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Why the Apple Watch can afford to cost thousands of dollars

“Would you pay thousands of extra dollars for an Apple gadget made of gold?” Sam Byford asks for The Verge.

“The company is betting that at least some people will. Its Apple Watch Edition is made from 18-karat gold and will likely be very expensive — think thousands of dollars expensive — despite offering little to no extra functionality over the aluminum and steel models,” Byford reports. “Who would pay for such a thing? Well, just ask Vertu.”

“A British manufacturer of ultra-premium phones, Vertu is the first nominally ‘tech’ company to acknowledge the market for luxury electronics. It’s one of the first tech companies to understand that people don’t buy $4,000 Hermès handbags to improve their ability to carry things. (Leica is another.) Apple may have the high end of the conventional smartphone market almost to itself, but the Apple Watch Edition will be marketed to a well-heeled demographic of technology users that Vertu understands all too well,” Byford reports. “‘These are people that will never even consider a watch that uses aluminum,’ says creative director Ignacio Germade of Vertu’s clientele. ‘Our customers aren’t satisfied with plastic or aluminum or a product that has Gorilla Glass. They want something that matches the rest of the products that they own. If they have sapphire on their watch, they want to have sapphire on their phone.’ … ‘No one needs a Rolls-Royce — we are very open about that,’ the esteemed British carmaker told The Verge this year. ‘These are purchases of the heart.'”

Much more in the full article here.

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