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Applemania Strikes Again as iPad 2 Bedazzles the iCrowd

By Mike Martin MacNewsWorld ECT News Network
Mar 14, 2011 12:31 PM PT

Best Buy employees in Columbia, Mo., passed out 20 "golden tickets" to dozens of people waiting in a morning line. Rather than opening the coveted gates to Willy Wonka's chocolate factory, however, the tickets offered first dibs on the purchase of an Apple iPad 2.

Applemania Strikes Again as iPad 2 Bedazzles the iCrowd

It was a gimmicky way to address a product shortage that played out in communities across the U.S. Authorized Apple dealers including AT&T, Verizon Wireless, and The MacXprts Network -- which started a waiting list when Apple announced iPad 2 March 2 -- were short supplied.

The initial shipment was not enough to meet demand, Best Buy operations manager Ben Cox told the Columbia Missourian, reassuringly noting that his store would probably have plenty on hand within weeks.

The limited iPad 2 supply was "absolutely a smart marketing strategy to make it seem hard-to-get," said New York Computer Help (NYCH) CEO Joe Silverman, whose firm is a certified Apple support professional servicing iPads and other Apple products.

"Apple first likes to hype a product, and then sell out of it," Silverman told MacNewsWorld. "Their low supply strategy, I believe, is intentional, to make consumers keep wanting more."

Apple did not respond to requests for comment.

I, Tablet

Introduced last April, iPad the first has dominated consumer electronics ever since, by some estimates capturing 75 percent of a tablet market just now seeing penetration from competitors such as Samsung's Galaxy Tab and the Motorola Xoom.

iPad mania may even affect other products, with analysts such as Gartner predicting 10-15 percent laptop and notebook sales declines as consumers move to tablet computing.

With a faster chip, and a lighter and thinner design, iPad 2 promises to take an even larger market bite. Apple sold nearly a million units in its first weekend alone -- well ahead of its predecessor -- according to analyst estimates. The first iPad sold 1 million units 28 days post launch.

Most iPad 2 buyers -- 60 percent -- already own an iPad, according to Global Equities Research analyst Trip Chowdhry.

And virtually every iPad 2 buyer owns an Apple product of some sort, Chowdhry noted, a testimony to the company's innovative products and iconic CEO.

"Steve Jobs is excellent at marketing," said Darren Hayes, Ph.D., computer information systems program chair at Pace University's Seidenberg School of Computer Science and Information Systems.

"He has given the world aesthetically pleasing technology, where previously computers only came in black, white or gray," he told MacNewsWorld. "He has made 'geek' cool and inspired youth to quickly adopt his technologies, even when their choice of device did not bring the best functionality or the best price."

Best Buy?

Best price has never been an Apple forte, and the iPad 2 -- at US$499-829 -- is no exception. Nonetheless, consumers aren't complaining. Not only are repeat customers returning, but new generations are lining up, too.

"The iPad was bought by a lot of the younger generation who already had an iPhone," NYCH's Silverman explained. "iPad 2 buyers are an older, more PC-minded group. They are the folks who were a little shy to jump onboard with the first iPad, but have been coaxed into the iPad 2 by friends and family."

New customers are also bringing new uses, including broader business apps, Silverman said.

"As consumers working on the iPad got comfortable with typing, it doubled also as a remote access computer," he said. "Businesses have also seen how easy it is to set up remote capability from their iPads."

Apple of your i

From the iMac, iPod, iPhone, and now two generations of iPads, the i's have had it big time over the course of an Apple corporate renaissance that reversed a dark time for the company when, as a $2 stock, it received a Microsoft injection of $150 million 14 years ago, Pace's Hayes recalled.

Since then, "Apple has truly found its identity," especially in the tablet market, Joe Silverman said. "Dell, HP, Toshiba, Lenovo and others still haven't found a way to separate their tablets from their notebook and smartphone products. Plus, while the Android operating system is smooth, its apps lack the variety and loyalty that Apple has."

The iPad's success probably reflects Jobs' guiding philosophy: Think Different.

While many of his peers were downsizing or right-sizing after the global economy's 2008 collapse, said Hayes, "Apple chose a different path that Jobs' himself summed up: 'If we keep putting great products in front of customers, they will continue to open their wallets.'"

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