Success Secret of Apple: How Does It “Manipulate” Consumers’ Behaviors

Abstract

Apple is one of the most successful companies in the electronic products industry. Its success is indispensable to its effective marketing strategies. This paper focuses on analyzing the psychological trick it used in its marketing strategy, mainly the endowment effect and status quo bias. It investigates how Apple uses these cognitive biases to attract newcomers to use its products and how it cultivates loyal consumers. The endowment effect refers to a circumstance to which an individual attaches higher importance to the object that they own than the same object they do not own. Apple's showroom enables consumers to play around with its products which gives the consumer a sense of ownership that make consumers become more painful to relinquish its product. Status quo bias describes the circumstance where people prefer to maintain the current state and are reluctant to change. It helps Apple to keep the existing consumers around, which also gives Apple more incentive to constantly upgrade its products and induce consumers to buy. Lastly, this paper will discuss what consumers could do to avoid being “manipulated” by Apple’s marketing strategy and falling into the consumption trap.