Weekend Read: Does Steve Jobs Hate Poor People?

Authored by Scott Goldberg on March 30, 2007 - 3:59pm.
Steve Jobs Headshot Here’s a lesson from The Steve Jobs School of Marketing: You need to get rich people to buy your stuff if you want to sell a lot shizznit.  What’s with this dude and expensive gear?  Well the answer’s pretty easy: You can’t claim something’s new and cool if it doesn’t cost a shit load, correct?

Not entirely.  Take the Wii.  That’s certainly new and cool, and a lot cheaper than the PS3 and Xbox 360. 


Some would argue the Wii’s a novelty, though.  It’s certainly original, but the capacity for dynamic looking games isn’t there.  Basically it’s the Mini Cooper of gaming consoles.


Apple, on the other hand, isn’t just in the business of originality; it’s in the business of really luxurious originality.  And for that, you can’t sell it cheap. 


Look at Apple’s last four major product launches: The iPod, the Mac desktops/laptops, AppleTV, and the forthcoming iPhone.  All of them are pricey; all of them have a lot of hype. 


But Jobs knows the balancing act: You need to make a product expensive enough for people to discuss it, but not too expensive to turn them off.  Large prices should be an advantage, in fact.  People should coo at the thought of a $500 phone smaller than an Eskimo Pie in their hand, yet they should question whether they can have it. 


You don’t start the “It” club in New York by letting everyone in the door and hosting post-work Happy Hours, in other words.  You keep the numbers inside small and let people wait.  Lines = Desirability. 


The line can’t be made of Average Joes, however.  You need rich and famous Average Joes…people as equally willing to walk a flight of stairs as they are to buy a $200 headband.


Granted that’s backfired on a company now and then…a certain game console producer named Sony, no less, whose executives appear to have attended The Steve Jobs School of Marketing, but failed to graduate.


The PS3 was original, it was cool, it was luxurious, it was pricey, and it was difficult to get.  So wha happen?


It had no juice, no games.  The software sucked.  Steve Jobs would eat his own ears if he knew a disciple was planning a product launch with no juice.


See Jobs isn’t just about price and originality and sizzle.  He’s about delivery.  He knows rich people are willing to pay high prices, but only if they’ll get follow-through.  Whether it’s a hotel, a car, or a latte, they’ll pay the price if the shit’s good.  In fact they’ll buy something they don’t even need, like a designer scarf for their poodle, if they know there’s good juice. 


Jobs has turned Apple into a follow-through machine.  That’s why it’s on every analyst’s must-own list: You can rely on it to set the bar higher for whatever category they’re entering.  And for that, yes, you can charge a pretty penny.


So maybe Steve Jobs doesn’t hate poor people, but he sure doesn’t care about selling them his stuff either.  Trends aren’t built that way.



Scott Goldberg


Related Link:
As if the point needed to be further driven home by relevant evidence, check out the latest from MacDailyNews: Steve Jobs presents first iPhone to Madonna?

Comments

I like Mac's But DAM the price ?!

I had a Power Mac G5 for a week or so but it just couldnt compete with my cheapo PC. Power Mac $2000 - Cheapo PC $700 = Hmmm, What would Jesus do?

That's one school of

That's one school of thought. The other is: Steve Jobs prices hardware with a 20-22% profit margin, and has since his return to Apple.

You're confusing value with

You're confusing value with price and EVERYONE has different pricing schemes at different times of the day & year. What is a WII worth on December 23 if you have kids or conversely on December 26th? While a WII is cheaper, it does offer less functionality - it doesn't play movies - of course, for you that value might be scaled differently than the next guy. You also have to figure that even buying a WII means you have a TV, electricity, probably a second controller and later on, more games - so the true buy-in gfopr a WII is really? $1,000? $1,500? Again, I'm not saying it's expensive or not. We might buy a new Ferrari is someone offered it to us at $5k but ask a Buddist monk in the Himilayas if he wants it, he'll just shake his head. Hust as someone who does not listen to music, they wouldn't spend $1 if you offerd him an ipod versus someone who values music and portability who is more than willing to spend it - what Apple also promises you is good value for your money. Unlike a cheap mp3 player from Bulgaria for $29, you know there's value in Apple products - so it's not always about how much it costs now but what is the true cost to you in terms of function & use. I can sell you $1 million dollars in alien abduction insurance for $19.99 - is that really money well spent? It is "cheap" - but I'm guessing that's not the only criteria you personaly use in buying things.

Apple's products are priced competitively

What are you talking about? Poor people can't afford internet access let alone a computer. Dell sells cheap computers at less than cost. The on board craplets help make up the difference. Still, Dell is losing money big time on their low end lines. Microsoft sells Xbox 360 at less than cost. Does that make business sense? The games for it are overpriced but they still lose money on the Xbox. Actually Microsoft loses money on everything it does except for Windows and Office. Apple sells medium to high end computers and MP3 players at a fair profit and at close to or less than what their competition sells theirs. If you can afford a cheap Dell with Windows or a cheap MP3 player that you can't load music on then you can afford Apple products. Apple products are cheaper in the long run.

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