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IPhone 5, Essay Example

Pages: 1

Words: 420

Essay

Our experiences as well as marketing principles dictate that companies with high consumer loyalty rates charge premium prices due to their pricing power and Apple is no different.Apple has built its reputation on products that have not only been technologically more innovative than the competition but also provide better user experience. Thus, the question is not whether iPhone 5 should be priced above competitors’ offerings but whether iPhone 5 offers better value proposition than the competition when prices are compared against the product features. Our analysis indicates that the competition is finally catching up and iPhone 5’s price doesn’t offer a better value proposition than the competition.

As we compare iPhone 5 features to its closest competitor Samsung Galaxy S III, we discover that they both almost present similar value. iPhone 5 may be lighter by 21g but Galaxy S III offers a screen that is 0.8 inches bigger. iPhone 5 does compensate for smaller screen size by offering a slightly better screen resolution than Galaxy S III. iPhone 5’s battery is built-in while Galaxy S III’s battery is removable. In terms of storage, both models offer same options from 16 GB to 64 GB. Both models capture video at 1080p(Molen).The features’ comparison proves that both iPhone 5 and Galaxy S III are quite similar in features. Even CNET’s product reviewers admitted that iPhone product line faces the stiffest competition ever. They narrowly chose iPhone 5 over Galaxy S III and Nokia’s Lumia 920, primarily on the basis of hardware and software reliability of iPhone 5 but they did credit the competition for catching up in terms of features (Bennett and Dolcourt).

But what makes iPhone 5 not worth purchasing is the price premium. Samsung Galaxy S III’s current price is $150 cheaper than the expected price of a similar iPhone 5 model for an unlocked model and the difference will become even greater due to price markdowns once iPhone 5 hits the market (PopHerald). This means iPhone 5 is at least 25 percent more expensive than its closest competitor while offering quite similar features. This difference makes it a poor bargain also because the product life cycle in the smart phone industry are increasingly getting shorter.

References

Bennett, Brian and Jessica Dolcourt. iPhone 5 vs. Galaxy S3 vs. Lumia 920: By the numbers. 12 September 2012. 18 September 2012 <http://reviews.cnet.com/8301-19512_7-57510802-233/iphone-5-vs-galaxy-s3-vs-lumia-920-by-the-numbers/>.

Molen, Brad. iPhone 5 vs the competition: fight! 12 September 2012. 18 September 2012 <http://www.engadget.com/2012/09/12/iphone-5-vs-the-competition-fight/>.

PopHerald. Samsung Galaxy S3 vs iPhone 5 in the “unlocked” price tag category. 18 September 2012. 18 September 2012 <http://www.popherald.com/20120918_galaxy_s3_vs_iphone_5_samsung_apple_price-198612>.

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