It costs Apple $501 to make an iPhone 14 Pro Max, and the company sells it at a base price of $1099. This makes Apple’s base markup on the latest iPhone model at 119% Apple is the only tech company able to sell its tech products at such a premium, thanks to a combination of hardware, software, and marketplace.
The economics of Apple’s business model
Apple deploys the opposite strategy.
The iPhone is enhanced by an unlimited number of apps available on the App Store, which are mostly free and make the whole smartphone way more valuable.
Thus, enabling the company to place a premium on its iPhone.
This is the key!
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