Done by:Shaza

Charlene GohWei LunShi Yu11s502

Gulliver’s travel(ipad)

• First unveiled in April 2010 by the CEO of Apple, Steve Jobs.

• Developed by Apple and uses the same operating system as the iphone and ipod touch.

PROJECT AWhen did iPad first originated?

Appeal to consumers• In a market where more advanced products

are continuously introduced, producers aim to attract the consumers’ interest.

• Thus, if the product is in demand, the price of the iPad can be increased to maximize profits as consumers are willing and able to purchase it.

PROJECT AHow is the price of the iPad determined?

http://planet-iphones.com/2010/12/16/corporate-usage-of-tablet-devices-ipad-rules/

PROJECT AHow is the price of the iPad determined?

Production cost of iPad• The basic version of an iPad costs about

$260 to manufacture, according to the research firm iSuppli.

• The higher the cost of production, the higher the price of the iPad, so as to cover increased costs of production.

• However, in a competitive market, producers aim to produce at the lowest possible costs as it would in turn allow them to lower the prices of their products. Hence winning the spending votes of consumers.

PROJECT AHow is the price of the iPad

determined?

Prices of substitutes• Consumers aim to maximise their

satisfaction with their limited incomes.

• Hence when the price of substitutes are lower that the iPad, the demand of iPad would decrease.

• Therefore in order to overcome competition(to increase profits), the price will be lowered.

PROJECT AHow is the price of the iPad

determined

Prices of iPad varies in different countries!!

WHY??

This is due to taxes that in some countries must be included in advertisements or cost quotes.

DID YOU KNOW???

DID YOU KNOW???

Generally, iPad is

the CHEAPEST in

US!!

The iPad dock can be attached to what looks like one of the normal keyboards on the front of it which transforms the touchscreen tablet into a pseudo laptop.

PROJECT ARelated/associated products for

iPad

• The iPad batter case

It is not only a charger but also protects the iPad from short circuits, over-current, over-charging, and over-discharging.

PROJECT ARelated/associated products for

iPad

PROJECT BCONSUMER’S POINT OF VIEW

Appeal found in the iPad.

Consumers are very willing to purchase the iPad, as judged by the positive Response to the previous “iterations” of Apple's touchscreen technology,e.g the iPod Touch/iPhone.

Never before had there been a tablet that worked so wonderfully.(Comparison to the tablet PC's released in the 2001 era thatFlopped in sales due to bad functionality)

Attractive user interface, reliable and intuitive operating system withSupport for a plethora of applications; the iPad's apps are applicableTo many everyday situations.

These reasons make the iPad more marketable hence it could be sold at a higher price.

PROJECT BCONSUMER’S POINT OF VIEW

Consumers may not want an iPad

Consumers may see the appeal in tablets produced by other establishedBrands e.g. Motorola Xoom, Samsung Galaxy Tab, HTC Flyer. These tablets are good in their own right and consumers may pick them overThe iPad.

Consumers may feel that the iPad is unnecessary; they may already own anIphone/iPod touch and may see no use in getting what is an essentiallySupersized version of a product they already possess.

Consumers may be hesitant towards buying an iPad; Apple has the tendencyTo release newer, upgraded versions of their products within 6 months-1 year,Hence consumers may hold out till the next version.

Changes in price of related goods

The emergence of similar tablets gives consumers more choice ,leading to a drop in profits for producers as they face more competition.

Hence, producers should follow closely with the changes in prices of other tablets.

For example, when the price of the Samsung Galaxy decreases, the demand for iPad would drop. Thus it is necessary for producers to adjust the price of iPad with reference to substitutes.

PROJECT Bproducer’s point of view:

Launch of iPad2(more advanced products under the same firm)

The launch of iPad2 at the same price as the iPad will affect iPad sales.

It has enhanced functions and thus more worth it since consumers’ objective is to maximize their satisfaction with their limited income.

Hence producers observing such a trend should halt production for the first generation iPad and ram up productions of iPad2 in order to satisfy the demands of consumers.

PROJECT Bproducer’s point of view:

Launch of iPad2(more advanced products under the same firm)

Since the price of the iPad2 = iPad and is a better version, consumers will want to buy the iPad2

Demand for iPad will fall, demand for iPad2 will increase

Drop in demand for iPad, leftward shift in demand curve(ceterius paribus)

Quantity supplied > quantity demanded

Downward pressure on equilibrium price due to surplus, price drops

PROJECT Bproducer’s point of view:

Apple’s (scheming)marketing strategy

Controlled media leaks

• Every time a new Apple device is on the verge of launch, there will be lots of rumors and speculations from third party sources who claim to be 'in the know' regarding the product.

• This would successfully create buzz for the products and also allows Apple to study the reaction regarding price-points.

Source: http://www.iphonehacks.com/2010/01/apples-strategy-to-generate-buzz-controlled-media-leaks.html

Did you know??

Thank You!