Through the years I’ve been a preacher of differentiation. Products that are well differentiated against competing products do better. Apple is a perfect example. Not only are Mac, iPhone, and iPad designed differently than most competitors (and they set the design trends), but with macOS and iOS, the company maintains differentiation from Google, Microsoft, Samsung, Amazon, and every other competitor that wants a slice of Apple.
Apple just doubled down on differentiation with the iPad. A few weeks ago it was an iPad for $329. Price can be a big differentiator, but Apple’s new iPad Pro line further separates Apple from everyone else. While PC makers and Microsoft carry the banner of Windows 10 and touchscreen to nearly ever PC notebook and many desktops, Apple improved on the iPad Pro experience and dropped the price.
Gone is the 9.7-inch iPad Pro, now relegated to a $329 entry-level model, replaced by a 10.5-inch professional device that looks the same, weighs the same, but sports with improved hardware at every level. It’s still a pound but now has a full onscreen keyboard, still does Apple Pencil, but now has an improved Smart Keyboard, and coupled with iOS 11 later this year could– arguably– move the iPad Pro into a position where it can replace a PC. Or, a Mac.
iPad Pro will look much the same as previous models but hardware is improved with True Tone display, ProMotion technology (helps to conserve power but give plenty of high resolution motion), and more. There’s an A10X Fusion CPU, a better camera with 4k video recording capability, slo-mo and time lapse, and all the goodies that iPad Pro users already love.
The price tag starts at $649 for the 10.5-inch model and 64GB of storage but can hit $1,229 with the 12.9-inch iPad Pro with 512GB storage and Wi-Fi + Cellular. The Smart Keyboard adds another $169 so the larger iPad Pro with 256GB of storage and Wi-Fi only weighs in at $1,068, still more than an entry-level MacBook Air that features lesser storage, but a full $200 less than the entry-level MacBook with comparable hardware.
Do the math.
Browse through Apple’s iPad Pro and MacBook line to see how cleverly the company segregates various models via hardware specifications and price.
The MacBook Air exists because the seven-year-old design still sells well. The MacBook starts at $1,299 but that’s with an Intel Core m3 CPU. The latest model features options to upgrade the CPUs to Intel Core i5 and i7. $100 more for the former, $250 more for the latter.
That means a Core i7 MacBook fully tricked out with 16GB RAM and 256GB SSD storage becomes $1,749, just $200 less than the same hardware on a MacBook Pro, which, in turn, can skyrocket to $2,899 for a faster Core i7 with 16GB RAM and 1TB SSD storage.
Every new iteration of each product, iPad Pro or MacBook or MacBook Pro is a couple of hundred dollars higher for more power and more capacity.
The difference with the new iPad Pro models will show up in iOS 11 later this year when an improved file management system and multi-tasking options will make the tablet more competitive with mid-range Windows 10 PC notebooks thanks to the new Files app. It’ll do multiple apps on the same screen with built-in drag and drop of files between apps.
That makes the iPad Pro line work more like a Mac, therefore, more like traditional Windows 10 notebooks and the touchscreen notebook and tablet hybrid models which are gaining in usage (not necessarily in popularity, because those devices are seldom used as actual tablets in the iPad sense).
Simple put, Apple differentiates better, another reason it commands higher revenue and gross margins per product, and, therefore, owns the profitshare of each industry segment where the company plays and competes.