Why are products from Apple so much more expensive than similar products from other brands? Microsoft has even accused apple of imposing an “apple tax” on those who choose a Mac over a PC. How is Apple able to remain competitive yet still maintain its high prices? With this question in mind, I searched for ‘apple brand positioning’ on google and found a great commentary called Understanding Apple’s positioning.
The answer to my question, according to the article, lay Apple’s premium product positioning. Using a strategy called “needs-based-positioning”, Apple’s line of products are targeted to a consumer base that is less price sensitive. Drawing from micro 101, with a more inelastic demand curve, it would be a better choice for Apple to maintain its current pricing. Moreover, Apple`s brand image is one that sets itself apart from other products through innovation and quality. If Apple did indeed lower its prices to appeal to all segments of the market, it would break the ‘promise’ made by its brand and cause confusion among consumers.
Apple’s marketing strategy, in fact, is just as innovative as its product line. Instead of directly competing with other products, it has successfully created a ‘barrier’ throughout the years to prevent its competitors from entering into its territory. By continuously increasing pricing on newer generations of its products, Apple has acquired a position in the market as the leader of innovation and quality. If other brands wished to compete with this position, they would have to undergo expensive marketing campaigns and product redesign while running the risk of losing their more price-sensitive consumer base.
Apple’s higher pricing is not only indicative of its premium quality, but also part of its successful strategy of assuming a particular niche within the market and maintaining an intact brand image.
Photo Credit: http://www.joyoftech.com/
Credit: http://switchtoamac.com/site/understanding-apples-positioning-part-1-a-premium-brand-at-a-premium-price.html
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