IPad Market How has the iPad market changed? How will it affect you as an economic student?
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Transcript of IPad Market How has the iPad market changed? How will it affect you as an economic student?
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iPad Market
How has the iPad market changed?How will it affect you as an economic student?
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Brief Facts about the iPad
It has a large screen Camera on both sides to allow facebook video
calling etc LED-backlit display for graphic purposes Multi-Touch Advanced mobile operating system Originated in April 2010 (appeared in market)
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How is the price of iPad determined?
Determined by the interaction of supply and demand curve
Intersection between these two curve provides us with the equilibrium point
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Gradient of demand curve
Many substitutes of iPad available Large proportion of income spent (around
$SGD 600-900) Luxury good Demand for iPad is price elastic Gradient - Gentle
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Gradient of Supply curve
Easily stored Luxury good Easily transported Supply for iPad is price elastic Gradient- Gentle
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Graph of price against quantity of iPad
Combination of demand + supply curve
Intersection at (Q1,P1)
P1 is equilibrium price Q1 is equilibrium
quantity
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Price of iPad determined
The intersection between demand and supply curve
Demand = Supply Market equilibrium Price of iPad determined by intersection
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Related products of iPad
Complements (paid applications, iPad cover etc) :D
Substitutes (Samsung galaxy tab, net books) D:
Different type of relationship with iPad
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Complements
Products that complement each other and have a positive relation
Increase in demand for iPad would cause an increase in demand for paid applications
Cross elasticity demand (XED) value is always negative for complements
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Substitutes
Products that act as sub have inverse relationship with each other
Decrease demand for iPad can cause an increase in demand for sub
iPad 2, an extremely close sub of iPad XED value is positive
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Recent Developments
Changing Taste of Consumers (Consumer POV)
Earthquake in Japan (Consumer POV) Conflict in Arab Countries (Producer POV) Introduction of iPad 2- Changing prices of
related goods (Producer POV)
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Changing Taste of Consumers
Introduction of iPad 2 Better features (graphic) than iPad Consumer prefer iPad 2 instead Demand for iPad decreases
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Earthquake in Japan
Severely affected the income of Japan people
Necessities become top priority according to Maslow hierarchy of needs
iPad is a luxury good Decrease in demand for iPad
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Conflict in Arab Countries
War in Arab countries increased prices of oil
Cost of production increased Total revenue being constant as price is
fixed Total profit decreases Supply for iPad decreases
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Introduction of iPad 2
Released recently, 11 March in US Better features Consumers cast higher dollar votes for iPad 2 Prices of iPad 2 increases iPad and iPad 2 in competitive supply More resources allocated to iPad 2 Reduces supply of iPad
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How does recent development affect marketing and price decisions? Recent developments caused decrease in
supply/demand of iPad iPad market reaching saturation iPad market no longer profitable
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Life cycle of iPad
iPad life cycle stage is near the decline portion
Decline occurs due to presence of better products and changes in consumer taste
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How does recent development affect marketing and price decisions? iPad market is declining In response, decrease price of iPad Increases the current sale of iPad Marketing iPad would be irrational Presence of better products (iPad 2)
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Conclusion
Market of iPad is declining Demand for iPad is reducing Producers should discontinue producing
iPad Not profitable in the long run Should venture into new markets, (iPad 2
which is profitable now)
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Credits
http://www.seattlemet.com/blogs/culture-fiend/archives/2009-07/2009-08/ http://hothardware.com/News/Are-Tablet-PCs-Killing-The-Netbook-Maybe/ http://androidmeup.com/articles/samsung-galaxy-tab-hopefully-an-ipad-killer http://jessieshare.wordpress.com/2010/07/28/cyber-acoustics-launched-
portfolio-cover-leather-case-for-ipad/ http://www.shuttervoice.com/9473/ipad-applications-make-your-tablet-
device-useful-for-you.html http://www.crunchgear.com/tag/ipad-2/ http://www.themoneytimes.com/articles/20081126/
latest_report_shows_cancer_cases_in_the_united_states_is_decreasing-id-1042640.html
http://support.easyonlinecare.com/earthquakes-in-arkansas http://alansmoneyblog.com/2008/05/22/oil-smashes-135-per-barrel/
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Thank You!
Thank you for your kind attention Hope you understand the iPad market
better Have a great day :D