buy an essay on iPad

1. Prepare a table showing the prices being charged now for the different iPad models currently offered for sale.
Technology / capacity 16GB 32GB 64GB
Wi-Fi $499.00 $599.00 $699.00
Wi-Fi + 3G $629.00 $729.00 $829.00
Table 1. iPad pricing (Apple Store, 2010)
2. Assess the potential cost of ownership for potential buyers of an iPad: Calculate the likely cost of ownership for a buyer of an iPad over the first year of ownership. Compare Wi-Fi only with Wi-Fi+3G models and make assumptions about the number of apps, books, data, accessories and other items an owner might purchase or use the product for, e.g. consider a buyer of an iPad who is a “light user” versus a buyer who is a “heavy user”. Make clear how you have defined “light” and “heavy” user.
First of all, it is necessary to distinguish between “light” and “heavy” users. Light users are the ones that use iPad either not frequently or mostly for certain purpose (working, taking notes, listening to music etc.). Light users are not likely to be devoted fans of Apple devices, and focus at the functionality of iPad. In addition to that, light users either do not stress being online and available all the time, or do not move from one place to another often.
Heavy users can be divided into several categories. First category includes great fans of Apple production that tend to buy new devices, accessories and try out new features offered by Apple. Kids and young people who prefer Apple, spend much time online, use lots of multimedia content and need to stay available 24/7 can also be included into this group. Secondly, the users actively using iPad during the whole day, traveling and communicating a lot, or using iPad as the replacement of laptop, smartphone and PC, can be referred to as heavy users.
Concerning Apple products, it should be noted: these products’ design implies that customers will buy additional products, be it software, accessories or content. For light users, it is likely that they buy some accessories like keyboard, camera connection kit or earphones. Most probably, light user will buy 1 or 2 accessories per year (approximately $50). Since light users only tend to use internet from time to time, they will choose economic tariffs from their providers, these tariffs can be estimated as $10-$20 per month. Average annual spending on web access can be estimated as $180. Also, it is likely that light users buy several iPhone applications (2 annually) and will be likely to buy content from time to time. Light users are not supposed to use iPad as substitute for their mobile phone, laptops and PC’s; thus, their expenses on content and software tend to be small. It’s possible to estimate all annual spending of a light user on content and software as $25. Totally, ownership cost for a light user is $255 on iPad annually, if separate internet connection is bought and about $75, if the user has existing Wi-Fi connection and will connect iPad to this network (Biersdorfer & Pogue, 2010).
Heavy users will naturally spend more on their iPads. First of all, a heavy iPad user will most probably buy about 4-5 iPad accessories during the first year of usage. The cost of these accessories can be estimated as $200. Heavy users require active internet connection with unlimited traffic, which will cost about $40-50 per month, and about $15-30 for 3G coverage. These numbers might vary in different regions, but average cost of internet connection per year can be estimated as $750. Since heavy users tend to buy various applications for their needs (about 20-25 applications per year), and purchase content at iTunes and similar online stores ($50 per month supposed), their annual cost of software and content will constitute $650. Thus, annual ownership cost for heavy iPad users can be evaluated as $1600.
3. Assume that you are in charge of the pricing of the iPad models. Explain what methods are open to you to price your products and the factors that you should take into account in deciding on these prices. Recommend a pricing method for Apple to use.
Generally, pricing methods are divided into two categories: cost-based and market-based (Cant & Strydom & Jooste, 2009). Apple uses market-based methods for pricing their products, basing on the value that their devices bring to customers and on strong branding as well as high quality positioning. This pricing strategy appeared to be quite successful for Apple, and it is also applied to iPads.
However, there are several recommendations for Apple pricing of iPads. First of all, Macs and iPhones really bring great value and functionality to their customers, offering user friendly features and large scope of application. iPhones do have certain disadvantages, but their variety of functions overcomes these disadvantages.
Concerning iPads, the policy needs to be more customer-oriented than value and image-oriented. The thing is that iPads can easily be replaced with more functional and compatible PC’s, laptops or netbooks (Kelley, 2010), and those users who pay attention to price and service, might decide not to choose iPads due to relatively high price, and the need to buy accessories. In my opinion, some of the accessories are really essential, such as earphones, camera connection kit etc. Also, 16Gb iPads will most probably experience a decline in sales (Kelley, 2010), since for now this capacity is not enough for most people.
Thus, it can be recommended to test “fair price” of the market for single iPad devices after the first rush ends. It will be useful to sell iPads in “boxed” pack with all the accessories. It can be also convenient to offer free internet or 3g access package for a certain period of time, or free access to web store content at slightly higher price. These measures will stimulate indecisive customers to choose iPads rather than their competitors.

References
Apple Store. iPad. (2010). Available from http://store.apple.com/us/browse/home/shop_ipad/family/ipad?mco=OTY2ODA0NQ, accessed at October 9, 2010.
Biersdorfer, J.D. & Pogue, David. (2010). IPad: The Missing Manual. O’Reilly Media, Inc.
Cant, M.C. & Strydom, J.W. & Jooste, C.J. (2009). Marketing Management. Juta and Company Ltd.
Kelley, Braden. (2010). Stoking Your Innovation Bonfire: A Roadmap to a Sustainable Culture of Ingenuity and Purpose. John Wiley and Sons.