Apple's New Strategy: Sell Pricier iPhones First (wsj.com)

The staggered release gives the company a month to sell higher-end models without cheaper competition from itself. WSJ: This year, according to people familiar with Apple's production plans, the company prioritized production of its two pricier OLED models, the iPhone XS and XS Max, whose prices start at about $1,000. Both will hit stores Friday, followed five weeks later by the least expensive new model, the XR, which has an LCD screen and a starting price of $749. The staggered release gives Apple a month to sell the higher-end models without cheaper competition from itself. It also simplifies logistics and retail demands and could strengthen Apple's ability to forecast sales and production of all three models through the Christmas holidays, analysts and supply chain experts said. "It's sort of a Dutch auction," said Josh Lowitz, co-founder of research firm Consumer Intelligence Research Partners, referring to the practice of starting with a high asking price, then lowering it until a buyer accepts. "The people who are most committed will pay to get early access. Then you get to the people who are making a choice and may settle for the $750 phone. This could become the new normal."

Comments

It's more about skimming the cream

[JoeyRox]

This is a standard marketing strategy and not unique to Apple. You charge more for people who are willing to pay more (early adopters), then phase in a lower ASP as the demand curve shifts toward more typical mid and late stream adopters.