PLEASE NOTE: ONLY RESPONG TO 2 STUDENTS @250 WORDS PER REPLY.
Read the Forbes article, “Apple iPhones, iPads And MacBooks Are Getting More Expensive” regarding Apple price increases throughout the globe for specific products.
Reflect upon the following in your discussion post:
Who are the biggest winners and losers, based upon increase in prices and prices overall, relative to the rest of the world?
Do you observe any trends relating to specific products being more expensive in certain regions?
Consider the highest- and then the lowest-priced regions of the world and those with the highest and lowest increases. What trends do you see? Did you observe anything that might explain the significant distinction between Apple’s pricing in different markets?
student 1
When it comes to price increases and decreases. countries like the United States and the UAE seemed to have the largest benefits to lower prices across all three products. Brazil had decreased; however, they were already paying some of the highest rates. I noticed that most of the European countries had large increases, especially with the MacBook. Singapore was also a winner and either had decreased or some of the lowest increases. Sweden did not fare very well. They had some of the highest increases across the board. It’s interesting because they were priced competitively and not much more than the United States. Japan went up as well, but they are still cheaper than the United States when converted to the dollar for a MacBook.
I noticed a few trends concerning regions. I would like first to point out Turkey which has been dealing with terrible economic inflations for the past few years. The second one I noticed is that many European countries are priced similarly. This is easy to notice because many use the Euro, so it’s a common currency. There were also decreases in some of the Asian countries such as Malaysia, Thailand, and Singapore. My thoughts were that the infrastructure is being built here and Apple can afford to lower prices. There could also be a change in tariffs.
Two of the highest-priced countries were Brazil and Mexico. When I looked at their cultural values, I noticed they both had very high-power distance compared to the United States (The Culture Factor Group, 2023). In this society, status symbols are important; having an expensive Apple device would help communicate status. Countries with higher power distance tend to be less price-sensitive as well (Cateora, Graham, Gilly, & Money, 2024). I also noticed that part of the problem for Brazil is the tariffs and additional costs of getting the products to the consumers. The cost of getting the product to consumers can cost up to 50% of the price (Cateora, Graham, Gilly, & Money, 2024). I imagine the high Apple products in Brazil can make a gray market where distributors buy products in other countries and bring them over to sell.
One other factor I noticed was that many of the Asian countries seem to be cheaper than others. I imagine this has to do with the price of transporting the goods and any free trade agreements such as the Association of Southeast Asian Nations. Apple products are made in China by partners such as Foxconn and it would be cheaper to export these through free trade agreements.
I also wanted to comment a bit on Apple’s overall pricing strategy. They use a price-skimming strategy. This strategy brings the product in at a high price when the customers are relatively price-insensitive (Cateora, Graham, Gilly, & Money, 2024). The price will go down as the model gets older and another product is ready to come out. In the case of Apple, they intentionally set prices very high giving their products a feeling of higher quality.
References
Cateora, P. R., Graham, J. L., Gilly, M. C., & Money, R. B. (2024). International Marketing 19th Ed. New York: McGraw Hill LLC.
Kelly, G. (2023, January 25). Apple iPhones, iPads, and MacBooks are getting More Expensive. Retrieved from Forbes: https://www.forbes.com/sites/gordonkelly/2023/01/25/iphone-ipad-macbook-pricing-apple-prices-worldwide-2023/?sh=28a5dd16914b
The Culture Factor Group. (2023, October 16). Country Comparison Tool. Retrieved from The Culture Factor Group: https://www.hofstede-insights.com/country-comparison-tool?countries=brazil%2Cunited+states
student 2
(1) Who are the biggest winners and losers, based upon increase in prices and prices overall, relative to the rest of the world?
Based upon price increase the United States and China, which are Apple’s largest markets, were the biggest winners. There were no reported price increases across their markets compared to some drastic changes around the world. A reason for this is potentially because their economies are more stable and can adapt from world issues better then others however the size price increases from the losers are still insane. Those losers include countries like Sweden, Japan, Poland and others. Prices increased more then 92% on some items (iPad) and common products like the iPhone have increased by 10-20%. Insane!
(2) Do you observe any trends relating to specific products being more expensive in certain regions?
A big reason for these increases are due to weakening currencies along with trade issues. Obviously there are some world issues going on in the middle east and in places like Russia. Furthermore, the currency example can be seen in Europe (using the Euro) with countries like France, Belgium and others having very similar increases. All of those reasons can play into price increases we are seeing here.
(3) Consider the highest- and then the lowest-priced regions of the world and those with the highest and lowest increases. What trends do you see? Did you observe anything that might explain the significant distinction between Apple’s pricing in different markets?
The trends you can see across these increases and decreases is the currency in those countries along with the trade regulations that have been put in place. Turkey for example who saw a 158+% increase is in an economic crisis with their currency which is why the price has skyrocketed. Other countries have seen increases because inflation off the back of Covid-19 and what that has done to supply chains and economies across the world. Looking at the markets with untouched prices you see more stability within their markets including their currency and supply chain allowing them to give Apple the ability to not have to hike prices for any reason.
