Information asymmetry on example of Apple

3

October

2021

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Although nowadays all companies should report back about technical parameters and specifications to such institutions as FCC, CE, PCT etc., it seems like the product marketing is not regulated this strictly. This, in turn, arises the problem of information asymmetry and customer misunderstanding. The concept means that among two parties, let’s say customer and a commercial organisation, the latter possess more information on a product or service. As a result, it leads to an imbalance or exploitation among in this relationships and may have severe consequences.

The brightest example I can come up with is iPhones (actually all the other Apple products, but in this blog post I would like to focus on one product). When you go to check out the battery life of the newest iPhone 13, you see something like “Video playback:

– Up to 17 hours” and “Audio playback:

Up to 55 hours” what are these measures? How many hours of music playback does it take to call grandma or should I calculate all the 15-seconds videos I watch on TikTok to get the battery size?

In a normal life you measure a battery life by mAh, like all the Apple’s rivals do. In my personal opinion, Apple does not specify or provide the specific information on their website or ads, as it is usually smaller in Cupertino’s products. 

And what we have at the end? A customer that can only imagine amount of music they can listen to. Obviously, they can check regulatory institutions or bloggers, whose interest lies in covering and providing related information on those details. However, it is some other kind of a research, while Apple is always possess the complete information on battery, showing consumers only the fruity parts of the product.

However, battery specification is not the only case here, for instance, same iPad models have different RAM values, depending only on the size of build in storage, imagine that the only way to check it out is to use regulatory database. Therefore, the conclusion is that Apple benefits of the information asymmetry framework, selling and promoting their consumers only a part of the information, while possessing with a full knowledge of a particular product.

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Apple’s Versioning Strategy Upgrade

18

September

2021

5/5 (1)

Apple fixed its versioning problem with iPhone 13.

Since 2018 Apple started to release two versions of iPhone yearly, cheaper and high-end models, they continued this practice in 2019, and climaxed in 2020 with 12 and 12 Pro. 

iPhone 12 and 12 Pro had exactly same form factors, dimensions and displays. Both models also shared processors and other hardware. The only differentiator was telephoto camera lens, but let’s be honest, when was the last time you used portrait mode? 

It made Apple’s customer wonder, is it worth to spend another 3 hundred euros for an extra camera that won’t be used daily. The problem occurred due to the lack of knowledge about how consumers value the product as well as what they are willing to pay for it. Apple’s inability to provide high quality and proper versions of iPhone created a gap between consumers value and Apple’s understanding of this value.

But this year with the release of iPhone 13 line up, Apple fixed this problem and added killing differentiation feature and couple smaller ones. 

Worth to say that both 13 and 13 Pro are still in the same design and form factors, cheap version is still in a lack of telephoto camera. However, this year Pro version also learned to zoom pictures a bit more. In addition, there is longer battery life, by adding another 30 grams to its mass. Still no intend to pay more, right?

So, Apple finally added 120 Hz refresh rate display in pro version. Not going to judge about it being the best implementation comparing to competitors. But, 120 Hz display compares with 60 Hz, as your flat TV compares to your grandmas old fat TV set. 

Apple implemented technology in all features and applications, so you will really feel this feature every time you use your phone, or better say every time you are not using 120 Hz display. 

To conclude, Apple learned its lessons and evolved in one year from only camera differentiator, to camera, longer battery life and a killing, best on the market display. In this case, consumers get exact products, and if you pay 3 hundred euros, you get much better day to day usage experience.

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