Apple Computer Pricing Strategy: Key Success Factors and Profit Margin

• Main Authors: Lie Kevin Harris, 李杰仁
• Other Authors: Day-yang Liu
• Format: Others
• Language: en_US
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/m4x4ns

碩士 === 國立臺灣科技大學 === 管理學院MBA === 102 === Around the world, smartphones now represent 62.9% of all mobile phone sold around the world (2013), which is up from 51.8% last year. In the next year, the numbers are expected to go up to 70% and in a few years, every phone will be a smartphone. Apple Computer as one of the player and leader on this technology boom has revolutionized the computer industries through a string of blockbuster products that offer uniquely designed; integrated customer experiences (Heracleous, 2012). The company also one of the forerunners in applying integrated pricing strategy throughout its lineup devices. Pricing strategies for products or services encompass three main ways to improve profits. These are achieved by cut costs, sell more, or find more profit with a better pricing strategy. In Apple case, the company chooses to adapt premium pricing strategy. There are several success factors for the Apple Computer in applying premium pricing strategy in their product range. Company value, product quality, service excellence, supply chain management system, and marketing strategy is some of the key factor to gain success. Furthermore, the company has been famous for their vertical integration strategy, which maintains tight control over the hardware, software and related services for all of their products, and is one of the main reasons why it is able to generate higher profit margin. Integration strategy create reciprocal benefits both hardware and software sales. From the customer’s point of view, this bundle of device and content provides enormous value that promotes loyalty and cross-category spending. This research aims to discover Apple Computer strategy to implement pricing strategy throughout their product line up, the key success factors, and the other corresponding variables of the strategy, including the contribution of the strategy to the company sales, profit margin, and income statement; and new strategies for mature and growing markets, in this highly competitive industry.