Apple's Price Skimming Strategies

By making their products differentiated from the competition, Apple can establish their own price. Apple believes that people will pay some more money if they know that what they are buying is better and more reliable. That is also the reason why Apple sells the same products all over the world, making no selection or differentiation depending on where the market takes place. The high costs of Apple’s products are the one of the reasons why Apple Inc. preferred to be

New top-end mobile phones such as the Apple Iphone are allowing a new class of mobile to emerge in the world today. Combined with its ease of use, rich design, and well-organized application system through Apple App Store makes the Iphone an appealing platform for development of other smartphones. The Apple IPhone was released on June 29, 2007 by CEO of Apple Steve Jobs (Honan). The IPhone offers many of the innovative features found on competing devices, but it also differs from other smartphones on the market.

Technology change has naturally been a major factor in Apple's success. The company played a major role in the shift to a mobile computing society, by developing the personal technology devices that would

Apple and Samsung are the two greatest organizations with an industry of the greater part the worldwide cell phone advertise. Consistently, both Apple and Samsung are getting new developments their mobiles, which extraordinarily expands their cell phone deals. Since there is though competition in the present world, Apple created a trend by introducing IPhone to the world, which is one of the best feature smartphone with high security. According to Business Insider, “Though apple is getting more profits and experiencing the first place in the market, then came the competitor Samsung, Samsung introduced the Galaxy S smartphone which made the apple market

Over the last decade, electronic-based companies such as Samsung and Apple have collaborated with cellular-phone carriers, and have studied the average consumer to find endless ways to improve the cellular phone. As a result, the smart phone was born. With their ability to provide users with instant access to communication, entertainment, Internet access, calendar, news, social media, and much more, the smart phone revolutionized and shifted the path of modern technology. In 2006, Apple began this revolution with their release of the iPhone. Being the first proper smart phone, many other companies attempted to mimic the unbeatable features and technology that Apple had included with the iPhone.

Apple came back from near extinction to become one of the most revered technology companies in recent memory. They achieved this status by developing innovative design products and pushing the limits of their marketing prowess. Apple is known for their ability to listen to consumers and revolutionize market segments by providing modern design laden and feature rich alternatives to the target markets. They employ strategies that might contradict normal convention by keeping their prices high to build a brand image of prestige and promote their products through word of mouth. The impact on marketing is hugely noticeable by other companies following suit with store models

On June 29, 2007, Apple Inc. launched sales of the iPhone at Apple and AT&T stores across the country. Many hours earlier, enthusiastic customers lined up outside stores to get the first iPhone in their hands. The iPhone is more than just a breakthrough mobile-phone device. It is a strategy that may expand Apple's sphere of influence. Apple elegantly combined a mobile phone, mp3 player, and personal digital assistant (PDA) on the same machine characterized by its unique, innovative design.

Jobs also changed the pricing strategy and focused on value-based pricing that provided customers with premium products at a premium price. Product pricing has specifically set Apple apart from its competitors. Apple believed that they could create demand for their products which would give the company “power over prices through product differentiation, innovative advertising, ensured brand loyalty, and hype around the launch of new products” (Nair, 2014).

Once again Apple has been the first to the market when it comes to new features such as the touch screen, which has helped to keep its competition at arms length. Like all other Apple products, the smartphone is seen by many consumers in the industry as fashionable and a must have. Also Apple’s online music store support has also been a huge lift to its smartphones, as consumers can download music and thousands of applications.

Nowadays, Apple has positioned itself to be an innovator in the personal computer industry and Apple has developed by offering modern products compared to its competitors. According to Apple’s mission statement last year, “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.” (Business Management,

Diversity in products and their prices helps Apple remain an inelastic company, regarding their demand. If a price rises for one of their products, there is sure to be another product that moves into that previous product’s price range that is still comparable in design and quality. There will always be people to buy the more expensive items not only because of Apple’s positive brand recognition and loyalty, but because Apple consistently produces quality and innovative products; including, if Apple finds a defect or fault, they fix the problem for free or replace the product altogether.

Apple has always been something of a trendsetter in the tech space. Its product history since Steve Jobs’s return in 1997 gives us a solid list of examples to choose from, from its very first iPod, to Apple’s PowerBook (and later MacBook) lines, to the iPhone and the iPad. Apple’s history is dominated by products that existed before Apple had a crack at them - but it was Apple who simplified them, made them appealing on a much wider scale, and ultimately made them objects of desire for the masses.

In 2007, Jobs invented the iPhone, a user friendly smart phone, which launched the smart phone market as we know it today. Until the emergences of other companies in the smart phone industry Apple monopolized the smart phone market. Although, other competitors are producing smart phones, Apple still continues to be successful when it comes to sales. For instance, Apple’s new iPhone 5S models sold more than 9 million units in their first weekend, and the company has earned praise for

Apple operates with fierce competition in the consumer electronics segment which comes in many different forms. There are a large number of competitors in the different market niches who offer many similar products. Furthermore, many of these competitors' products are priced much less than an Apple branded products. Just as soon as Apple releases a new product, major companies begin imitating it immediately. In the personal computer industry, market pressure is continuously being exerted from such companies such as IBM, Dell, HP, and Toshiba (Wildstrom, 2009). Furthermore, with its flagship product the IPhone, Apple competes with companies like HTC, Palm, Blackberry, and Motorola (Wortham, 2011). Apple has had significant success despite the competitive environment because Apple commands a brand loyalty and dedication to innovation that few companies have ever achieved.

After a half circle of product life cycle Apple refreshes its offer with new features and decreases the price of the previous offer. Thus the market skimming has become the strategy and thus practicing market leadership in product-quality will cover the high cost and R&D. Thus the each year apple enthusiasts are getting the higher value of high quality and advanced features in the closely same price which actually comprises everyday less-price as well.