Part 1
iPhone has the recorded the largest number of sales in recent research about cellular devices with more than 421 million units sold until now. For the new iPhone, users will be paying $ 199, $ 299 and $ 399 for 16GB, 32GB and 64GB iPhones respectively. The iPhone has Microsoft and Samsung Note as direct competitors. The iPod, iPad and the iWatch pose as indirect competitors because they have been developed to serve almost the same purpose though produced by the same company. The iPhone product was priced from the ultimate cost of manufacture that the Apple Company incurred during production.
When the iPhone leaves the manufacturer, retail prices are regulated by the manufacturer to avoid competition between retailers. I think the iPhone manufactures have made use of the status quo price strategy. Before any company sets out to price a new product, a research is carried out in that the company goes out and gathers the view of the public on what price they think they would buy the product at. From this research, the company then settles on a fair price that they believe the public would be comfortable with and this brings about the pricing strategy of ‘status quo’. However, the status quo pricing strategy is made more effective in the different product of iPhone. For instance the 5C is considered less expensive compared to 5S and thus customers would be willing to be more for 5s than 5c this means that status quo pricing strategy had worked (Know your mobile 2014).
Part 2
Little has been known about the upcoming Apple Watch pricing and the fact is that many people have made an assumption that the new edition is a sports version which would retail at $349. (Know your mobile 2014). Samsung Galaxy has also designed a smart watch that is relatively cheaper that iWatch and because of its competitive nature, most users might settle for the Galaxy watch and not the iWatch (Apple iWatch preview 2014). The Samsung Galaxy has proven to be the largest competitor for iPhone and as Apple continues to unveil new and breathtaking products so does Samsung Galaxy.
For the pricing strategy, Apple has developed the iWatch not only for business people but rather the company has designed the watch in a way that anyone from any age group, profession and taste can use the watch efficiently. The company has used a retail strategy that is defined as MAP also known as ‘Minimum advertised price.' For this policy, the company through the help of retailers has ensured pricing policies are set to prohibit retailers from selling the watch above a certain price (7 key strategies to learn from Apple 2014). All Apple products including the iWatch comes with a limited one year warranty and 90-day technical support that makes it attractive for the public to purchase the watch. The watch is so advanced according to research that it can be quickly produced thus ensuring that the sale of the product keeps escalating.
Based off the current research I would price my product around $400.00. The reason I chose to price my product higher than the completion is my watch offers features and provides a warranty that is a step above the rest.
References;
"Apple iWatch release date, specs, features and design: Watch this space." Know Your
Mobile. Web. 22 Jan. 2014.
"Apple iWatch preview." Apple iWatch: specs, release date and price: everything we
(think we) know about Apple's elusive smartwatch Review. Web. 24 Jan. 2014
"7 Key Strategies That You Must Learn From Apple’s Marketing." What 7 Key
Strategies Must We Learn From Apple Marketing?. Web. 23 Jan. 2014.
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