Supply and demand often dictate prices. If demand is high, retail prices will remain steady. If demand is low, a manufacturer usually reduces prices to spur demand. Why is that important? Supply is indicative of how many products a manufacturer has in stock or in the pipeline and on the way to retailers or stores.
As with any company that makes or sells products, Apple has a supply and demand issue from time to time. Too many products piling up in a warehouse means prices need to be dropped. Not enough products to meet customer demand means prices will stay the same or perhaps increase.
How does this affect Apple?
From what I can about watching Apple and the company’s many retail sales outlets, Apple has two basic reasons to drop prices and both are rather visible to most of us.
First, when demand is less than supply.
For the most part, Apple does not discount products so you’re not likely to see a big sale at the Apple Store in the mall. Yet, Apple will bundle products which raises the total amount of the transaction but provides something of a discount off the main product.
You’ll also see discounts from Apple’s many retailers, either online or among the big box stores. One I saw recently was a $400 discount on the new 2018 MacBook Pro models. Since the MacBook Pro line is new, such discounts tell me Apple has more inventory than buyers. Discounted prices often spur demand.
Second, when new products are on the way.
Discounts on older products usually occurs– but not always– when new products are in the pipeline and ready to be launched. Again, we see this often with Mac and iPad, but less with iPhone because Apple usually moves older iPhones down the product line with a lower retail price tag.
Again, a recent MacBook Pro sale at Best Buy is more indicative of too much supply and not enough demand. Discounted prices often stimulate demand.
So, what about all those discounts on 2018 iPads; specifically the $329 model and variants? And, what about discounts on the current line of iPad Pro models?
First, we know new iPad Pro models are on the way, so it seems plausible that Apple will allow discounts on the current line to move inventory. Discounts on the entry-level $329 iPad may be a sign that, 1) Apple needs to move inventory, or, 2) new entry-level iPads are on the way, too.
Likewise, there have been discounts on AirPods recently and with the upcoming holiday shopping season on the horizon, it makes sense that Apple wants to move inventory, too.
Just don’t go to the Apple Store and expect a big discount. About the best you can get from Apple directly will be the refurbished models.