Apple to offer early iPhone adopters $100 credit - Jobs

[AppleInsider]

After personally reading hundreds of emails from disgruntled iPhone customers, Apple chief executive Steve Jobs appears to have had a change of heart and now plans to offer early iPhone adopters a $100 credit towards future Apple purchases.

In an open letter to customers published on Apple's website, Jobs conceded that while the technology road is a bumpy one, Apple should have done a better job of taking care of early iPhone customers, many of which make up the company's most faithful.

"Our early customers trusted us, and we must live up to that trust with our actions in moments like these," he wrote, referring Wednesday's unprecedented 33 percent price drop on the iPhone just 9 weeks after release. "Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store."

Details on the $100 store credit are still being worked out, according to Jobs, but will be posted on Apple's website sometime next week.

"We want to do the right thing for our valued iPhone customers," Jobs added. "We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple."

[ View this article at AppleInsider.com ]

[Bacillus]

We won...Thanks Screw Jobs...uhh... Steve Jobs

[dreamraj]

woohooo

[ryukyu]

I can definitely live with this.
Way to step up Steve!

[trragan]

Originally Posted by ryukyu

I can definitely live with this.
Way to step up Steve!

Nice work guys.

[TBaggins]

VERY smart move by Steve. A little late in coming, but it should generate considerable goodwill... or at least lessen the badwill significantly.

You just don't screw over your most ardent fans... always a bad plan. You may not pay for it intitially, but you will long-term.

It's nice that Steve has an open mind and can change his mind once in a blue moon.

.

[eodchop]

Steve,

I just want to say thank you! I makes me happy to know that you appreciate all of us that makes what you do possible. I will spend my 200 dollars wisely at your store. I just hope we can use it on Itunes also!


Cheers

[onceuponamac]

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

[ebolagp]

Can't wait to hear from Melgross et al about this. I guess Apple didn't see it your way after all and maybe, just maybe all of the 'whiners' were not so far off-base (or as unimportant as you made them all out to be) after all...

[cameronj]

Originally Posted by onceuponamac

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

BS. There is no risk of losing a lawsuit after you lower your prices. Ever. Stop kidding yourself. It was a good move though, not out of the goodness of their heart. I'm amazed how quickly everyone seems to have forgiven - remember Apple is the company that makes 50% margins on everything - that $100 credit just means another sale for them. Duh!

[Saiko]

Hell. Yes.


Wow, heck of a pleasant surprise! Steve, you've got a customer for life! (Though you had one for life anyway even without the surprise. haha)

[cameronj]

Originally Posted by ebolagp

Can't wait to hear from Melgross et al about this. I guess Apple didn't see it your way after all and maybe, just maybe all of the 'whiners' were not so far off-base (or as unimportant as you made them all out to be) after all...

I was one of those calling people whiners, and I don't see how this changes anything. First they did not give a refund, they gave you a credit for a future sale. A future sale on which they will still make several hundred dollars from you.

Secondly, Apple's response to the overwhelming whine-fest that was on these boards yesterday does not change the fact that it was a whine-athon.

[CosmoNut]

Originally Posted by onceuponamac

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

Not necessarily. Steve Jobs is smart enough to know that the Apple fan base doesn't forget...anything. There are STILL people pissed that the Cube and Newton were discontinued. I think he understands that businesses aren't businesses without customers. They might take a hit on this now, but in the long run it will bode FAR better for them.

I personally am okay with buying a good or service for a higher price if I know the company is going to take really good care of me. That's why I use a Mac in the first place.

[BRussell]

Originally Posted by onceuponamac

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

There's no possible way you can sue a company for lowering their prices. This wasn't about legal counsel, it was about making customers happy so they'd continue to lub Apple.

[audiopollution]

Originally Posted by onceuponamac

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

Could you please explain how dropping the price on a consumer electronics item opens Apple up to a lawsuit?

Ridiculous.

This is a gesture to stop erosion of goodwill. Nothing more.

[onceuponamac]

Originally Posted by cameronj

BS. There is no risk of losing a lawsuit after you lower your prices. Ever. Stop kidding yourself. It was a good move though, not out of the goodness of their heart. I'm amazed how quickly everyone seems to have forgiven - remember Apple is the company that makes 50% margins on everything - that $100 credit just means another sale for them. Duh!

I think you're wrong - for reasons I've posted in other threads - i think the likihood of valid claims was high - i'm sure the class action attorneys are disappointed because at a minimum a likely settlment was just cut in half...

[TBaggins]

Originally Posted by cameronj

I was one of those calling people whiners, and I don't see how this changes anything. First they did not give a refund, they gave you a credit for a future sale. A future sale on which they will still make several hundred dollars from you.

Secondly, Apple's response to the overwhelming whine-fest that was on these boards yesterday does not change the fact that it was a whine-athon.

Call it whatever you like, but Apple ended up seeing it their way, not yours, apparently.

Oh, and... w00t! 1,000th post!

.

[k2director]

Way to go, Apple. It's a smart business decision, and the right thing to do.

Now let's get back to making this phone the monster success that it can be. You guys keep improving the feature-set (hint: a To Do function would really be nice start!), and I'll keep proselytizing to my friends, family, co-workers, etc.

[onceuponamac]

Originally Posted by audiopollution

Could you please explain how dropping the price on a consumer electronics item opens Apple up to a lawsuit?

Ridiculous.

This is a gesture to stop erosion of goodwill. Nothing more.

claims can be the basis for lawsuits - but are often resolved prior to litigation. I posted the basis for my view in other threads...

[audiopollution]

Originally Posted by onceuponamac

I think you're wrong - for reasons I've posted in other threads - i think the likihood of valid claims was high - i'm sure the class action attorneys are disappointed because at a minimum a likely settlment was just cut in half...

A company is under no obligation to sell the same product, at the same price, for any given period of time.

[jwyatt]

I've been biting my lip since yesterday weighing Apple's justification for lowering the price (which I agree with) and that of iday buyers like myself who feel a bit cheated. I have been a complete Apple fanatic (to the extreme - consider this site) for a long time. Yesterday almost had me thinking that Steve /Apple was no different than the rest of Corporate America but today (under some pressure) He listened and responded in a very appropriate way. In the end I would have gotten over the measly 200.00 buck's (it's actually been worth it to have the phone) But I think Apples response solidifies the reason why so many enthusiast are so loyal. Today, I'm proud to be such an Apple nut and the 100.00 dollars has nothing to do with it.

[Felix E. Martinez]

Good for him. That's the way to do it!

[zanshin]

Apple comes off as "listening to the whiners, I mean, spoiled customers." Good PR move. Defuses the rhetoric.

And they give those folks $100 credit for use at the store. Which means you get about $50 worth of stuff they bought for $10. Good financial move.

Then they hit you up with the shipping and handling charges on your $100 purchase you didn't buy at Target or BestBuy. Even better financial move. Pure profit.

And now you'll all go buy a SECOND iPhone for $400, because that lowers your overall price for two phones even more. You give the "older" one to your old lady, who has never forgiven you for quitting your job to go stand in line for 3 days to pay $600 for a stupid cell phone in the first place. (After all, she has a $29 one that she uses 24/7 to call and tell all her friends what a loser you are.) She loads up her "new" iPhone with pictures and video of you passed out drunk on the apartment floor with fake eyebrows drawn on your face in permanent marker by your loser friends.

Everybody wins.

[icibaqu]

wow...BOOM!

and for many iPhone buyers, hello $49 iPod nano.

[rrightm]

Originally Posted by cameronj

BS. There is no risk of losing a lawsuit after you lower your prices. Ever. Stop kidding yourself. It was a good move though, not out of the goodness of their heart. I'm amazed how quickly everyone seems to have forgiven - remember Apple is the company that makes 50% margins on everything - that $100 credit just means another sale for them. Duh!

Agreed. In fact, this may be the case where Steve Jobs has actually made chicken salad out of chicken shit. Indeed, he probably had this planned out. Needed to cut the price to drive sales to meet expectations. He knew it would seriously piss of his "loyal" customers. Let the press eat up the screaming of these customers for a day. Then, comes out with his "open letter" offering an olive branch which apparently is enough to placate most. All the while, this olive branch will, as you point out, actually end up making Apple MORE money from these people, or at least not losing any.

I was one of the early adopters who bought on June 29th. I don't care if I get the credit or whatever. I just became more impressed with Jobs, not because of the goodness of his heart, but rather because of what appears to be shear cunning and marketing savvy. Interesting.

[mrjoec123]

Originally Posted by cameronj

BS. There is no risk of losing a lawsuit after you lower your prices. Ever. Stop kidding yourself. It was a good move though, not out of the goodness of their heart. I'm amazed how quickly everyone seems to have forgiven - remember Apple is the company that makes 50% margins on everything - that $100 credit just means another sale for them. Duh!

True. Store credit is never as expensive to give away as it appears. It's like a casino comping you with a free hotel room.

I'm sure I'll be happy to spend that $100 credit, but I do think it's a mistake to capitulate to crybabies. It only encourages them to do it again and again. And it also makes them all gloat about how "effective" all their whining was.

This kind of thing is exactly what makes our legal system so screwed up in this country. I think Apple would have been better off taking the bad press for a week or two, and then laughing all the way to the bank this holiday season as they outsell every previous iPod holiday season by a wide margin. It wasn't going to hurt iPhone sales in the long run.

But they obviously know something I don't, so I'll take my $100 and move on.

[Bacillus]

Originally Posted by audiopollution

Could you please explain how dropping the price on a consumer electronics item opens Apple up to a lawsuit?

Ridiculous.

This is a gesture to stop erosion of goodwill. Nothing more.

...and to keep the credit card companies that offer price protection happy. AE, and others sure did not like eating a 200/phone cost that customers were rightfully requesting.

[k2director]

Originally Posted by onceuponamac

this isn't from the goodness of apple's heart - they obviously got advice from their counsel that they were at risk for a claim - - -

Dude, it must suck to go through life being such a cynic.

[onceuponamac]

Originally Posted by audiopollution

A company is under no obligation to sell the same product, at the same price, for any given period of time.

Actually, consumer protection laws do have provisions regarding what companies can charge for similar products. Regardless, i'm not talking about a product - i'm talking about breaching contractual commitments (written and otherwise) and the remedies the breached party can seek upon breach....

[tomkarl]

I'm loving this. Way to step up to the plate Apple!

I was fine that I paid $200 more than the current price. I chose to buy it and a future lower price wouldn't have stopped me from buying it at launch time.

It's a smart way to do it because it drives more sales. Also, given the margin on products, $100 in retail credit doesn't actually cost Apple $100. A win/win.

Since I can't justify buying a new iMac (the G5 iMac is plugging along fine), maybe I'll try out one of the new keyboards.

[pt123]

Whining has it's rewards.

[mrjoec123]

Originally Posted by icibaqu

wow...BOOM!

and for many iPhone buyers, hello $49 iPod nano.

I can't see the need for a nano once you have an iPhone, unless you need it for jogging, or something. That little screen is so disappointing after seeing the iPhone's screen. And there's no capacity advantage.

Now a $250 classic 160 GB is more like it. Keep all my music on one iPod, and have the iPhone for the occasional mobile video.

[zanshin]

I don't care if you flame me or not. Just thought I'd fully explain that I was joking above, so I could save you some time.

[cnocbui]

Steve has class!

[onceuponamac]

Originally Posted by rrightm

Agreed. In fact, this may be the case where Steve Jobs has actually made chicken salad out of chicken shit. Indeed, he probably had this planned out. Needed to cut the price to drive sales to meet expectations. He knew it would seriously piss of his "loyal" customers. Let the press eat up the screaming of these customers for a day. Then, comes out with his "open letter" offering an olive branch which apparently is enough to placate most. All the while, this olive branch will, as you point out, actually end up making Apple MORE money from these people, or at least not losing any.

I was one of the early adopters who bought on June 29th. I don't care if I get the credit or whatever. I just became more impressed with Jobs, not because of the goodness of his heart, but rather because of what appears to be shear cunning and marketing savvy. Interesting.

i agree with you - i think this was likely planned out - apple's success isn't only about serendipity - it's about Jobs' vision of the future of technology and media being right..

[sandau]

BRILLIANT MARKETING MOVE


what if....this was planned out from day one of the release? Can Apple be that smart?


How many people on the planet now know the iPhone is $399 ?

no such thing as bad press.


makes you go hmmmm.

[GQB]

Originally Posted by ebolagp

... just maybe all of the 'whiners' were not so far off-base (or as unimportant as you made them all out to be) after all...

Oh for christ's sake... now we have to listen to the whiners gloat as well.

[audiopollution]

Originally Posted by Bacillus

...and to keep the credit card companies that offer price protection happy. AE, and others sure did not like eating a 200/phone cost that customers were rightfully requesting.

Aaargh.

Apple have no obligation to the credit card companies to keep the price the same. Apple have no control over the 'price protection' policies that the credit card companies offer.

Of course, it's easy to offer price protection when you charge a decent interest rate and also take 1 to 2.5% of the purchase price from the merchant as the 'service charge' on every purchase made on the card.

[rrightm]

Originally Posted by onceuponamac

i agree with you - i think this was likely planned out - apple's success isn't only about serendipity - it's about Jobs' vision of the future of technology and media being right..

But, I'm not saying he was wrong in doing so, if he did plan it out. I think he was bloody brilliant, is all I'm saying. From our past discussions with one another in another related thread, I'm sure you will disagree with me.

[onceuponamac]

Originally Posted by rrightm

But, I'm not saying he was wrong in doing so, if he did plan it out. I think he was bloody brilliant, is all I'm saying. From our past discussions with one another in another related thread, I'm sure you will disagree with me.

I don't think he was wrong - I think he is smart and was well advised. So, I don't disagree except to the extent that you believe I will disagree with you (on the point about whether Jobs is right).