Is Apple devaluing itself by selling dirt-cheap iPod shuffles?

Apple Online Store“In the race to be the best, and capture the masses, cool firms often make one crucial mistake – lowering their standards so far that eventually it backfires. Apple’s decision this week to make an iPod shuffle available for just £32 [US$49] strikes me as being one of those,” Jonathan Weinberg writes for Tech Digest.

MacDailyNews Take: Apple didn’t lower their standards, they just lowered their price by passing lower component costs [flash memory] along to the consumer. The iPod shuffle is the same quality as before: excellent.

“There’s no doubt the US giant is one of the coolest companies in the tech sphere. It makes products that look good and have you salivating over them,” Weinberg writes. “Who else could have produced the ultra-thin MacBook Air?”

Weinberg asks, “But by pricing the 1GB Shuffle so cheap, are Apple not in danger of making themselves far too popular for their own good?”

“Why would anyone want a 1GB Shuffle anyway, when you can buy a 2GB for just £10 [US$20] more? The simple solution would have been to discontinue the one-gig and replace it with the affordable two-gig [US$69], thus retaining the premium price around the Apple brand,” Weinberg writes.

More in the full article here.

[Thanks to MacDailyNews Reader “Brawndo Drinker” for the heads up.]

47 Comments

  1. Obviously Mr Weinberg does not understand marketing 101. When you reach product saturation this is a classic tactic plus we are in a tight economy right now. At $49 some current iPod owners may pick up a second iPod for the road. Let’s also remember that there are ecomies of scale that are coming into play as prices of drives continue to decline.

  2. “”Why would anyone want a 1GB Shuffle anyway, when you can buy a 2GB for just £10 [US$20] more?”

    —————————–

    A better question is why would anyone buy iPod earbuds for $29 when you can get the earbuds and the shuffle together for $20 more?

  3. A product at every price level. Noone can point the finger at Apple and say their prices are too high. I think the move is brilliant. Most people that can afford it will go 2GB and higher, anyway. Over time, people seem to accumulate more than 1 iPod, anyway, and a lower price point on the entry level player encourages the behavior. One for the gym, one for the car, one for podcasts and audiobooks, etc. I’m sure a lot of people wish Apple would do this for their laptops at the $500 price point!

  4. To quote from the article, “The simple solution would have been to discontinue the one-gig and replace it with the affordable two-gig [US$69]…”

    That’s a great idea… The only problem with that idea would be what to do with existing stock of 1gb shuffles when you introduced the 2gb shuffle. Perhaps, to resolve this issue, you could discount the 1gb shuffles by – well, let’s say about $20 until you sold them. That’d probably work….

  5. How many people actually buys iPod shuffle? Probably not as much as other iPod models. At $49 per Shuffle, companies cangive them away as gift (at high quantities, I’m sure Apple can sell them at lower price). The record labels should start giving them away to stimulate the album sales. In the past record labels sold records and CD through a club, where members got discount but had to buy certain number of CDs per year. They can do same with digital download. Give away shuffle when the members sign up then allow the members to go to iTune and purchase albums at lower price (like Apple Store for Education) or just give them iTune gift certificates (but a problem with using a gift certificate is, you cannot prevent people from purchasing songs instead of album).

  6. lowering the entry level price extends the Apple brand experience and iTunes to many more people.

    + reaches many existing iPod and iPhone owners to buy a second for the beach or the gym.

    + the new $50 mixed tape…

  7. JUst my opinion but I feel that Apple wishes to get more of the general public / pc users into Apple. The curious will want to go to an Apple store and buy one of these low cost but elegant entry level iPods. While they are there they will discover the magic of Apple. Bottom line, increase in sales.

    Ken

  8. The under US$50 is a very sensitive price point. It’s psychologically easier to spend $49 than $51, even though there is little actual difference.

    This feeds into what others have said about offering 1GB Shuffles as premiums, prizes, and other sorts of giveaways.

    This was a great marketing move by Apple.

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