Not necessarily. Take our case of the iPad. It came out at a time when netbooks had created a new low for computer pricing. The iPad lacked a keyboard, a proper/large HDD, had a processor that was even slower, ran a smartphone OS that couldn't even multi-task properly, and had a screen resolution right out of 1995. The 'logical' price for this would have been $200-300; pretty much the only hardware that was not a cost reduction on a netbook was the (low cost) touch layer. Yet it had excellent customer satisfaction. They created perceived value- lacking USB, storage expansion and replaceable battery were all practical disadvantages-- but these weren't things that created desire like the buttery-smooth operation provided by the GPU and capacitive touch, the large viewing angle from the IPS screen, the sleekness from having just one button etc, and the light and slimness gained by forgoing so many features available in even a netbook.
And it's not just something like apple does. Think of a tech 'consultant', or a fashionable web-design company. Chances are you see their prices and think 'WTF are they smoking'..I could have better than that done for me for 10x less. but their clients, i bet are pretty happy. Because of the value they offer-- some perceived, some reality.
Not necessarily. Take our case of the iPad. It came out at a time when netbooks had created a new low for computer pricing. The iPad lacked a keyboard, a proper/large HDD, had a processor that was even slower, ran a smartphone OS that couldn't even multi-task properly, and had a screen resolution right out of 1995. The 'logical' price for this would have been $200-300; pretty much the only hardware that was not a cost reduction on a netbook was the (low cost) touch layer. Yet it had excellent customer satisfaction. They created perceived value- lacking USB, storage expansion and replaceable battery were all practical disadvantages-- but these weren't things that created desire like the buttery-smooth operation provided by the GPU and capacitive touch, the large viewing angle from the IPS screen, the sleekness from having just one button etc, and the light and slimness gained by forgoing so many features available in even a netbook.
And it's not just something like apple does. Think of a tech 'consultant', or a fashionable web-design company. Chances are you see their prices and think 'WTF are they smoking'..I could have better than that done for me for 10x less. but their clients, i bet are pretty happy. Because of the value they offer-- some perceived, some reality.