If you want to participate in a market where things are priced according to what they cost the vendor, look into gypsum. In tech companies, cost-based pricing is good mostly for getting you fired from your Product Manager role.
Tech products are priced according to the market. For many products, Apple competes aggressively on price. What that means is that within the product line, Apple wants there to be a SKU with the best pricing among its substitutes. It may also mean that every product in the line "wants" a price that is competitive according to its specs. But neither of those pricing goals means Apple will price anything according to the cost of components.
Finally, and perhaps most importantly, in complex markets one of the most important jobs marketing has is to segment the market, which means finding product attributes that command different price points to maximize profit for the company. It may be the case that, regardless of what it costs Apple to add storage to the iPad, the most common kind of customer that wants a large-storage iPad isn't very price sensitive.
This works in both directions. You can play the segmentation game in exactly the opposite direction in enterprise sales: release your product as open source, but sell a supported site-licensed edition. In virtually all Fortune 1000 companies, it is next-to-impossible to embark on any new IT initiative without an accompanying purchase order; the whole of what IT does is structured around selecting, procuring, and maintaining products.
If you want to participate in a market where things are priced according to what they cost the vendor, look into gypsum. In tech companies, cost-based pricing is good mostly for getting you fired from your Product Manager role.
Tech products are priced according to the market. For many products, Apple competes aggressively on price. What that means is that within the product line, Apple wants there to be a SKU with the best pricing among its substitutes. It may also mean that every product in the line "wants" a price that is competitive according to its specs. But neither of those pricing goals means Apple will price anything according to the cost of components.
Finally, and perhaps most importantly, in complex markets one of the most important jobs marketing has is to segment the market, which means finding product attributes that command different price points to maximize profit for the company. It may be the case that, regardless of what it costs Apple to add storage to the iPad, the most common kind of customer that wants a large-storage iPad isn't very price sensitive.
This works in both directions. You can play the segmentation game in exactly the opposite direction in enterprise sales: release your product as open source, but sell a supported site-licensed edition. In virtually all Fortune 1000 companies, it is next-to-impossible to embark on any new IT initiative without an accompanying purchase order; the whole of what IT does is structured around selecting, procuring, and maintaining products.