Global products, local pricing
Filed under: business, community, gadgets and gizmos, news
Something that has been annoying me for some time is the price differential of identical products between Australia and the United States.
A few months ago I purchased a new Apple MacBook Pro and looked into the cost of their extended warranty product AppleCare. The price in Australia is $419.00. I purchased the same product at the Apple Store, Las Vegas, for $US249 before tax (equal to $A275.85 plus taxes). Of course, before purchasing this extended warranty, I did check it was valid world-wide – which was confirmed in store.
Next I purchased the new Apple Magic Mouse at the Apple Store 5th Avenue, New York. This cost $US69 before tax (equal to $A76.44 plus taxes). The Magic Mouse is $A99 here.
What I want to know is why are we paying more to purchase Apple products in Australia, from Apple (not a dealer), than from Apple in the US? If the products were priced 12 months ago when the Australian dollar was hovering around 64 cents (I still have nightmares thinking what I paid for things January 2009 in New York…), then there may be a justification for the price differences.
We live in a world where the global market is open to anyone with an internet connection. We should not have to put up with this type of pricing inconsistency.
I love to purchase in Australia wherever possible, but why should I pay more for that honour?
I’d be interested in your feedback where you have found an identical product priced in a manner that caused you to purchase it overseas rather than locally. Maybe we can get through to the local representatives and bring about pricing parity.
Same story for the hobby rc plane industry.
Buying overseas is generally 1/3 to 1/2 the price for identical components purchased here. Delivery can be as fast as 3 days from Asia and is often faster than ordering online from a local store.
Pretty sure it’s the distributors in Australia that are at fault for pricing everything a lot higher. Online stores like Hobbyking (www.hobbyking.com) show just how much cheaper products should and could be in Australia and how we get ripped off time and time again.
It’s the shipping cost.
I’m from Malaysia, things from Peninsula Malaysia(Mainland) are slightly cheaper than in East Malaysia(North Borneo).
mostly are the cost for shipping.
Different part of world, different shipping price.
Hmm – because telstra price matches international competitors?
It is the same for many items. I have a French car and it is cheaper to pay to import parts from th UK + shipping than paying the local parts price. And this was before the AUD/Pound Sterling exchange
hit 0.58p heights. Part of the price differential has todo with the high costs of doing business in Australia, but even accounting for that, some companies love taking Aussies for a ride all the way to the bank!
Tim, I am not talking about price matching international competitors. I am referring to a global brand selling direct to the public (via shopfronts and the internet) offering different pricing for idential products in their own outlets in different countries.
Same with textbooks and even magazines. Unfortunately places like Amazon.com won’t allow Australian’s to purchase US magazines. They are often approx 50% cheaper, even when you factor in international postage. If I purchase 2 magazines from Australia eg at Mag Nation it is usually equivalent to the USA subscription rates and by the 3rd issue I would have covered the international postage.
Globalisation has many advantages, but old paradigm business models that dictate market regions such as Apple & Amazon should be dispelled by new market forces. All I can see is blatant profiteering. I wait in hope.
An interesting article from a Telstra employee. I mean have you compared Bigpond prices for broadband against its competitiors? e.g. wireless.
Stop worring about what the overseas prices are and start working on how you can provide better value to your local client base.
As an apple user your article has struck a chord with me! I also agree that the price differential is unfair BUT there are things to consider such as market size impacting shipping costs, exchange rate differences, import duties, export duties (from the US) paying double taxes (in Australia and in the US). The list could go on. I am not making excuses and I think that the price per unit could drop substantially and sustain a healthy profit margin but do we really want this from certain companies?
I often see stuff overseas about half price in the US.
Here is what I DON’T get. I bought a microphone MADE IN AUSTRALIA while in the US for HALF THE PRICE of Aus retail. You can’t blame that one on shipping
Jon, had a similar experience with a non-IT product – a bottle of Australian wine in New York for $US9 ($A10.20 at the time) and it sells here for minimum $A17. Even with the taxes and shipping costs, that is a huge price to pay for a local product at home…..
As I do not buy many products so I,am not conversant with the prices, but as a shareholder of Telstra I,am very aware of the share price, and if Conroy keeps persisting with his idea of wrecking Telstra, I wonder how that will affect the products and prices in IT businesses in Australia.
Telstra may be poorely managed because they lost many customers by charging too much for their broadband services and even Telstra shareholders moved away from them.