The Strange Case of the $400 iPhone and $700 Wheels: Apple’s Ever Evolving Identity Crisis

Last month, Apple was on a role when it comes to new product releases. The MacBook Air, iPad Pro, Mac mini, and more all saw new, upgraded releases across last month, all of them met with the usual fanfare that coincides with releases of new Apple products. But out of all of these releases, two clearly resonated the most with people: the new iPhone SE, and a set of wheels for the Mac Pro. While at first these two products would seem like they have nothing to do with each other, when you take a closer look, the similarity between the reasons for the hype around their releases is apparent. That similarity is value, more specifically, the inherent value either of these products provide for their price, which one must understand to fully grasp this topic. The new iPhone SE made waves for being the first truly affordable-to-the-mass-market iPhone in years, with a low $400 asking price that will net users a device with the same processor as the $1000 2019 iPhone 11 Pro in the dated but still well designed form factor of 2017’s iPhone 8, which the SE supersedes in the iPhone lineup. On the other hand, the brand new set of wheels that Apple released for their Mac Pro cost an almost unbelievable $699, a price tag that understandably shocked the world upon its announcement. So what is Apple’s game here? Are they trying to covey a message of affordability with the release of a $400 iPhone, or are they trying to position themselves as a luxury brand by releasing a set of $700 wheels for their already expensive $5000 professional computer. Well, the answer is both. Tim Cook understand the value of branding, and he knows that positioning Apple as a company that provides high quality products with matching high quality user experiences is key to retaining Apple’s image. But he also knows that, while these products need to be priced to be accessible to as many people as possible, pricing every product that way could dilute the image of Apple as a high quality brand. So, Apple has to maintain this balancing act of releasing affordable and accessible products that cater to more frugal customers, while also releasing commodity-priced products, as to uphold the image of the Apple brand. To do this, Apple typically attaches these commodity or luxury prices to non-essential products, like accessories, products that aren’t needed for a great user experience, but certainly benefit it when owned. Such products include Apple’s $250 Airpods Pro, $350 Magic Keyboard, and, in this case, their $700 wheels. So, to conclude, Tim Cook doesn’t want Apple to look like a luxury brand, such Ferrari or Lamborghini, but they don’t want to appear as a budget brand either, such as a Ford or Toyota, they want to appear as a high quality brand that offers products with high but worthwhile prices, and to do this they sell products that both allow frugal customers to have a good user experience at a price they can swallow, while still offering luxury priced products that fewer people will or will need to buy, to uphold their brand image.

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