Apple is at it again!

A

You have likely heard of the Apple Watch, the latest innovation in wearable technology, they call it. My thoughts on the concept of Smart Watches aside, todays post is more a criticism of Apple.

So Apple have released their new smartwatches, which act as an accessory to the iPhone (As all Smart watches are, they are only accessories). And Apple have released 3 variations:

  • Apple Watch Sport: The watch body made from aluminium, and a rubber strap
  • Apple Watch: The mid range, stainless steel construction
  • Apple Watch Edition: Made from gold, for the excessively rich who have little to do with their monies.

Now the prices for these watches vary, given the size of the screen you want, and what strap you choose, as well as what version of the watch you want. But the base model sport edition (38mm model) will set you back £300. That is a lot of money for a watch which costs £55 to build. That is the construction of components and the manufacturing and boxing of the watch. £245 extra is what you are paying for the Apple Watch.

Now, I am not as shocked and outraged as I was when I found out the production costs of the iPhone. I am more concerned with it, however. Yes, in order to be a successful business, it is required that you make a good profit on your product. It isn’t uncommon for a company to do this with their products, Samsung and LG all charge more than the actual components are worth, because it makes a product. What I do not like however, is that a company adds hundreds of dollars/pounds/euros to the price, to take more money out of the individual customer. This is part of a blog post I wrote a while ago, talking about annoyances of mine, and I feel this encapsulates the argument that I am making:

‘a standard iPhone 5S, 16GB of storage is £549. Of course, it doesn’t cost THAT much to produce an iPhone. I understand when a company wants to make a profit, if it’s £50-£100 that would be OK. The bog standard iPhone 5S I previously mentioned costs just under £120 to make. Apple makes £429 profit on each iPhone sold.’

Again, I shall stress, my problem with Apple is not because of this. A lot of companies have done this before, and while that doesn’t justify it, I add this because it would be unfair of me to scapegoat apple for a business practice that has been used for years, by many other companies. What I dislike about it is that Apple has a loyalty. It’s consumers are its fanbase. No matter what price an Apple product is, there will be those people who buy it, and I feel that they are being robbed. For the loyalty you put into that company, and the money that you spend on it, you shouldn’t have to give an arm AND a leg to it. I guess that is just capitalism for you.

As I stated in that ealier blog post, if the product was maybe £50-£100 more than it’s production cost, you could have it all. You could keep your consumers happy, and probably gain a hell of a lot more money than what you are currently making. Say you have a cake sale, that is £1 a cake, when the cost to produce one cake was 33p. People buy your cake, you break even, and you make a decent profit. There is another cake sale, and the cakes are 50p, with the cakes costing the same 33p to produce. That business makes a killing. People buy multiple cakes, and your consumers tell their friends that your cakes are so nice, and you get even more business. That is the business model you should take! Especially for a new product like the Apple watch, make it cheaper, and give a broader number of consumers the chance to try it, then when you make the second version, you can bring the price up. It is that simple!

Besides my iPod, I will likely never buy another Apple Product, at least not by my own freewill. People, if you’re happy with the pricing, then by all means, feed the company. But if you are like me, and you are tired of feeding the greedy mouth consumerism, then just stop feeding the beast

About the author

Ben

Since 2012, Benjamin Attwood has written for the If you Ask Ben blog.

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