This is a response to Amaury Dorin’s post: https://blogs.ubc.ca/amaurydb/2013/11/17/is-apple-going-mad-or-to-the-contrary-being-brilliant/

Apple Inc. is probably one of the most known multinational corporations on the globe and with its increasing popularity it never fails to prevail. After being intrigued by reading Amaury’s blog post about how Apple’s iPad pricing policies have affected them, it struck me that, to some extent I agree with what he has to say.

Almost all of the products that Apple Inc.’s. has ever innovated or produced have been priced at a ‘premium’ price. Apple can afford to charge premium prices, but only because of it’s well established customer loyalty and well repudiated brand image. Their customers know how distinctive and differentiated their products are, compared to its competitors and thus are more than willing to pay higher prices. In addition, Apple also needs to cover its Research and Development costs as well as any other costs they might have incurred during the development of the product.

Amaury correctly highlights how Apple is able to charge a premium price for its products such as the iPad due to its brand image. However I don’t believe they made an error, as if they would have charged lower prices, their customers would have ‘physiologically’ thought that since it was ‘cheaper’ it wouldn’t be of high quality.

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

Post: https://blogs.ubc.ca/amaurydb/2013/11/17/is-apple-going-mad-or-to-the-contrary-being-brilliant/

One of the most upcoming apps in today’s world, Snapchat, has turned down an offer from Facebook worth $3bn, for Co-founder and CEO Evan Spiegel’s young firm. Two years ago, when Evan and his Stanford classmates decided to create the next renowned instant messaging app, they initially decided to name it “Picaboo”; however towards the launch, they renamed it to Snapchat.

The $860 million dollar company believes its worth more than what Facebook offered and with new ideas of raising revenue such as paid services within the app; it could potentially raise large sums of revenue. One of the main reasons why they believe they can gain large sums of revenue is simply because of its large customer base. The apps main demographic is users between 13 and 23 years of age and recent studies show that more than 45% of the people with smartphones use Snapchat.

Could Snapchat be worth more than $3 billion in the coming future? Could the net present value of $3 billion be less than what Snapchat would be worth in the future? If Snapchat’s value proposition of introducing paid services within the app is successful, they could potentially be worth more in the future.

Source:

http://www.independent.co.uk/life-style/gadgets-and-tech/news/the-23yearold-snapchat-cofounder-and-ceo-who-said-no-to-a-3bn-offer-from-facebook-8940433.html

In Canada, one of the largest furniture companies, IKEA, has decided to dedicate itself to becoming more environmentally sustainable. IKEA has gained the reputation of being one of the most ecofriendly retailers in Canada and plans to further enhance this reputation.

On Thursday, IKEA announced to commit €3-billion to construct renewable energy plants until 2015, by which time will generate enough electricity to equal to 70 percent of its own consumption. After installing a 46-meggawatt plant in Alberta, IKEA will install a 20-turbine wind farm in Pincher Creek, which will ideally produce 161-gigawatt hours of electricity each year. IKEA is able to demonstrate its vision of corporate sustainability by its investment in renewable energy.

IKEA is aware of its customers’ desire to live more sustainably and is thus demonstrating the effort to be more corporately socially responsible (CSR). In addition to its own use of renewable power and high-efficiency lighting, IKEA is expanding its line of green products. This fall, it began selling solar panels for home use in its British stores. IKEA’s benefits from corporate social responsibility (CSR) has enabled it attract more customers, which will subsequently reap them additional long-term benefits (i.e profits).

Source:

http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/ikea-eyes-low-carbon-future-with-alberta-wind-energy-project/article15436596/

Google Inc.’s. Acquisition of Motorola has not been steady over the pass 18 months and the once-mighty mobile pioneer continues to suffer from falling sales while struggling to find its footing in a market now dominated by Apple Inc. and Samsung. Motorola recently announced its unveiling of the ‘Moto G’, which has all the features of a smartphone as well as being compatible with latest version of Android. But what makes this smartphone so different?

Google Inc. have adopted what they call a ‘Volkswagen strategy”, as Volkswagen was initially designed to offer affordable automobile options. Similarly, Motorola plans to offer the new ‘Moto G’ at a price of $200, cheaper than any smartphone on the market. They aim to provide premium smartphones to people around the world who have never owned a smartphone, simply because it was too expensive.

In addition to being affordable, the new phone will have all the features a regular smartphone would have while also being small and relatively easy to carry. However Motorola is aware of the competition it faces from its other competitors such as Nokia, who also look to penetrate the smartphone industry.

Source:

http://business.financialpost.com/2013/11/13/motorola-moto-g/?__lsa=74dd-704f

In today’s world there isn’t anywhere where ads don’t exist. It has become so common to the public that we feel invulnerable by them; however that hasn’t stopped Instagram from entering the social media advertisement scene.

On November the 6^th, it revealed its first advertisement on its news-feed and surprisingly more than 5% of Instagram users actually ‘liked’ the advertisement. Although this photo sharing app was being tactical by first introducing the video feature to beat out its competitors, Vine and then use it to promote video advertisements as these appeal more to its users than ordinary online advertisements.

However the result of introducing ads might frustrate some of their users, they will soon adapt to accept the ads, as did users of Facebook and Instagram. It is most likely not going to affect Instagram at an increasing rate, due to Instagram’s brand image and positioning in the social media market. Its point of difference is real-time photo sharing, which currently no other app on the market offers. This gives them a vast competitive advantage over any rivals that may want to offer such services and thus they should not see a fall in its number of users.

Source:

http://www.theverge.com/2013/11/7/5076268/instagram-ads-are-turning-into-likes-five-percent-of-the-time