
Here are 5 key reasons to ponder upon…
- DESIRE – Apple products are highly desirable to it’s target market. Beautiful even. Fashion phones come and go. But Apple is more than fashion…
- BRANDING – Apple products personify ‘the better choice’. The wiser choice. The Apple logo suggests simplicity, clarity and honesty.
- LUXURY – Luxury products don’t compete. A luxury product is more than it’s constituent parts. The price itself creates it’s exclusivity and worth.
- MAGIC - ‘Any sufficiently advanced technology is indistinguishable from magic’ – A.C.Clarke. Apple products are actually technically average. But every Apple product seems to offer something new and just that little bit special The simple feature that switches the screen view from portrait to landscape when you turn the phone around, is everything. That is so important because it is clearly demonstratable.
- ANTICIPATION - Apple have become masters of secracy. Combine that with a hugh number of fanatical fans, and there is a potent cocktail. The iPad was hotly anticipated, and the speculation became so frantic that when the iPad actually launched it could have been a granite slab with an Apple logo on it. It still would have sold out. (Incidently, surprisingly few consumers realise that running out of stock on launch day is just another marketing trick. Scarcity works incredibly well, especially in luxury markets, use it to your advantage.).
You may think it is unwise to compete in a crowded marketing. But a crowded market is clear evidence that there’s a huge need or want. The niches that are often under-served in such market conditions are the luxury niches.
Whilst the dogs are all fighting for the floor scraps, the cat is eating the chicken in the parlour.
(that’s a terrible metaphor, sorry!).
And, as is clearly demonstrated by Apple, luxury often has mass appeal. Even with an economic downturn, we have seen many luxury products continue to sell well. Eck, if your iPhone wasn’t expensive enough, you can even get it gold plated (now that’s great business idea – simple, exclusive, high profit).