Why Removing Chargers And Earpods From iPhone 12, Is The Ultimate Marketing Move
The news dropped like a bomb in the tech-savvy world as if a wave of insanity appeared and sweapt away everything we had for granted till now. The new iPhone 12 is coming out but it won’t have a charger, Earpods, or any other accessory from those we were so used to get in similar gadgets, especially in the phones that their price was superseding the 1000$ mark. The move comes in contrast to all the competitive brands that not only offer all these extra pieces of equipment but also raise the stakes even higher by delivering protection cases and power adapters.
The initial excuse was that this way they would lower the environmental impact, by reducing the use of plastic for all the people that have already a charger and wouldn’t really need a new one. A sneaky move meant to influence you into thinking that they are actually apologizing for something they know is wrong. They took something away from the customers and try to justify it, in any way they can. But this is only a mere little card-trick made by a magician that actually has bigger scopes to aim at. A company at the size of Apple would never risk alienating her audience for something so cheap as a charger. They get multiples of its value bundled with the money that is paid for the phone per se when the actual cost of an iPhone is less than half the price that is paid.
The move is not aiming at cost-efficiency or profitability but in Marketing and establishing the ‘grand importance’ of the phone. Marketing is any technique that can vividly showcase the quality of a product and the value it can offer to customers. If you add 10 light projectors surrounding a single item while having cameras and journalists queuing up to take a photograph, you will naturally assume that this item is of some importance. If you see someone lightly caress the suede fabric, of a little case as he slowly opens it and admires the content like it is pure gold, you will naturally elevate whatever opinion you might be holding for that item whether it is a conscious process in you or not. Marketing is all about manipulating the image you have about a product and how it is perceived by the bigger audience in terms of value.
Funny enough price per se is an actual factor of marketing that can be manipulated to change this value perception as well. In the book “Influence: The Psychology of Persuasion”, Robert Cialdini describes how a seemingly incohesive move could raise the sales of a product when it was previously plummeting its position in the market. He observed that in some cases, all you had to do was to raise the price of the product twice or even multiple times the previous mark, just to see all sales sky-rocketing.
There are mainly two reasons for this behavior. For one thing, any item in the range of high prices means it is scarce. It is by design, meant to exist only for very few people the same way art painting can get so expensive. They become a badge of honor denoting your worthiness to have one of these rare objects that the rest cannot afford.
In a similar way, we can see the price in more general terms as the value that other people project into a product and what is their estimation about its worth. A high price means it something of value and can affect us by the rule of the social impact it has.
So imagine a phone that comes at the price of 200$, equipped with chargers, cases, and free service on anything that might happen to it for a few years. They try to make sure that they keep a happy customer and they provide everything that might be needed to achieve it.
On the other side of the spectrum, you have a glossy, shiny phone at the price of 1200$, that comes with its box along. It contains nothing else but the phone and you can thank them that you were even allowed to buy one of those.
What phone would you choose? Obviously, had you been known that this is just a marketing trick the choice for the bigger audience would be straightforward. But all these subliminal messages are most of the time hidden and only manifest by the general impact they have on the broader spectrum of audience.
Apple has created an ecosystem where its products are manifesting as valuable only to generate their reach through the network effect. They work more like a decoration where the idea of owning one, far exceeds the actual value you get out of them.
This is where the idea of a luxury good comes from. They exist within a hierarchy of objects where at its base sit objects of necessity and they go all the way up to things that may still offer the same thing but in slightly better quality. You can still have a car you can use to move within a city no matter if you own a Lamborghini or a Fiat. You can still have a watch, whether you own one with a cheap plastic bracelet or a golden one, decorated with diamonds on top. The difference is that through their slight differences in quality and the higher demand for them their price has risen to the level of scarcity that surrounds them for the people. Owning one of them, decalres that you are among the very few people that have enough money at their disposal to afford them in the first place. Through their hierarchy among other products, we associate our hierarchy among us that separate the various classes.
Scarcity and Price
As is always the case with products, scarcity affects the price of a commodity to higher levels. Through the laws of supply and demand, it is a deterministic consequence that the less there is of something, the higher the price will get as more people will request a chunk of the limited amount that exists and will be willing to pay a higher price. Yet supply is a double-edged arrow that can play out in a bi-directional way and affect demand itself on its own. As it turns out, believing something is scarce is a natural way to drive the demand higher.
“Consumers place a higher value on goods that are scarce than on goods that are abundant. Psychologists note that when a good or service is perceived to be scarce, people want it more.” — Investopedia
By raising the prices so high, iPhone can simulate the effect of the product being scarce in a conceptual way, and not eligible for the bigger range of people. Their marketing strategy can persuade that the demand is high enough to be in a position to take an atrocious act like that without batting an eye thus re-enforcing the fact that they have a great product in place and multiple people want it.
Scarcity can play out in multiple ways in markets. Many products have started off by adopting a strategy of limited access, by accepting only people with invites, as for example Google Plus or RobinHood had in their initial stage. This restricted access amplified the feeling of scarcity in a way to make people want it more and drive them stronger towards trying to find a way in.
This tactic is employed very carefully, in a way that is creating what is known as the “snob effect”. It describes the situation where the demand for exclusivity is attained by the high prices per se.
“This situation is derived by the desire to own unusual, expensive or unique goods. For consumers who want to use exclusive products, price is quality. These goods usually have a high economic value, but low practical value. The less of an item available, the higher its snob value. Examples of such items with general snob value are rare works of art, designer clothing, and sports cars.” — Wikipedia