Apple Price Strategy
Chapter 2: Analysis of marketing strategy
2.2 Pricing Strategy
2.2.1 Factor affecting pricing decisions (type of market) iPhone4s is a product from Apple which sells in oligopoly competition market. As we know, the characteristic for oligopoly competition market are product differentiation, few sellers but many buyers in the market, high barrier market entry and exit, price maker in the market and spend money in advertisement.
It has a few of competitors, such as Samsung Galaxy S2 (RM2099), HTC One X (RM2099), Motorola Rarz (RM1999), Sony Xperia S (RM1899) and Nokia Lumia 900 (RM1799). To enter oligopoly market, it has a high barrier. Therefore, Apple is the price maker. Their products are inelastic which means that the products price change would not make a big difference in the quantity demanded as customers will still buy the iPhone4S because of its superior value, benefits and features it provided to the customers.
Apple Smartphone always has more function than its competitor. For example, iPhone4s have unique function for their own brand which is Siri Voice Assistant, the voice-activated personal assistant exclusive that other company phone does not have it. Samsung Galaxy S2 has excellent keyboard dictation software, but its do not have the same system-level integration Siri does. With Samsung Galaxy S2, you will need apps like Vlingo or Jeannie to help you with answering questions but they are still not half as good as Siri. Apple used their unique function to attract their customers .Apple are using value-added pricing strategy to attract customers instead of cutting price.
Product differentiation is a process of creating real or apparent differences between goods and services and a differentiated product has close but not perfect substitute. For example, the substitutes of our chosen product are Samsung Company’s product which is Samsung Galaxy S2. There are a lot buyers and sellers in the current market. They are also known as price maker in the
2.2 Pricing Strategy
2.2.1 Factor affecting pricing decisions (type of market) iPhone4s is a product from Apple which sells in oligopoly competition market. As we know, the characteristic for oligopoly competition market are product differentiation, few sellers but many buyers in the market, high barrier market entry and exit, price maker in the market and spend money in advertisement.
It has a few of competitors, such as Samsung Galaxy S2 (RM2099), HTC One X (RM2099), Motorola Rarz (RM1999), Sony Xperia S (RM1899) and Nokia Lumia 900 (RM1799). To enter oligopoly market, it has a high barrier. Therefore, Apple is the price maker. Their products are inelastic which means that the products price change would not make a big difference in the quantity demanded as customers will still buy the iPhone4S because of its superior value, benefits and features it provided to the customers.
Apple Smartphone always has more function than its competitor. For example, iPhone4s have unique function for their own brand which is Siri Voice Assistant, the voice-activated personal assistant exclusive that other company phone does not have it. Samsung Galaxy S2 has excellent keyboard dictation software, but its do not have the same system-level integration Siri does. With Samsung Galaxy S2, you will need apps like Vlingo or Jeannie to help you with answering questions but they are still not half as good as Siri. Apple used their unique function to attract their customers .Apple are using value-added pricing strategy to attract customers instead of cutting price.
Product differentiation is a process of creating real or apparent differences between goods and services and a differentiated product has close but not perfect substitute. For example, the substitutes of our chosen product are Samsung Company’s product which is Samsung Galaxy S2. There are a lot buyers and sellers in the current market. They are also known as price maker in the