Apple and Product Obsolescence Descriptive Term Paper

In other words, the greater the dangers of comparative substitutes of lower price competing with the current product, the more incentive textbook authors have to change the model, to make using the older editions more difficult or impossible, underlining the value of obsolescence. Additionally, with new technology, the current version may not be useable or as functional when used in conjunction with the older versions, which makes getting the latest model even more critical. However, unlike textbook publishers, who have a virtually captive audience, because students are required to buy the latest edition of their books, Apple's customers have more options to opt out of the new purchases.

Apple's frequent innovations give it first mover advantage. However, it is also argued that while "first-mover advantage was initially touted as crucial in the Internet economy....there is a growing backlash...First-mover advantage can be instrumental in building market share, but this may or may not translate into business success" ("First mover advantage," 2008, Marketing Terms). Being first is seen as a crucial competitive and comparative edge that Apple has possessed against the relatively slower pace of change at Microsoft, but if this continual innovation is now becoming an annoyance, even a late night television joke, Apple may need to rethink its approach, and focus on different aspects of its marketing mix and allocation of resources, perhaps shifting from a focus on minor changes in products to increasing value and services for consumers.

Management Application

Allocating resources to R&D and establishing a first mover advantage over competitors, however small, is something managers frequently face in their day-to-day decision-making. Is the revenue generated by consumers shifting to the upgrade enough to stifle the ire and buyers remorse of current purchasers? When reducing the price of a relatively a new item like the iPhone, producers must remember how Apple had to apologize to consumers who bought the first, identical iPhone at inflated prices, only to see its price rapidly decline within a few months. Although artificially generated scarcity and excitement over novelty may be selling points, Apple's example serves as a potent warning as well as to the limits of relying upon these techniques.

Works Cited

First mover advantage." (2008). Marketing Terms. Retrieved 13 Jan 2008 at http://www.marketingterms.com/dictionary/first_mover_advantage/

Iizuka, Toshiaki. (Jun 2004). "An Empirical Analysis of Planned Obsolescence." Retrieved 13 Jan 2008 at http://www.aeaweb.org/annual_mtg_papers/2005/0107_1015_0616.pdf

Wingfield, Nick. (12 Jan 2008). "The downside to Apple's frequent product updates."

The Wall Street Journal. A2. Retrieved 13 Jan 2008 at http://online.wsj.com/article/SB120008119783584359.html?mod=mm_hs_marketing_strategy