One of the constants when the new iPhone models are launched is, in addition to an overwhelming media coverage that makes the terminal be in practically any medium that covers practically anything, is that the prices that will accompany the launch will be very high. IPhones are very high-end terminals, for which consumers are willing to pay very high amounts. Part of the experience of buying an iPhone and having one of these devices is, in fact, paying a very high amount for it (and it was this that made, in countries like China, these terminals became aspirational products), But is a product really being paid for or a brand being paid for?
An analysis firm, IHS Markit, has just made an exploded view of the iPhone 7 to determine how much it costs to do so and how much Apple achieves, therefore, to earn with each of its terminals. The cheapest of the iPhone 7 models costs $ 649, while making it only costs $ 225 (220 for parts and $ 5 for assembly). What is the conclusion that can be drawn from these numbers? As they point out in Quartz, making the iPhone only costs a third of what Apple spends to make it.
The version of the iPhone 7 is, however, one of the most expensive of all versions of the iPhone in terms of cost to Apple. It is only beaten by the iPhone 6S Plus, which cost Apple $ 236, followed by the original iPhone ($ 217.73) and the iPhone 6 Plus ($ 215.6). The rise in the cost of these terminals and especially the iPhone 7 is due to the technical improvements that were included in them. The iPhone 7 screen is brighter and more efficient, while the terminal itself has a higher initial storage capacity. All this makes the device a bit more expensive for Apple.
And, although the cost price is high (in Quartz they wonder how Apple will have spent so much money on a terminal in these times) and although to all this we must add other product costs (such as investment in marketing) For the consumer, the question will only remain that he is paying three times more than what Apple has to pay to manufacture its next-generation iPhone.
If to this is added that, when the terminal appeared and its improvements were announced, many critics commented that it was not really that bad and that many of the things that the new iPhone had already had a few Android terminals for a long time, the question becomes much more interesting. Why do you pay so much money for that high-end terminal?
What you pay is the brand
Consumers don’t just buy a terminal, they buy an Apple terminal. What causes high amounts of money to be disbursed in the terminal is that it guarantees access to the Apple experience, it makes it possible to enter that club of consumers who consume the brand and who are made with the products of the same.
The key is in the power of the Apple brand and in the work that has been done in recent years. Apple associates itself with certain values and certain realities, and its products associate itself with these elements. The consumer is not paying for a next-generation smartphone that can do this and that, but rather the latest Apple terminal and the company’s latest next-generation device.
But will this continue to work?
Continuing to bet on all of this might, however, not be as safe as it might seem, as the Apple brand is losing some of its luster as of late. In fact, there are those who are beginning to point out that Apple has begun to become a boring brand, that in reality it does nothing more than present the same product over and over again with few improvements and variations and that it has stopped having that claw of mystery and surprise that I had a few years ago.
Apple is ceasing to be the brand that took the market by storm and changed it from top to bottom. Apple has started to stop sounding different. For some analysts, Apple is starting to stop being cool and stop being the coolest brand on the market, as the latest financial results show.