Last week Apple rolled out a new line of products including new Macbooks, new iMacs, a new multi-touch mouse, as well as new iPods last month. When new products are introduced, old products drop in price. Is it finally time to buy? Or should I wait until the item goes on sale? Wait… do Apple products ever go on sale?
Let’s investigate using Gazaro’s price trending charts, which are shown when browsing a particular product.
Looking at a few Apple products over different stores (iPod nano x2, iPod touch, Macbook Air), the price trending charts generally show a flat line on the price trending graphs, which means that the price has remained constant over the past month or two. The question is then – how much control do retailers actually have on the price of Apple products?
In fact – retailers must comply with Apple’s Minimum Advertised Price (MAP) policy, which states that the minimum price that a product can be sold is the reseller acquisition cost divided by 0.92 (source). This discourages retailers from placing large discounts on Apple items. The MAP policy is enforced through marketing subsidies, in which the manufacturer would give the retailer money to advertise if the retailer keeps their prices at or above the MAP. However, they can withdraw these subsidies if the retailer sets the price too low.
To avoid this, retailers can offer rebates or a gift with purchase to try to win customers over. Also, since this is the minimum advertised price, some online stores may display “too low to show” or “see price in cart” (image above) in which the actual price will be shown after the item is added into the cart.
Don’t worry, Gazaro will always track the lowest price, even if it’s hidden!
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