Analyst Calls Apple a Luxury Brand, Not a Tech Company
With Apple selling a $999-priced iPhone X and that too just for the base storage model, the company has often come under fire for the pricing of its goods. Though Tim Cook has reiterated that the company’s products are not for the rich, one analyst was eager to state that the company is indeed a luxury brand, suggesting that consumers who purchase an iPhone do it because they want to feel more accepted in society.
Analyst States That Apple Is a Luxury Brand That Is Competing With the Likes of Louis Vuitton
According to HSBC analyst Erwan Rambourg, he wrote in a note his clients received that stated the following:
“Recently, with an offensive retail strategy and in some cases comparable price points, Apple has competed with the likes of Louis Vuitton, Cartier or Prada which made us raise the question: is Apple actually a luxury stock? Yes.”
Well, looking at the company’s long history, we have never known Apple to sell luxury handbags and since its products are categorized under the tech segment, it is indeed a technology company.
“Apple competes well across all of these different sectors because of its versatility in its functionality, but like luxury brands, it's also competing as a way to express status and to fit in. Consumers are buying the spirit of the brand and the way it makes them feel about themselves and in society.”
We will argue that the iPhone X is a step too far as regarding the pricing, but it is expected that the iPhone lineup incoming in 2018 is going to be geared towards a cheaper price. One of the reasons why the smartphone features a $999 price tag is because the tech giant pays Samsung an exorbitant sum of money for each OLED screen sold and it looks like the Korean firm is going to remain its supplier for the time being.
Do you think Apple is a luxury brand or a tech company? Tell us your thoughts down in the comments.