What $500 Buys a Mac Customer: Leverage

| Editorial

The technical and business community is replete with stories about how just a little bit more skill generates an enormous amount of leverage. Here are some examples that explain why Mac customers are all too happy to pay a little more for their computers.

I took some golf lessons last fall. I was told by my instructor, a golf pro, that the average difference in handicap between the top 10 money making pros and the 2nd tier guys who struggle to make a living is about 1 or 2 strokes.

That is, as a very good pro, if you can improve your game by two strokes, you'll go from $100,000 a year to $1M+ a year. A very fine difference in skill generates enormous financial leverage.

Recently, my wife ran across a story about the differences between an average programmer and the very best. The span, in the number of lines of code generated each day is a factor of 10. A little more skill generates a lot more code. Yet, managers are generally unable to distinguish between these levels because they don't have the programming expertise to evaluate their people.

Finally, we know in business that executives who are just a cut above the rest can make a whole lot more money. CEO's are, after all, human beings, and it's unlikely that there is more than 20 I.Q. points difference between them. But add that special, undefinable knack, perhaps through experience, training and temperament, and a CEO can raise his (her) income from $500,000 a year to $50M.

That's the Mac.  You increase your efficiency just a little and pay a little more, but the gain ends up being huge. You don't trifle away your life messing around. Things just work. Software works with other software and is well integrated into the hardware. We all know this, but the recent Microsoft ad campaign, seeking to take advantage of tough economic times, would have us believe that we should buy cheap crap and fall down a rabbit hole of frustration and lost time.

What's fundamental here is that hardware is cheap, but software is hard.

That principle of personal leverage and productivity via skills is found in hundreds of books in the business section of the library or book stores. As my friend David Sobatta said in his blog this week, "...but for some of us 'good enough' is just not enough."

Which personality are you? For Lauren, good enough was good enough. Microsoft thinks that's cool.

I can just see the "Get A Mac" ad team at TBWA\Chiat\Day brainstorming now.

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7 Comments Leave Your Own

Daniel Boulet

The bad taste of poor quality remains long after the thrill of low price has faded.

breeze

The low price has a lot of hidden extra after purchase support and basic productivity necessary costs which in effect makes PCs - MUCH more expensive, frustrating and painfully unproductive, oh and lets not forget the extra protection and virus related protection and remedy…

WetcoastBob

Let Microsoft wallow in their own mediocrity. 

Too many customers are fixated by low acquisition price and fail to look long term.

The sad thing is that while most Mac users have PC experience and know the difference PC users literally do not know what they are missing.

Mom

Have you lost your mind?

$2,500 for a computer? Add on those extras, then the tax.

$3,000 ? FOR A COMPUTER?

I don?t care if it lasts four years. I don?t care if it ?gives you a good experience? as filthy as that sounds.

For people who don?t need a computer to do work they get paid for, anything above 400 or 500 dollars is an idiotically high price.

But I suppose that?s what Apple marketing is all about, and why they have all these Mac idiots brainwashed. I?ve never seen such a bunch of whiny crybabies.

Waaaah. Clicking on applications is sooooo haaarrrddd. The computer almost locked up on meeeee when I was transferring a fiiiile. The experience isnt the saaaaaame. I have to have things a CERTTTAIN WAAAAaaaaYyyyyyy.

The $300 netbook of today is the $3000 Mac of 5 years ago and more so.

Don?t you think Apple execs realize that so called ?el cheapo? computers available now actually do a ton of stuff that ?cheap? computers had no way of doing just five years ago?

If people realize that, and free their minds of this brainwashing, then there is no more need to spend a ton of cash.

Don?t you think Apple publicists skulk through these pages all the time and drop BS about the ?Mac Experience? justifying the ridiculously high cost? If they didn?t have these Mac idiots lulled into a state of unconsciousness about how much money they?re being ripping off of, Apple would lose their profit margin business strategy and dehydrate.

People don?t like it when they get called up on the fact that they?ve been fooled and cheated out of their own money. Build quality, my ass.

GlennG

Are Macs too expensive?         
By Wolfgang Gruener    

Opinion ? I am sure you have seen one of those omnipresent new Microsoft commercials that aim to portray Mac products, in this specific case notebooks, as too expensive (if you haven?t seen the ad, you can watch it here.) There?s quite some buzz over the question whether Macs are really too expensive. At least for some, Microsoft?s new campaign might be a bit shallow, let alone leave the impression that Windows PCs are simply ?cheap?. And even if we live in a recession, the description of being ?cheap? might not work.

Before I lay out my opinion on this new commercial and before you add your comment below, let me first mention that I am actually a convinced PC user, always have been, for various reasons I don?t want to go into here, and I always felt that Apple computers were, at least for my purposes, way too expensive. And if you try hard enough, it isn?t particularly difficult to make the case why Apple products are expensive (notice: I am not saying ?overpriced?). But Microsoft?s attempt to convey this message is flawed and, sorry, a bit silly. Is there anybody in Redmond who is actually reviewing those commercials before they are approved and aired?

So, what do we have here? A woman who tries to buy a 17? notebook for less than $1000 and leaves an Apple store, because they only have one system for less than $1000 and it has just a 13? screen. She concludes that she is ?not cool enough? to be a Mac person and she would have to spend $2000 for what she would want. So she ends up with an HP notebook that has all she wants for $699.99. The commercial ends at the cash register ? and exactly the point where the commercial?s protagonist, Lauren, would begin a rather painful adventure with her new notebook - setting it up her - and would learn where the real value of the Mac really is (simplicity that already begins when you set it up.) So, at least this strategy makes sense from Microsoft?s point of view, even if anyone who has ever bought a Mac would respond with ?Yeah, right.?

Let?s be serious. Are Macs as overpriced as Microsoft makes them look like?

I guess we can agree on the claim that Macs are more expensive than PCs with the same hardware. So, there is a premium involved and it is a question what you get for that premium. And if that what you get has real value.

I?ll take a shortcut here and invite you to discuss that below in our comments section. Yes, I am a PC buyer, never bought a Mac in my life, but I know that a Mac is not just hardware. It is a coherent package of nicely designed hardware, innovative touches and software that just fits. Besides the clean design of Mac computers, you get features such as the magnetic power plug and a shell that does not show fingerprints. The only Mac system I ever reviewed was up and running within 10 minutes out of the box. Is that value? Absolutely. In the end, a Mac is not just a piece of hardware that you can define by the size of the screen. It is the experience you buy. And, of course, the brand ? just like you would pay extra for the experience to drive a BMW.

When I buy a new PC, I routinely plan a few hours to set this thing up, remove the boatload of crapware that subsidizes the price of a PC and I usually don?t care how the system looks like. Hey, it is a computer! It is supposed to run Word, Firefox and Photoshop. Do I care what it looks like? No. And if we look at Lauren, who ended up with an HP Pavilion notebook and I look at my HP notebook that is collecting dust in a corner in my office (a Pavilion tx1000, most likely one of the worst notebook designs to ever have come out of HP), I wonder if Lauren will also soon complain about HP?s inability to come up with surfaces that do not show fingerprints. I?d actually like to fast forward this moment of purchasing the notebook an hour or two into the future of Lauren and find out if she still feels good about her purchase then? Setting up Vista is so much fun.

What Microsoft does not emphasize enough is the fact that there is an obvious gap in Apple?s notebook product line: There is no 15? or 17? Macbook for less than $2000 and $2800, respectively. If you have $2000 or less to spend, you are stuck at 13? with Apple. Lauren claims that she would have to double her budget to get a 17? notebook, which isn?t exactly true ? she would have to almost triple it. To me, it seems that Microsoft is way too careful when trying to make the case for the PC vs. Mac. In this case, we can be certain fact that Apple will respond and it won?t be especially difficult to ridicule the PC as a cheap piece of hardware.

Sorry, this one did not work, Microsoft.

DudeMac

For people who don?t need a computer to do work they get paid for, anything above 400 or 500 dollars is an idiotically high price.

And spending between $200-400 on an operating system is also idiotically high priced.  I can build a more capable Linux PC for the retail price of Windows Ultimate alone, heck I can build a Linux PC in general for the retail price of Windows Basic.

It seems like Microsoft is suffering from the “the pot calling the kettle black” scenario.  Let’s not forget that the retail price of Windows has more than doubled since the early ‘90s whereas the Mac (as well as PCs) have dropped in price in the same timeframe.

Put it this way, if we all only cared about price, then we’d all be using Commodore 64s (or Amigas) because PCs and Macs were WAY more expensive than those of the same era and the C64 had a lot more software available in those days than PCs and Macs!

WetcoastBob

I just read a piece in Popular Photograpy called “Back to Basics: RAW”.  Disappointingly the article only dealt with a PC.  I was appalled to see that the only way to download from card or camera is with purchased software or the clunky stuff that comes with some cameras.

Any new Mac, right out of the box, can download and edit photos with the supplied software.  No need for expensive Photoshop unless you are extremely interested in image manipulation.  A $200 advantage to the Mac.  Mail and iCal take care of the calendar and e-mail, no need for Outlook.

For $79 iWork provides a fabulous word processor,  slide presenter and spread sheet program.  No need for Office. (All applications convert to Word, PDF, Excel or PPT.)

As to the Add regarding the $1000 17” laptop…  the screen resolution is the same as a 15” MacBook Pro so Lauren now has the dubious pleasure of lugging an oversized 15”.

When I bought my MacBook Pro 3yrs ago I spent over $3000 including tax.  I would not go back to a PC even if they were free.

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