A closer look at Apple's smart pricing

Based on: good marketing is based on good products. Apple's product design philosophy is ahead of the times. It makes sense to study its marketing strategy on this basis. The "Anchoring" strategy for Apple's pricing (for an interesting case about the anchoring theory, see another article in this blog), differential pricing strategy, promotion pricing strategies and so on are all well-versed. A smart pricing strategy is an important aspect of successful marketing. The following is an analysis of Apple's pricing strategies from several perspectives, although some of the content is not full (I think differential pricing is only a necessary condition for generating consumer surplus, not a sufficient condition ), but it also has some reference significance. Feature.

 

The popularity of apple is in service; Apple's savvy is in marketing.

Steve Jobs is indeed a veteran of the mall who is playing with the price strategy. He takes various measures to make users feel that every product of apple is worth the money. In September 17, the iPad was officially launched in mainland China. Although the price of the iPad sold in the Chinese market is higher than that in the U.S. market, the enthusiasm in the market is not diminished at all.

By carefully analyzing the pricing of the iPad, You can see Apple's knowledge. Assume that the marginal cost of producing an iPad is constant. If Apple launches a unified market price, as shown in the left figure below, the company actually only obtains the consumer surplus in area A. What is the actual situation? Apple automatically divides the product into three versions based on the memory size classification. the domestic price of the 16G model will be 3988 yuan (about 590 US dollars ), 32G models are priced at 4788 yuan ($708), and 64g models are priced at 5588 yuan ($826 ). By grading the product, you can obtain the remaining consumers in Region B and region C. In essence, Apple implements a discriminatory pricing method that allows vendors to enjoy their prices.

Under the basic assumption of maximizing enterprise profits, of course, all enterprises prefer the discriminatory pricing method of products, enterprises can avoid the secondary strategy of "exchanging prices at the expense of the market", so as to extract more profits from different markets and gain more consumer surplus.

Here, combined with some apple practices, I try to summarize several common discriminatory pricing methods of information products.

1. Different versions are often used when new products are launched.

Like the iPad, apple always follows a multi-version approach every time it launches new hardware products. More importantly, it often maintains a Goldilocks pricing model, that is, only three versions are available at a time: High, Medium, and low. Each time, the three types of markets are separated by the proper memory size and take care of the needs of customers in different markets.

Customers who are price-sensitive will take the initiative to lower their expectations for memory size through "self-selection" and receive lower prices, customers who are not price-sensitive are willing to contribute more consumer surplus for higher memory.

2. penetration into different markets over time

This time, only WiFi-enabled iPad raided the Chinese market at a low price and sold through its own channels and specific dealers. Many people began to discuss whether the marriage between Apple and China Unicom has experienced a crisis? Will Apple's rejection lead China Unicom to fight back in the next round? In my opinion, this is just another example of Apple's smart market operation.

Before China Unicom releases a 3G version with higher-end features, it will sell WiFi-only iPad at a low price, so that those "fruit powders" who can't wait but feel shy will be the first to pay for themselves, that is to say, we can take the lead to penetrate some markets at a low price, and avoid competition between product lines of two versions. This is a strategy to deliver low-end, mid-end, and high-end products in batches in the market, it is also a common method of discriminatory pricing.

3. Change to intermediary Management Information Sharing Pricing

You can sell a product to a person with high product rating at a considerable price. But what if you meet a customer with low product rating? Let them walk away silently? Of course, Apple's answer is no.

Before Apple TV appeared, Apple sold movies and TV series through iTunes. The price of movies was $9.99. For products that require "repeated playback" of music that constantly increase their value over time, it is extremely important for customers to directly possess it, but how many people are willing to buy a film at a relatively high price?

As a result, after Apple TV was launched, it was decided to sell the film by leasing instead of selling it. As a result, the price of the film dropped by more than half, with the latest HD video. The rental price of the movie is USD 4.99, for old HD videos, the price is USD 3.99. For standard-definition videos, the price is USD 2.99. Apple will create itself as an intermediary for bulk copyright purchase, and share products with its members in a lower way, the result of shared pricing is to disturb more customers who did not evaluate the product.

4. localized Products

Prices in different regions are different. Although Apple adopts a globally unified pricing method, Apple still has its own plans for service products, especially app store. For example, for the same software, 0.99 cents in the United States is nothing, and moving to the Chinese market that "gets used to free lunch" is a bit uneconomical.

How can we ensure that the marketing strategy of "hardware" + "service" continues to be effective? Thanks to the endless power and energy of the majority of Internet users, they soon learned to crack a lot of paid software, and set up a shanzhai version of the application mall, it quickly taught more netizens who hoped to escape from prison in extremely popular languages. Apple is not in a rush to raise copyright and knowledge protection right now, and does not take any legitimate legal action, this localization marketing method, which combines hardware sales with "free" services, can also penetrate into the huge domestic market.

5. promotion pricing

If the previous methods are based on the vendor's differentiated pricing by artificially reducing product quality and features, then the sales promotion pricing is more like the vendor's Manual inconvenience to customers, truly differentiate the customer groups that are price sensitive and insensitive to the product. When selling at a price reduction, customers who are sensitive to the product price will always pay attention to the arrival of the price reduction and are willing to endure the need to buy cheap goods in a crowded environment, you can also remember to cut off the coupon and send it back to the company for a lower discount.

Apple does not seem to have done much similar promotion pricing in China, or it may be because it reduces the search cost, allowing many people to find the lowest price "no cost, so that this method temporarily loses its effect. In this case, Apple does not emphasize this method too much for the time being, but we can continue to watch and hope that everyone can work together to help supplement Apple's initiatives in this regard.