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How Apple Defends The Hostage of Cheap



  Low Price Make no mistake about the axiom of this life on the planet earth. Everyone is out to get your money. Everyone. Every maker of what you buy, or every distributor of where you buy, will have the most money from you.

The same goes for your boss, government, religion. Your boss wants you to work as little as possible. The government wants you to pay as much tax as possible. Even religions ask you to give until it hurts. In a world where everyone wants a piece of yours, how is Apple's customers so happy after giving up more than any other customer group?

It's The Package

Apple has received recognition over the years to be an innovative technology company with a wide range of market disruptions. Apple II, Mac, iPod, iPhone, iPad, Watch. Apple shapes how the computer industry ̵

1; mobile or desktop and portable – advances. In addition to running the various segments in the industry, Apple also cuts most of the industry's profits with gadgets which, in every instance of substance, are priced higher than competitors.

How does Apple flare the flashes that are infected by their competitors so that only Apple avoids the low prices that have little or no gross margins and even less profits?

Think about it. Apple's Mac has about 10 percent market share, but more than 50 percent of the PC industry's revenue share. Similarly, the iPhone handles far less than 20 percent market share, but pulls in more than 90 percent of the smartphone industry's profits. The story is much the same with every other product. iPad, Watch, Apple TV, iTunes. Apple charges more for similar products, but retains the lion's share of profits.

How does Apple avoid low cost or cheap?

That's the package.

Apple II was not the first PC, but it was the first to do more at a reasonable price. The Mac was not the first point and click graphical user interface PC, but it was priced properly and set the stage for computers in the future. Likewise, iPod was not the first portable media player, but it was the first to do everything right at the right price. Smartphones before the iPhone had a touch screen, but Apple made the iPhone more and makes it easier than competitors. See the trend? Apple demands more for a packaged device that reduces complications and improves ease of use.

That's the package.

Think about how much extra money Mac, iPhone, iPad, Watch customers pay for their devices than competitors, but then compare what they come back. Across the board, Apple's devices are safer, mostly easier to use, with more ease of use, maintaining higher resale value, and working better than other multiplatform devices. Add to that the support Apple provides at the Apple Store and the Genius Bar – not replicated by any competitor I know – and you can see where Apple's walled garden ecosystem has a packaged advantage that is not easily replicated or compared to a competing unit, but sufficiently better to Customers are happy to pay more for the overall experience.

It's not the hardware. It's not the software. How it works together. It's the package.

Competitors copy Apple's hardware design explaining why many PC notebooks, either in Windows 10 or Chrome, look like the MacBook. It explains why almost all smartphones look and work like an iPhone. Ditto for tablets and iPad. Competitors copy the design and functionality of Apple's products, but fail to copy the package .

Nevertheless, the package of components that work so well together that gives Apple differentiation must control higher prices, larger margins and profits that exceed all competitors combined. Most customers only buy what is least expensive, or any product that is priced less than Apple's comparable products. Apple does not care because its competitors do not copy the one ingredient that separates the interest rate from cheap to profitability.

That's the package.


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