Apple lowers the price of the iPhone: is the the price elasticity well utilized?

Apple sold his 1 millionth iPhone. Steve Jobs is happy announcing: "One million iPhone's in 74 days, we needed 2 years to accomplish the same with the iPod". Selling 10 million iPhone's by the end of 2008 is the objective. Apple is looking for new customers with the help of a spectacular price cut. The iPhone was launched at 599 dollar, but since wednesday the phone is available for 399 dollar. Since this price cut Steve Jobs received more than hundreds angry e-mails of dissatisfied customers who paid the 599 dollar. Upon that he decided that Apple will refund 100 dollar to those angry customers. Jobs defended his decision with the argument that with the upcoming end of year festivities the price cut will help to persuade more people to buy the iPhone.

ePP comment: They call this price elasticity... would all the early adopters already have an iPhone? And what does this mean for the European launch?

Apple heeft intussen zijn miljoenste iPhone verkocht. "Een miljoen iPhone's in 74 dagen, met de iPod hadden we daar twee jaar voor nodig", juicht topman Steve Jobs in een mededeling. Tegen het einde van 2008 wil Apple tien miljoen iPhone's hebben verkocht. Apple wil nu een nieuwe golf klanten overhalen met een spectaculaire price cut. De iPhone werd twee maanden geleden gelanceerd voor 599 dollar, maar is sinds woensdag te koop voor 399 dollar. Apple-topman Steve Jobs kreeg na de prijsverlaging honderden mails van boze klanten die het volle pond betaald hadden en besloot daarom tot een compensatie van 100 dollar voor die mensen.Jobs verdedigt de drastische prijsdaling met het argument dat de eindejaarsfeesten er aankomen en een lagere prijs zou veel meer mensen overhalen om de iPhone te kopen.

Prijselasticiteit heet dat…. Zouden alle early adoptors al over de streep zijn ? En wat betekent dit voor de Europese launch ?

Apple Lowers Price Of 8GB IPhone To $399 For Holiday Season

Wednesday, Apple Inc. reported that it lowered the price of its iPhone model with 8GB of storage to $399 from the earlier price of $599. The company noted that the move is part of making iPhone affordable for more customers in the holiday season. Apple expects to sell its one-millionth iPhone before the end of the current month. The iPhone model with 8GB storage will be available for $399 in the US through the company's retail and online stores and AT&T retail stores.

6000 euros for a seat on the Airbus A380

6000 euros is the price for a seat on board during the first A380 flight !

Since yesterday you can buy on eBay seats for the first flight of the Airbus A380, today the highest offer is 8.159 dollar (almost 6.000 euro) for a seat in businessclass. In economyclass somebody wants to pay 5.000 dollar for a seat.

Singapore Airlines will be first to start flights with the superjumbo. The online auction started yesterday and the profits of this auction will be offered to charity projects such as a project with children in two hospitals in Sydney and the international organisation 'Médecins sans frontières'. The auction is running until September 10th. Singapore Airlines ordered 19 airbusses A 380 for which two of them delivery is delayed with two years.

Singapore Airlines zal als eerste de superjumbo inzetten op 25 oktober van dit jaar tussen Sydney en Singapore. De onlineveiling startte gisteren. De opbrengst zal geschonken worden aan liefdadigheidsprojecten zoals onder meer een project met kinderen in twee ziekenhuizen in Sydney en de internationale organisatie Médecins sans frontières. De veiling loopt af op 10 september.Singapore Airlines bestelde negentien Airbussen A380 waarvan de levering met twee jaar werd uitgesteld.

Source: afp/hln

Be careful with discount pricing

Companies use discount pricing for many reasons: To stimulate short- term sales; to match a competitor's price reductions; to get high-traffic display space at a major retailer.

But before you slash your price, consider the impact this could have on customer loyalty. Wander down a supermarket soft drink aisle, and you're likely to notice Coke or Pepsi is on sale at a reduced price. These sales have become so common that most consumers either wait for the brand they want to go on sale or buy the competing brand that is on sale.

"The loyalty factor is a very important reason not to compromise pricing or over-use promotional pricing," explains Michael Goodman

Why? If a customer is more loyal to price than to your brand, your brand is vulnerable to pricing moves by your competition, and you may be forced to cut your price—and your margins—in order to maintain your market position. What are the alternatives?

• Offer a bonus pack. Use creative packaging to demonstrate the additional benefit the consumer is receiving.
• Offer a free premium like McDonald's does with the Happy Meal. Offer a purchase with purchase. "Buy a designer label fragrance at the regular price, and get a $59 silk scarf for just $9 more."
• Offer a free month of services for a yearly retainer.

The Po!nt: There are many ways to earn customer loyalty and increase sales. Discount pricing is but one, and it can backfire in the long term.

Fine for Leonidas in France

The Belgian bonbon producer Leonidas has to pay a € 120.000 fine for the violation of the free competition law. Leonidas forced the French retailers to buy the chocolate and bonbons from a specific distributor. This is a flagrant violoation to the free competition law. It was the French minister of Economics that asked for the investigation.

De Belgische pralinefabrikant Leonidas moet aan € 120.000 boete betalen voor de overtreding van de wet op de vrije concurrentie. Leonidas had Franse detailhandelaars verplicht om zijn chocolade en pralines bij een welbepaalde verdeler te kopen, wat volgens de Franse marktregulator een flagrante inbreuk op de vrije concurrentie betekent. Het onderzoek kwam er op verzoek van de Franse minister van Economie.

Bron: De Tijd