While the twitter chatter is making me eat my words about the piece on iPad not coming to India (I wasn’t entirely off target either), the market situation makes me ponder of a particularly crucial aspect of gadget sales (especially high-end!): The Pricing! The Apple iPad has landed at a price of Rs 27900, and that’s surely makes it an attractive buy for many. But what disturbs me is the drastic price fall of the Samsung Galaxy Tab. The Galaxy Tab started to retail for Rs 38000 on November 10th and on 23rd Jan we reported the same being on sale for Rs 27999!
That’s, a fall of Rs 10,000 in less than 3 months. Even if you go by company quote it’s a fall of Rs 8000, with the current pricing at Rs 29999. On the flip side, I know that the iPad has been on sale in US for $499+taxes since April last year and its still priced at the same level. Isn’t that a gesture by Apple that commands trust? Over years, I have started to believe that making friends with your customers pays rich dividends. Apple has few products out there, but they sell a hell lot of them, and perhaps at a little premium. But are the 150 million iOS buyers complaining? No!
If I was a buyer of the Galaxy Tab, I would certainly be in tears, and that surely doesn’t make me a Samsung loyalist, does it? We have seen many more such cases, the N8 was one. Within days of the release, the piece fell from Rs 26000 mark to Rs 22xxx. That was again a drop of over 10% and enough to annoy the early adopters.
The companies may make some quick bucks with this strategy, but does this help them in the long run? India is a developing market and the early adopters (who are currently paying a premium to get the gadget as soon as it launches) are the ones who evangelize technology, brands and trends. Do you expect them to recommend your product to their followers? When they know that you will leave most of them in an unpleasant taste just a few months down the line!
It’s not just the price drop, but rather the steep pricing upon launch that annoys me. I didn’t buy a Galaxy Tab or the N8, and it’s not even about these two products. This is an age old phenomenon in India (and I believe across the globe too), where within months of a product launch or after en cashing the holiday season rush, manufacturers announce heavy price drops.
As a consumer, I would be hesitant to adopt new releases, solely because of the pricing uncertainties! The industry as it is moves fast and gives enough reasons to wait for upcoming releases from other players, in addition to that if you as a Brand would scare me off with such steep price drops, dear manufacture – You better give me a refund to keep me happy!
Price drop according to new technology evolution can be understandable …. but price drop according to high product sale or same typo product launch of rival manufacturer; that’s not fare enough indeed…