Thursday, June 16, 2005

Apple's Pricing Gets A Bad Rapt?

Mac fanatics get overwhelmed with emotion when someone dares to say "Macs are more expensive than PCs". We tend to go into this raging state and proclaim, "Macs are cheaper, because of the long term value, there's no "virus tax", and feature for feature, Apple has higher quality than budget PCs."

Rapt, creator of technology hardware & software pricing solutions, indicated being hired by Apple to help with pricing structure for Apple's products (Macs, Laptops, iPods, Software).

Rapt's Price Director software is used at Hewlett-Packard and Yahoo; to name two.

Seems this company's software looks at similar pricing around the retail channel from 100's of sources, takes your "bring to market cost" into account and helps you price your products accordingly (and competively) on the fly. In other words, if Apple's iMac were $1299.99 and a comparitively outfitted PC were $1239.99 - Apple would know that it may want to adjust the price to meet competitive pricing demands. Similarly, it can also analyse your own channel to see what your distributors are charging for your product. Apple will most likely be using this software for deployment in Apple Stores some time soon.

As Apple grows it will start to see more and more pricing pressure. At the moment, it is the darling of Wallstreet for it's historically high margins. No other computer maker even comes close to Apple's margins - which on some products exceed 30% - whereas the rest of the industry (both computer and MP3 player markets) enjoys 4%-11% - if they are lucky!

And just for my own comfort ... can someone please explain the RAPT logo? Does the guy in the logo have arms growing from his hip and leg?

No comments: