Describe the roles of different types of consumer in the demand for the iPhone.
Since the launch of the iPhone in early 2007, the growth of the product has developed year on year, going from simply 270,000 sales in its first launch quarter, to achieving 17,070,000 sales for the most recent quarter ending 2011, demonstrating what a market power Apple’s creation has become in the mobile phone marketplace (Wikipedia, Apple Statistics, 2011). When one attempts to analyse the consumer market, as this essay will do for the iPhone, we cannot simply look at conventional economic theory alone, as ‘the standard neoclassical analysis of demand and consumption is too limited in scope’ (Swann 2009a). Instead, the focus of this examination will centre on four of the most popular consumer theory behaviours that arguably make up the core of the iPhone consumer being that of the, Douglas, Veblen, Marshall, and Galbraith consumer’s. With regards to other theories of behaviour there is simply not the space to truly analyse their contribution fully, and don’t offer as much significance as the others such as that of Routine consumers, who will not be analysed as they simply buy ‘the routine and ordinary’, something which the iPhone cannot be classified as and so is not applicable to the analysis at hand (Warde 2002). One should also note that for the purpose of the essay the deductions are only calculated assessments, as without social context available to us you cannot fully support claims.
Originating from the work of Mary Douglas (1996), whereby she talks of how ‘a strong group regiments the choice of its members’, the Douglas theory on consumption is seen as an ‘inherently social activity... the Douglas consumer has discretion when deciding which tribe to join, but less choice thereafter’ (Swann 2009a). It suggests that we as a community are heavily influenced in the consumer decisions that we make by those around us, and ultimately what is seen as the popular choice at the time. Select features within the phone itself act as platform for encouraging this type of consumer to buy the iPhone with the Facetime app allowing you ‘to make a video call to someone else’s iPhone, iPad 2, iPod touch or Mac over Wi-Fi’ in addition to iMessage allowing free messaging ‘between you and anyone on an iPhone, iPad or iPod touch running iOS 5’ (Built in Applications, 2011). The exclusivity of the communication methods would mean that if the majority of a peer group possessed this phone for instance, the Douglas consumer would have to affirm membership to the social group by following suit and therefore creates demand.
This pattern of consumer behaviour can then be demonstrated when analysing sales statistics between the iPhone and its nearest competitor in the market for smart phones, Blackberry. Using graphical data compiled by Business Insider (2011), it shows how the iPhone’s popularity grew from approximately 14 million in September 2010 to just over 20 million at the same point in 2011. Meanwhile Blackberry’s figures went stagnated and even dropped from 12 million in August 2010 to around 11 million come August 2011. The sharp rise in sales for iPhone in combination with the decline in both Blackberry gives reason to believe people are converting over. This gives substance to the belief that social interaction plays heavily on selection due to Blackberry’s fortunes going in reverse direction to that of the iPhone, namely that people are moving to iPhone as it’s the most dominant smartphone in terms of numbers.
Supporting theoretical evidence to the Douglas consumer theory can also be found when looking into diffusion of innovation. When one examines the epidemic model, it assumes that ‘the rate of adoption is proportional to the product of the number who use the technology and the potential future adapters, mathematically this is demonstrated as: New Consumers = Infected* Uninfected’ (Swann 1b). This can be used in combination with the...
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