It’s time to think of Apple as a global luxury brand

“I’m not an Apple expert, nor do I read many blogs or reviews about each new product that the Steve Jobs co-founded company casts onto the market,” Antoine Gara writes for TheStreet. “However, every holiday season, as I pass Apple’s flagship Fifth Avenue store in Manhattan, I wonder the same thing: Is Apple a technology company or is it the fastest growing luxury brand in the world?”

“Every quarter I comb through Apple’s results and see few similarities between the profit margins and earnings of the iPad and iPhone manufacturer vs. its supposed competition,” Gara writes. “Mobile devices, which drive astronomical earnings and margins at Apple, have so-far proven to be a cost center for direct competitors such as Google, Microsoft and Amazon.”

Still, Wall Street analysts can’t help themselves from comparing one unit of Apple iPhone sales to those of Windows or Android,” Gara writes. “Google can take whatever global market share it wants from Apple, and yet when investors see both firm’s earnings it is clear who is winning the battle for mobile device profits.”

Read more in the full article here.

20 Comments

  1. I just can’t see Apple being a luxury brand if it is possible for people to get iPhones for free with certain carriers. To me, a luxury brand is one that is very expensive, and popular with the ultra-rich. Think Ulyesse Nardin, Christiaan Van Der Klaauw, and Konstantin Chaykin for watches, or Lamborghini, and Maybach for cars. For computers, I would have to say Suissa, The Datamancer (if you like computers that look like 30’s Art Deco radios), and for phones, Vertu. While Apple is good, the ones I mentioned would fit the “luxury brand” description.

    1. While you might get the latest iPhone free on some contracts, the cost per month is prohibitively high for most people to be able to afford it. Thus it’s a luxury brand.
      There, not so difficult to understand, is it?

      1. If its the plan that’s expensive, that’s Verizon, Sprint, AT&T, etc that’s the problem, NOT Apple. However, this does seem to be difficult for you to comprehend.

        1. The telcos have to pay the cost of the iPhone with 24 payments from the customer (ASP of $800 / 24 = $33.33 per month) If the phone is cheaper, the phone bill goes down. Apple’s cost is part of the huge phone bills.

          Thats not so challenging to understand, is it?

    2. Yeah, but Apple could buy all those companies and get back change. Hey, that’s a great idea. Be sort of like marrying into old wealth for status. Apple shareholders could then walk around with their noses in the air even if Apple’s share price drops. I like that. An Apple T-shirt with a big Apple in the center and small logos of those other brands around it.

  2. I have heard that in England that only chavs wear Burberry. When Apple gets to that ‘iconic’ status after the Arendts takeover, we can truly weep for a golden era – that Apple is a fashion statement – long gone.

  3. I’m probably not going to be buying any Burberry coats or Mercedes cars. I can’t see ever buying a computer other than a Mac. So it doesn’t fit my definition of a luxury brand. Macs are sensible computers, despite “Mdn” misinformation about equivalency. When your TCO numbers are the lowest of any widely available choice, buying Apple products is frugal. And there is a distinction to be made between luxury and quality.

  4. “I’m not an Apple expert . . .” That should be enough to qualify Gara to write an article for TheStreet. Why bother reading blogs or studying the company. Just start pecking away at a keyboard.

  5. Apple may seem like a “global luxury brand”, but it’s really a mass-market aspirational brand. Virtually anyone can buy an iPod, nowadays. Stores are welcoming, not forbidding like most luxury stores.

    1. It’s both. Apple’s clearly articulated objective is to make the best products on the planet AND to put them into the hands of as many people as possible (subject to the unstated constraints of maintaining viable profit margins).

      This is really impudent, and revolutionary, in a way. For almost the first time, the rich are not alone in owning the best.

  6. word ” luxury” is offensive to 99 percent of world population, as it means overpriced phony garbage like gucci bags and the like, apple is pure utilitarian of high order like braun in germany in the 1960 or sony in the 1980, the person who wrote the article has shit instead of brain

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.