The Apple iPad Air—the fifth generation of iPad has been on sold since Nov.1, whose price ($519 for basic model) is relatively high compared to other brands in the market.Customers and companyobjectives are two main factors affecting Apple’s pricing.
In term of customers factor, tracing back to Apple’s former products, Apple usually require a high price, so customers get used to it because of past experience. This is reference price. “Apple” brand is a famous and well-known brand; therefore, the Apple Company uses prestige pricing strategy which sets price in a high level.
In term of company objectives, Apple is focusing on customer orientation, adding value to purchasers and meeting market expectation. David Smith, in his article “Apple iPAD ‘5’ Air Release Date Near: 3 Reasons Its High Price Is Worth Your Money”, illustrates what Apple
did for customer orientation. The new iPad follows Apple traditional innovation, being thinner and lighter, so customers are able to use it in one hand. Second innovation is that the A7 chip is processing to new iPad. Besides great power efficiency, A7 chip is considered as “future” chip since apps are not quite ready for its 64-bit architecture. Hence, iPad Air is a long-life product. Another main innovation should be mentioned is its tablet, and all features needed to improve have been improved, including better cameras and speaker grilles. Overall, customers are able to expect a lot from iPad Air, and high quality fit in its high price.
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