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According to Uber economic theory, Apple shouldn't exist

Discussion in 'Stories' started by itsablackmarket, Sep 13, 2015.

  1. Apple is the perfect example of a company that understands something that Uber will never understand. Quality Appeal (Apple) versus Quality Illusion (Uber).

    Apple products cost way more "for what you get" and pretty much always have. Why are they doing so well? Is it because there is value in the refinement and aesthetics of an Apple product?

    Think about that. What really drives consumers to spend money on something? I know Uber drivers can't afford to splurge on Apple products, so the opinions may be biased here..

    Fact is, consumers want the real thing, and we can provide it if Uber will simply raise the rates back to what they were and thus allow the drivers to afford to provide.

    Check out these Uber reviews: http://www.sitejabber.com/reviews/www.uber.com
    now see Apple: http://www.sitejabber.com/reviews/www.apple.com
     
    Last edited: Sep 13, 2015
  2. Yes but the State of Illusion keeps people in a state of Ah, and coming back for more.

    Ill let others take it from here, in not up to apples to oranges ah correction, lemons, this morning.

    ps, I love my Mac.
     
  3. Actually, it was Apple that said, "price it* so low that no one will be able to find a reason not to buy it*."

    *"It" being a song, priced at 99 cents.

    See also, "iTunes is a terrible piece of software, so why does everyone still use it?"

    But by all means, continue pretending that your post is insightful.
     
    UberXTampa and KGB7 like this.
  4. Everyone knows you pay a premium for Apple products just because they're Apple. Plus, at some point every business has understood competitive prices are important, even the conventional Taxi industry. Yet they arrived at 2x the price Uber is. What kind of computer will $1,500 buy you at Apple vs. the other options? Should an iPhone really cost $750? Apple has $200B+ cash reserves for a reason. That's not a valuation, that's REAL money. Uber is trying to beat them to self driving cars, good luck with that..
     
  5. Relevant article:

    What is Premium Pricing Strategy?
    by Lisa Magloff, Demand Media

    Pricing is a major element of marketing any product, and it is vitally important to set the right price. A price that is too high or too low for the target market can seriously affect sales. Elements such as target market, profit margin needed, growth strategy for the company and market share all play a role in what pricing strategy is used. Premium pricing can used for several purposes.
    Premium pricing
    A premium pricing strategy involves setting the price of a product higher than similar products. This strategy is sometimes also called skim pricing because it is an attempt to “skim the cream” off the top of the market. It is used to maximize profit in areas where customers are happy to pay more, where there are no substitutes for the product, where there are barriers to entering the market or when the seller cannot save on costs by producing at a high volume.

    Price-quality signaling
    Premium pricing can also be used to improve brand identity in a particular market. This is called price-quality signaling, because the high price signals to consumers that the product is high in quality. Some companies use this strategy to give their product an aspirational image. For example, according to BetaNews, Apple now has 91 percent of the market in computers costing $1,000 or more. Thee company has used premium pricing to capture the market for high-end, high-quality computers.

    Competition
    Premium pricing is not generally used when there is direct competition for a product. Competition tends to undercut prices and lead to poor sales. For this reason, premium pricing is often a short-term strategy. The longer a company can keep its competitive advantage, the longer it can charge a premium price. Many products start out at premium prices, but the price is cut once competitors appear on the market.

    Brand awareness
    Some brands can continue to charge a premium price because their entire brand image is based around luxury. According to John Quelch, of Harvard Business School, it is very challenging for companies to maintain a premium-priced brand while trading as a public company. Luxury brands, such as Prada, often chose to remain private businesses, so they can stay small and exclusive, and continue to use premium pricing.

    Unique Product
    Unique products usually have the best chance of commanding premium prices. This is one reason why pharmaceuticals–where the product is protected by patent–tend to be very expensive. This is especially true of technology products. A more recent example of this may be 3D games, where the technology is still very new. According to EA CEO John Riccitiello, in an interview with Videogamer, game titles that support the new 3D format may be sold at a premium price.

    source http://smallbusiness.chron.com/premium-pricing-strategy-1107.html
     

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