Day: November 17, 2013

Comment on Nicole Lam’s post: https://blogs.ubc.ca/nicolelylam/2013/11/16/hm-sells-inside-their-changing-rooms/

H&M has recently come up with a completely brand new idea in the form of “try and buy” that would allow customers to purchase the products straight from the fitting areas. In her blog post Nicole argues this new strategy that H&M is trying to implement, which is supposed to help them grow and boost their profitability, would in fact backfire on them and the opportunity cost  would lower the demand for their product and the traffic in the store would decrease.

However, I do not completely agree with her is that I do not believe this idea will backfire them, I believe that this new tactic is going to greatly benefit the company. This “try and buy” tactic means there will be more cashier in the shop which means there will be smaller queues in the store which is likely to attract new client as they see no queue therefore they will think that they won’t have to stand in line for a long time before reaching the cashier. This is likely to create a HIGHER traffic which will create a higher demand leading to higher profits.

Source: https://blogs.ubc.ca/nicolelylam/2013/11/16/hm-sells-inside-their-changing-rooms/

http://www.businessweek.com/articles/2013-11-13/h-and-ms-megastore-brings-cashiers-inside-the-dressing-rooms#r=hp-ls

Was Apple’s pricing strategy for the new iPad the most efficient one? Or was it a big error that they made?

The tablet market is a market that has been booming over the recent years and still probably has some margin for growth over the next few years. Since the beginning of the tablet times Apple has been, with its iPad, leading the market, which in general allow them to price their product. However there are more and more companies coming in the market with their tablets and stealing little bits of market share from Apple. This is why Apple’s pricing strategy is confusing: why is the price for the iPad so high compared to other brands (about twice as high) when they could make the price lower and close the market?

The reason for this is that Apple promotes itself as a premium brand, which is a brand with high quality products at high prices. Therefore all their products are priced really high, this would fail with most business but not Apple for the reason that Apple believes that its customer will always follow the bandwagon and therefore keep on buying Apple products regardless of the price. But, if the price was lower, they would kill the competition, create barriers and not lose market shares to small brands.

In conclusion I would say that i both agree and disagree that Apple made a mistake with pricing because they will always make profits but they missed out on an occasion to close off the market.

Article: http://www.businessweek.com/videos/2013-10-23/did-apple-make-a-huge-error-on-ipad-pricing