How does Apple price what it sells? Usually at the high end of the spectrum. Macs are more expensive than average PCs, iPhones and iPads are more expensive than most smartphones and tablets. Does Apple ever discount products, or change product names? Yes. Here’s how.
Discounts By Proxy
First of all, allow me to point out the not-quite-so-obvious discount trick that Apple uses. To move product from its own shelves, Apple refurbishes and bundles to avoid an outright discount.
How does one explain Costco and Walmart’s big discounts on iPhones and iPads? That’s a no brainer. Apple has plenty of inventory and allows discounters some room on pricing.
Doesn’t discounting damage the brand? Perhaps, but no one seems to mind, and Apple remains the premium brand regardless of who does the selling or who discounts the price.
Apple’s products have the industry’s highest margins so the company has more room to discount to remain competitive and move inventory before new products arrive. That explains the recent round of product pricing.
That also brings up an interesting sidebar as multiple iPhones wait in the wings for launch later this year. Instead of a couple of iPhones with similar parts and priced $100 apart, Apple likely will introduce two more models, both with larger screens, and perhaps different hardware. Guess what? The pricing spread will be even greater, but likely upwards.
Names By Proxy
Apple seems married to the iDevice and iEverything naming convention, but there’s precedent for big name changes. OS X went from Mountain Lion to Mavericks and now to Yosemite. iPhone 5s and iPhone 5c differentiate the high and low end of iPhoneland. Ditto for iPad mini vs. iPad Air.
What happens to the naming scheme when the iPhone 6 comes in three different sizes? Yes, there will be an iPhone 6 with the current 4-inch display size. Apple would be crazy to eliminate that in favor of a 4.7-inch iPhone, which probably will cost $100 less than the Cupertino Phablet iPhone at 5.5-inches.
How will Apple differentiate three different iPhone models by name? An aluminum bodied 4-inch iPhone 6 can’t be iPhone 6c because ‘c’ already means ‘plastic’ in the eyes of customers. This is a marketing conundrum for Apple. Here’s what I like.
iPhone 6 mini or nano for the 4-inch model. Plain old vanilla iPhone 6 for the mid-range 4-inch model, and iPhone max for the gargantuan 5.5-inch model. If not ‘max’ then what? iPhone Air? Not bad if it’s the lightest of the largest smartphones.