Why iPhones Don’t Get Discounts in the US Unlike Other Countries
Unlike Android companies that offer discounts every so often, Apple rarely discounts the iPhone (or any Apple product, for that matter). But this no-discount pricing policy is largely prevalent in North America, specifically the US and Canada.
Other parts of the world do indeed get discounts on the iPhone. But why does Apple avoid discounts in one region but not in others? Let’s discuss some theories about Apple’s pricing strategy.
Why Apple Avoids Discounts Unlike Android Companies
First, let’s understand why Apple avoids discounts, but Android companies rely on them as a pricing strategy. We know that when the price falls, the quantity demanded of that product usually goes up, and vice versa. And the stronger this effect, the more “elastic” the demand is—as you might’ve learned in your high school economics class.
But if the demand is more “inelastic,” it means that a change in price doesn’t affect the quantity demanded that much. In Apple’s case, the company has an incredibly loyal fan base, and people are more willing to buy an iPhone despite a price increase—pertaining to inelastic demand.
By avoiding discounts, Apple maintains its brand image and the perceived value of iPhones in buyers' minds and retains the resale value of older iPhones for much longer. In the case of Android companies, it’s the exact opposite: Android users are more open to switching to a different brand.
Because of this, Android makers have no choice but to offer discounts to capture more of the market. But sadly, this also hurts their brand image and the resale value of their products. After all, why would you pay full price for a product if you know you can probably get it for cheaper by just waiting a few months or until the next holiday sale?
The more discounts a company offers for its phones, the less a second-hand buyer will be willing to offer you when you latersell your phone onlinebecause they don’t perceive it as valuable as an older iPhone. This is why Samsung phones, for example, lose value so quickly and why the company has been limiting its discounts lately.
Why iPhones Get Discounts Outside North America
In North America, Apple’s strategy is tokeep iPhone prices steadyto make Android users switch. But this strategy doesn’t work in developing countries where people are more price sensitive (and hence have a more elastic demand) due to lower household incomes. So, if Apple reduces iPhone prices, it can expect to gain a lot of new users.
Don’t forget that iPhones cost a lot more outside the US due to import duties, customs, and shipping charges. For example, the iPhone 14 Pro starts at $999 in the US, but in India, it costs INR 129,900, which at the time of writing is roughly $1,569. That means a buyer in India would pay almost 57% more for the same device!
If you take this into account, Apple reducing the price of the iPhone technically isn’t a discount but more of an attempt to deliver a US-equivalent fair price to other countries. But to a buyer, this technicality doesn’t really matter because they are still getting an iPhone for cheaper in their country. Something is better than nothing, after all.
Different Regions Require Different Strategies
Apple knows that it has already saturated the North American smartphone market. And so, the next target should be emerging markets like Southeast Asia, the Middle East, and Africa, which can prove to be a lot more lucrative in the long term.
The reason Apple waited until now to capture these markets is likely that people in these regions simply didn’t earn enough at the time and couldn’t have afforded an iPhone despite a discount. But now, as incomes are rising across the globe, people naturally want to spend more—and the iPhone is the perfect place to start.
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