iPad Pro iPad Pro is too cheap

[Rainshadow]

From the point of view of Apple (or any other company), what you want is to extract as much as possible of the consumer surplus, any less than 100%, "you're leaving money on the table", for that you need perfect information and to be able to price the good differently for every singular consumer, which is not feasible of course.

You don't profit on backlogs, nor mass ordering per se, this all cost money to Apple. The OP, while perhaps looking for controversy, makes perfect logic.

Economic surplus - Wikipedia

en.wikipedia.org

That’s a theoretical concept without considering other variables. And even still, only realistic as a snapshot in time. These devices will be for sale for 1.5 years. Apple doesn’t adjust prices, so they aren’t pricing for the initial grab and pent up demand surge. They are pricing for the full next 18 months. What’s more, you Are also forgetting about locking into the ecosystem, App Store services, etc etc that a “lower than possible” purchase price provides in the long run. Cheaper purchase price allows more people into a product which itself provides more income in services.

Your field may be economics, but if you have your nose too deep in a book, you sometimes don’t see the reality of an issue. In reality, I think Apple knows what they are doing.

 

[Slartibart]

Does the MacBook Air have a touchscreen? Does it work with the Apple Pencil? Is it detachable? Can it work as a tablet?

Yeah. Although: Can it determine how many chickens it would take to be able to kill a lion? Or: If roses are red, why are violets blue?

 

[slplss]

Too expensive you can buy a computer or any laptop for that price

Here we go again https://forums.macrumors.com/threads/ipad-as-a-laptop-replacement.1937134/
It's hardly an argument, each device has its use, and for the most people they will use both Mac and iPad in the same way, so it's only a matter of form factor.

 

[LFC2020]

It is obviously too cheap if you got to wait almost 2 months to buy one.

The $100 price increase is not stopping people from mass-ordering it.

Don’t know if you’re being serious or not ?‍♂️ This is the wifi 1TB model, doesn’t look cheap at all.

Very cheap hey?

 

[ZombiePete]

From the point of view of Apple (or any other company), what you want is to extract as much as possible of the consumer surplus, any less than 100%, "you're leaving money on the table", for that you need perfect information and to be able to price the good differently for every singular consumer, which is not feasible of course.

You don't profit on backlogs, nor mass ordering per se, this all cost money to Apple. The OP, while perhaps looking for controversy, makes perfect logic.

Economic surplus - Wikipedia

en.wikipedia.org

That’s a really simplistic view of the economics of the situation. In a services economy, it’s very important to have your products be priced accessibly so that people can buy into your ecosystem and spend money on your services. There’s a reason why a lot of tech hardware is sold at low margins and even a loss.

 

[Digitalguy]

That’s a really simplistic view of the economics of the situation. In a services economy, it’s very important to have your products be priced accessibly so that people can buy into your ecosystem and spend money on your services. There’s a reason why a lot of tech hardware is sold at low margins and even a loss.

100% agree. You don't need to have an economic background to see that the OP's title is a flawed statement (I teach economics and finance at University but it doesn't matter much here). And that statement that started with a patronizing sentenece was a very short-sighted application of economics to Apple's businness stragegy. Trying to profit from a temporary supply shortage by increasing the price (temporarily? permanently?) to ajust it to said supply shortage would be a big mistake, especially for a company that has and continues to build an entire ecosystem.

 

[Isengardtom]

Where is he going with this Statement ?

What I’m trying to say is that with all the restrictions (here in Europe at least), people’s spending pattern has changed from spending more on activities such as restaurants, coffee shops,… to spending more on their homes and the tech in it.

Hence increased sales to devices such as iPad Pro’s

it wasn’t meant as some nasty comment

 

[ericwn]

Too expensive you can buy a computer or any laptop for that price

Computers are laptops and so are iPads. Not sure the point you are making.

 

[UpRight]

It is obviously too cheap if you got to wait almost 2 months to buy one.

I see things little different to you UBS28. The longer wait is partly due to the popularity, but also due to Apple's scheduling. IF Apple announced a new product today; and the Pre-Order starts in 2-days; and delivery 5-days later. One would say the 'delay' is only 1 week. Even if the popularity of the product pushed the shipment out by further 2-weeks, it would be a total wait time of 3-weeks. What I am getting at is, if the push back in delivery is to be used as a measure of product popularity, at least we could remove the Apple schedule component. In the case of iPad Pro, original delivery estimate was around 21 May... that's slipped to say 15 June on some models.

Regarding your comment about the pricing... most of the folks who bought the iPad Pro at launch are Apple fans (we are all on MacRumours forum right? ?). There will be a high demand at the start. The question is, will these M1 iPads still be in high demand in 6 months? What would the total iPad Pro sales be over the following year? I think it will be interesting to see which models are selling better? According to the buyer survey on this forum, it appears 256GB and 1TB models are selling well to early adopters. Will that still be the case amongst the general public? ?

 

[Tagbert]

Joke or not?

it depends on your situation. Obviously, if you are one of the many who lost their job or who's business was hit by the lockdowns, you will have less money. For people who were able to continue working, you likely are spending less on commuting, travel, dining, recreation, etc. That group has more avialble money now than before pandemic. Doesn't mean that is's fair, just how the variable impacts have played out.

 

[AttilaTheHun]

it depends on your situation. Obviously, if you are one of the many who lost their job or who's business was hit by the lockdowns, you will have less money. For people who were able to continue working, you likely are spending less on commuting, travel, dining, recreation, etc. That group has more avialble money now than before pandemic. Doesn't mean that is's fair, just how the variable impacts have played out.

and there are those that going every day to work and the fuel price jumped almost a $ per galon ?