Apple thrives by going upscale: It is Economics 101

“It is Economics 101. The best business model involves strong sales and high profit margins,” Jon Markman writes for Forbes. “Sadly, the combination almost never happens.”

“Apple almost got there last quarter. The Cupertino, Calif., iPhone-maker reported third-quarter financial results that show its plan to remake itself as a luxury brand is paying off. Newer models will push the brand further upmarket,” Markman writes. “Investors should cheer and sit back. This could last a while.”

“It is a great luxury business, championed by iPhone, and limited only by how much customers are willing to pay for Apple products and services,” Markman writes. “In July, Apple began shipping its latest MacBook Pro laptop. The super thin aluminum unibody is packed with the latest Intel core i9 processor, Apple’s T2 chip for Touch ID, disk encryption, audio and video processing, and digital assistant functionality. Fully loaded, the price tag is $6,699. Apple is selling a laptop at a 40% premium to a comparable Dell. Let that sink in.”

MacDailyNews Take: Dell can’t run macOS and their products are crap, as if designed by blind arthritic apes. Dell ought to pay their sufferers for the pain and suffering they’ll have to endure. Microsoft should subsidize them to cover their loathsome part of the deal.

Markman writes, “By all accounts, that product has real issues with the keyboard and heat throttling, a process that kills computing power because its nifty new microprocessor gets hot enough to cook scrambled eggs.”

MacDailyNews Take: By all accounts except for the true ones, that is. The keyboard is subjective. Many people absolutely love it.

Markman writes, “Apple is building a business in the mold of big European luxury brands, only bigger.”

Read more in the full article here.

MacDailyNews Take: Newsflash: Apple sells premium products at premium prices to premium customers. – MacDailyNews, October 23, 2012

16 Comments

  1. Is Honda or Toyota a “premium product?”
    That’s Mercedes and BMW.
    No, but they are high quality products, and people gladly pay the “premium” over Kia and Chevy because of the difference.

    1. Toyota vehicles are more reliable and will last longer than Mercedes or BMW. I can afford any car I want. I drive Toyota vehicles. I got rich by managing my money well. If you want to throw your money away on ‘premium’ brands go for it. I’ll stick with the real premium automaker, Toyota.

    2. A brief follow up. If you want some of the fancier luxury items just buy a Lexus. Lexus is Toyota but the Lexus models have more nice upgrades in them. I don’t see the point in paying for a Lexus when a Toyota is the same car at its core. With all the extras in Lexus models they also get worse fuel economy.

  2. Dell and windows 10 are not cheapie products they set the bar for quality. Its for Apple to strive to beat. Apart from the positivity of the apple typing experience and thinner hardware i dont see that it is better.

  3. I read the linked article

    I get the impression that the writer is subtly sarcastically implying Apple users are sort of dumb (“fawning over”), that Apple is able to sell them overpriced inferior goods to phones like from he says ‘arguably superior’ Oppo (which he twists reviews to suggest, see below)

    My reply is that most people with lots of discretionary money aren’t dumb — otherwise how did they end up with so much money?

    (btw ” he talks about the great Oppo camera which his own linked article shows has no 2X optical zoom like the iPhone… Davewrite: Cheap , you get what cheap is.

    The writer says the Oppo is ARGUABLY SUPERIOR but this is what his own linked article Tom’s Guide ACTUALLY concludes:

    “There’s a reason the iPhone X is our favorite smartphone available right now. It sets the standard for design, it’s a top-performing camera phone, and no device has been able to approach the pace set by its A11 Bionic processor. iOS-specific features, including Face ID, give the iPhone X an additional leg up on the competition.” )

  4. I’ve been using a Mac for more than 10 years. Prior to that, Windows back to Windows 1.0.

    I run Windows in VMware on a Mac when I need to run Windows, which is getting to be less and less. However, I’ve always said that Windows runs better on a Mac than it does on a PC. That includes Dell, Lenovo, Acer, etc. I’ve tried them all.

  5. Just to point out one of the many differences between MacBooks and Windows laptops: The touchpad! It is a torture to use on any Windows laptop I have tried. It is a bliss to use on a MacBook.

  6. “Newsflash: Apple sells premium products at premium prices to premium customers.”

    Headline: That Hasn’t Always Been All That Apple Sells, Nor Has It Always Been Only Who Apple Sells To.

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