2020 has become a weird year when a symbol like Oneplus which was aimed at fans is selling their produces at twice the cost of the latest device from Apple a fee label. For reference, even the root live phone that was launched in 2007 was priced more than the exactly released iPhone SE 2 at $499 even without adjusting for inflation. And obviously, it came quite a few actions! Let’s understand why Apple has now taken the nosedive and secreted the iPhone SE at $399 in 2020, with the pricing approaches that most smartphone manufacturers follow. Pricing strategy involves providing the initial price and then providing a plan for changes in price in the future.Basically, pricing depends on three major factors. The cost of raw materials and assistances involved in preparing the concoction, the miscellaneous costs which includessales tax import and export duties and so on and finally, the profit that themanufacturing go. Based on these three points, there are three major programmes that smartphone makes generally follow. Price skimming is a strategy followed by premium labels where the products are priced very high with higher revenues so that fewer marketings are needed to break-even for the manufacturer. Since 2007, iPhones and in general, all smartphones are becoming more costly, but given the versatility that telephones have achieved in that period, it is not an exaggeration to say that the rise in price was expected.The most payment iPhones have a price range from $1200 or Rs 92000 and $1400 or around Rs 110,000. And that is if you are lucky enough to live in the USA. The prices of iPhones in all the other parts of the world is considerably higher compared to that of USA with the highest-end model priced at around $1,900 here in India. Since 2017, Apple secretes three iPhones every year for creating the decoy impact to push the sales of the costliest mannequins. The decoy gist is a phenomenon where the consumers will tend to have a change in preference between two alternatives when come forward with a third option that is asymmetrically reigned! Embarrassed right? Let’s understand with an example.Consider that “youre in” a movie theatre and the theater sells you two options for buying popcorn buckets. A small bucket for$ 4 and a large bucket for $8. Most of us tend to deplete less and hence we go for the cheaper option. But if the theater wants to increase the sales of the larger bucket, what do you think that they can do? Give a discount on the larger bucket? No , no , no! Who wants to give a reject when they take a smacked in profits right? There’s a much better strategy than that. The better method would be to give a third option of a medium pail at $7.50. This is called the decoy pricing and is aa proven method for tricking our attentions into equating the cost here buckets andeventually buying the larger bucket thinking that that is more value for the money. In 2019, the iPhones applied this upshot where the iPhone Levin was priced at $649, while the iPhone 11 Pro was priced at $999 and the iPhone 11 Pro Max at $1099. Here, the iPhone 11 Pro was acting as the decoy. Now let’s assume that the medium container was priced at$ 4 and 50 pennies rather than$ 7 and 50 cents. Here, the small bucket would act as thedecoy for the medium one. This approach was followed by Apple in 2017 where they were pushing the sale of the iPhone 8 Plus and the iPhone X being the limited edition model. It was even followed by the 2020 Galaxy S2 0 sits. Today phones not just status badges but are essential tools and this created a vacuum-clean where companies like Oneplus and Xiaomi developed who followed the penetrationpricing. This programme is followed by very new companies or companies that don’t have a brand reputation where the products are originated priced at very low prices to initiate the word of mouth.In this case, the cost of the products andother costs remain more or less the same but the profit margin is kept extremely low expecting that customers will switch to the new symbol because of the lower premium. In 2014, Oneplus launched their one plus one which was priced around Rs 22,000 rupees when phones with same specs like the Galaxy S6 were being sold at Rs 50,000 rupees. But companies applying invasion pricing generally increased the prices of their products as occasion goes by very. You can see that the prices of Oneplus flagships have increased from $ 299 in 2014 to $699 for the cheapest modeling in 2020. This is partially due to the increased cost of production as we discussed earlier but is also partly due to the increased advantages. As the costs of these mass telephones havegone up so has the average time taken for a person to upgrade their telephone. This would mean that it is increasingly becoming difficult for manufacturers to sell their flagships. This is because today, the iPhone has much more competition.Not from Samsung , not from Huawei, but from the iPhone itself. When the iPhone releases the iPhone 11 Pro, it is very similar to the previous modeland for an average patron, it doesn’t make a difference. This methodology in most researching the market and pricing the products according to the same makes existing in the market. Now, when a big company like Apple does this it is also called’ greedy pricing ‘. This involves eliminating the products in a similar cost compas with superior quality products or with its brand significance. For achieving this, big companies like Apple can afford to make zero revenue or even take negative profit for a considerable sum of time.Apple has made this approach a couple of meters in the past five years but they have never priced a brand new iPhone for less than $500. This is because pricing any make to low-pitched may put over clients from buying it thinking that it is an inferior make. But the iPhone SE 2 is pretty different here and there are four major reasons why this iPhone can be a beings success. The iPhone XR and iPhone 11 were the largest selling telephones in the past couple of years and the iPhone se 2 is priced nearly $300 cheaper than those two. People ever know that Apple never compromises on the quality by lowering the price. So considering the trend it is reasonable to assume that iPhone SE will definitely be as successful as the iPhone XR and the 11 if not more successful! With the economy slump due to the ongoing coronavirus pandemic and parties being more sensitive about their spending demeanors, Apple has mentioned the pricing with this product. Even outside the USA, in countries like India the iPhone SE 2 rates Rs 42,500, which is around $560. This is 160 dollars costlier than the American pricing but comparing that with the iPhone 11 throw which expenditures around $350 more and the iPhone 11 Pro Max which expenditures around $500 more, I would still call the iPhone SE’s pricing not fair, but we are paying the least Apple tax now. This is also true for many other countries. We is absolutely call this phone cost for coin because Apple has put the internals of a $1000 telephone at a $400 premium compas. No other telephone at this toll wander would have wireless billing waterproofing and the fastest processor in the planet. Sure, the design is a bit outdated but most people don’t care. And parties is likely to be cherish the olderdesign because it doesn’t have a notch and it also includes the touch ID which can be useful in the period of the pandemic where we are using masks.As smartphones get bigger recently, a pact telephone with flagship internals isa pretty good deal for a lot of parties. That is particularly true when it happens to be an iPhone because smaller telephones frequently have shorter battery life but not the iPhone.
