Apple – thinking inside the box or unplugging from reality?

Introduction:
Apple is an American multinational technology company specializing mostly in electronics
and software. It is currently the largest IT company by revenue and second most valuable
company overall. It was founded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne.
Apple is mostly known for producing good quality, aesthetically pleasing phones and
computers called iPhones, MacBooks and iMacs all branded with the infamous apple logo.
What they are also know for is their high prices which is what makes their products
exclusive and desirable, at the same time making their customers look trendy and wealthy.
With each new model that Apple comes out with, their prices are higher and yet the
customer is not even getting the full product anymore.

Defining the problem:

Apple stopped including chargers and headphones in iPhone 12 boxes without decreasing
the price of the phone. They claim that it was for environmental purposes although some
experts say that the impact would be minimal. Now, if the customer doesn’t already have a
USB-C plug, they would have to buy one for $19 (or 99zł in Poland). What they didn’t
directly announce was that they would also stop including chargers and headphones in their
older models as well. They have done similar things in the past e.g., removing the mini jack
input from iPhone 7 which made users unable to use off brand headphones thus
encouraging customers to use their wireless Air Pods. The Brazilian customer protection
agency fined Apple $2 million for failing to include chargers within iPhone 12 boxes.

Determining the objective:

Keeping new and old customers satisfied with what they get for the price they pay buying an
iPhone.

Exploring the alternatives:

a) Reducing the price of the iPhone by the price of the adapter thus justifying not
including it.
b) Including the power adapter in an iPhone box.
c) Selling the iPhone in a bundle with the power adapter, allowing the customer to buy
the phone only for a lower price.

Predicting the consequences:

Ad a) Even though the customer is paying less, the difference isn’t that significant, and they
still have to go out of their way to additionally buy a product that would enable them to
continuously use the iPhone they bought.
Ad b) If Apple goes back to including the power adapter in the iPhone box, they admit that it
was unfair not to do so and at the same time spoil the environmental concern argument
they gave.
Ad c) Apple can maintain their environmental concern by giving the customer the
alternative to buy the eco-friendlier option if they already have the USB-C power adapter
and save some money.
Making a choice:
Procon-SP (the Brazilian customer protection agency that has fined the company) asked
Apple if they are going to lower the prices of the iPhone 12 since they do not include
chargers and they have not received a response. They have however lowered the prices of
the previous models which would from then on be sold without chargers.
Selling the iPhone in a bundle with the charger would make the customer feel like they are
getting a bargain which is what customers want and love the most. If they feel like the
company is giving them a good deal by allowing them to pay less – they won’t feel like their
order is missing something that should be included. The company could maintain their old
costumers who might otherwise possibly stop supporting Apple for taking advantage of
their trust in the company.

Sensitivity analysis:
By not including the chargers in boxes, the company is obviously saving money by giving the
customer less for what they are paying for. They are also making more money by making the
client have to pay for the charger they would previously get by default when purchasing an
iPhone. If Apple hides the price of the additional charger in the bundle (iPhone + charger)
and then allows the customer to choose to buy solely the iPhone for e.g., $19 less, that
might attract more potential sells. Not putting a charger in the box means they can
significantly reduce the amount of packaging and they reckon to get 70% more on a
transport pallet which means fewer shipments for them.

Sources:
Indiatimes.com
Appleinsider.com
Theverge.com
Apple.com
Zixtel.com