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> and tries to maximize dollars per unit. I've never really understood this line as applied to Apple, since I don't recall them dropping prices after the initi

• Steko 15y ago
  There's no guarantee that supply increases indefinitely. At some point it will negatively affect your margin per unit. Until you get to that point I guess the goal is to manage demand by staggering releases to different areas and segments. Even so sometimes your margin goes down but the consumer price is the same like when Apple expanded ipad sales thru Walmart/Best Buy/Target/whoever 6 months after the ipad launched when their supply started to ramp up. Their margin for an ipad at Best Buy is what 15% lower then if they sell it direct but the customer pays the same price.
  • objclxt 15y ago
    ...than if they sell it direct through the online store, perhaps. I would imagine the overall margins to Apple on an iPad sold in a Best Buy and an iPad sold in an Apple Store are similar, because Apple Stores are typically located on extremely expensive real estate and have much higher running costs than Best Buy stores. Apple obviously would prefer you to buy it in an Apple Store, because they have more control over the consumer relationship and experience - but running a physical retail store is not cheap, and that's a cost Apple has to cover if they sell direct, which they don't if they sell via Best Buy.