Why are Apple products so expensive

A number of people out there think Apple is an overhyped brand with overpriced products. And Apple users—people who’ll pay anything to own that logo in mindless loyalty and/or for the rep.

While this is of course, not completely true, the steep pricing and luxury image of Apple products do not help matters here. Most of the people that nitpick on Apple feel inclined to do so because everyone’s doing it. Some others however, make sensible argument. And Price is a valid point. The original iPhone cost a mind boggling $499 in 2007. “What the hell” right? Anyways the original iPhone was quite literally a first of it’s kind. A fully touch interface in a sleek new design. Smartphones in general were making a big leap forward and Apple was at the front end of that Revolution. So let’s assume for a moment that their sales were justified then.

Fast forward 10 years. In a tear down test, the hardware components of the iPhone X —which was far from a game changing product—were found to cost less than $400. Yet the phone sold for $1000, clearly overpriced. In the end Apple had to make up for the iPhone X with a much better XS at the same price.

Notwithstanding this incident, Apple products are still on the “darn expensive” side. With plenty of alternatives available, it’s a wonder how a company can continuously charge so heavily for their products—and still keep such a huge customer base. Here’s why their products are really expensive.

The Brand

While the Apple logo in today’s world has become a symbol of well-to-do, it goes much deeper than that. The logo of any company is a representation of the years of work put into building it. Including it’s products, reach and more importantly, customer loyalty. They have built a quality and consistent product lineup, a very respectable name, and a solid consumer base.

Besides Products, what of all those “Today at Apple” events and workshops at iconic Apple stores go a long way to ensure customer loyalty.  And let’s not forget how Long-lasting their Products are. I present two case scenarios. First, this year’s update which was released for even the iPhone 5S. The 5S was released 5 years back. So that’s at least 4 years of support for most Apple devices. Again, the iPhone 6, which still looks, and feels good. So much so that most people don’t even know it has just 1GB of RAM. Die-hard fans comprises people who have gotten used to Apple’s Quality, Software experience, and attention to the very last details—something most other companies take for granted. So for them, it’s worth the extra cost.

High-End Products

Another reason why Apple products are Pricey is the obvious one. Apple products are Premium products. The MacBook for instance boasts a level of build quality you just can’t find elsewhere—The iPhones as well if you’re willing to admit it—As to why iPhones for instance are getting more expensive, it’s also pretty obvious. As Gruber pointed out,

Stainless Steel is more expensive than Aluminum; OLED is more expensive than LCD; Two Cameras are more expensive than one

John Gruber- Daring Fireball

It’s easy to think they are only concerned with the bourgeois class who can dish out huge sums. However that’s not the case as Apple’s attempts to enter into the Mid-range market haven’t gone all too well.

Take the infamous iPhone 5C for instance. You are justified for not even knowing about this model. It was a lower-cost version of the iPhone 5S. With a plastic body rather than the aluminum finish on the 5S. Sales did not go well. Epic fail in that regard. Why? Well you see Apple had built it’s customer base around Premium products. People expect nothing less from them. Samsung and most other companies had Plastic phones too. But they had great sales. Another attempt at entering the Mid-range market was with the iPhone XR. And we’re already hearing of poor sales and price cuts. The Sub-$350 iPad seems to be doing well though.

Apple Ecosystem

There’s a wide range of products the fruit company offers. And because all their software is proprietary, they are able to achieve an amazing cross-platform experience. Stay with me here. Features like handoff allows you to begin taking notes on your iPhone and pick up your iPad or MacBook and continue right off. How about copying a particular text or link on your phone and being able to just hit paste on your Mac. AirDrop allows you to share files across all Apple devices seamlessly and without the need for 3rd party apps. MacOS would soon support iOS apps. The Apple Watch integrates so well with the iPhone—Sharing your cellular plan and allowing intuitive new interactions. There exists no other collection of products so tightly knit.

Actual Cost of Production

Apple, being Apple, gets quite picky about component sourcing. Which is why they produce as much of their components as they can. And they do it ever so well. The A12 chip for instance is just insanely powerful—At least a year ahead of the competition. But then consider the funds sunk into researching these components. In a report from AppleInsider, Apple spends huge amounts in R&D and Manufacturing processes. The parts they can’t produce, they don’t cheap out on. Their specific demands would only lead to constraints in supply. Further raising Manufacturing costs.

And that’s just hardware. Apple also spends a significant amount in software development. iOS, MacOS and WatchOS are proprietary platforms. Services like iCloud and Apple Music as well. Apple has to maintain and update all of these themselves. Unlike other smartphones that can acquire Android OS for free from Google and then tweak it to their needs. Besides, Apple’s software is well known for it’s unrivaled Security and smooth user experience. Someone has to pay for all that.

In the end, as Linus from TechQuickie stated, “Apple uses an interesting combination of product strategy and marketing hype, to keep people coming back for more.”

Love them or hate them, be sure to pull off an enlightened argument next time. Matter of fact, take one up with me in the comment section. Also, did you know Apple may be bringing back Fingerprint Sensors? Read about it here.