Four years back in 2016, iPhone 7 arrived with a starting price tag of $649. And now years later, the iPhones price has increased by 54%. Similar if we have a close look at the other products of the tech giant, they have also followed the same trail. This is also the major reason behind Apple being the first trillion-dollar company.
Manufacturing Costs?
In the early days, when Apple iPhones, Macintosh were first released, we could relate to why these were expensive. These were category-defining products at that point in time. But glancing at the scenario today, there are a bulk of amazingly powerful and slick smartphones and laptops available in the tech market which no way matches the hefty price of Apple products.
More on, according to teardown engineers at HIS Markit, iPhone X which retails at $999 only costs $400 for material and assembling. Likewise, the third-generation iPads that cost us a hefty $699 have only a manufacturing cost of around $366. This implies Apple remains at around 30-40% profit margin on its device sales.
Then why are Apple products expensive….
Brand value
Brand value is one of the most crucial factors for any firm in whatever line of industry. A brand’s reputation plays a significant role in pulling money from the customer’s pocket. And in this case, Apple probably is a leader as it only hasn’t become a brand but a ‘lifestyle’ for most of the tech consumers.
Although being a luxury brand with hefty market value, it, in fact, provides top-notch service to its customers. Be it, functionalities, design, security, or any other factors, Apple is there to rank the top.
Also Read: Apple 16” Macbook Pro | Price and Specifications
Research and Development
Apple is one of the brands that highly invest in research and development before pushing out its products in the market. And in these processes of innovation, development, and featuring out top-notch products, Apple requires a hefty amount of wealth. This also confirms why Apple products are not cheap to produce together.
Proprietary Software
We all are very known of the fact that Apple has its own proprietary software. And in the case of Android, it being an open-source platform uses software from Google.
Also Read: Apple iPhones Price in Nepal 2021
Apple needs to develop and manage all of its software, iOS, macOS followed by other back-end services such as iMessage, iCloud and more. This requires more investment in its operational costs. Besides this, Apple being a top-player in its security platform invests high in this matter too. We have nowhere heard about Apple devices being attacked by Trojans or viruses which proves the point itself.
In the case of MacBook, Apple also charges you for in-house apps, which also comes with the development cost.
And most importantly, the customers are themselves willing to pay a hefty price for Apple products to enjoy a rich and premium experience.
So, what do you think are the other reasons why Apple products are so expensive? Please flow your thoughts in the comment sections below.
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