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Welcome to the Age of Ultra-Premium Flagships

2017-10-03
Samson started it with the note 8lg quickly joined with the v30 of course Apple took it to a whole new level with the iPhone 10 and now there's rumors that even Google will join with their pix alignment as well I'm talking about this new trend of ultra premium flagships of course but what are they and why are they so damn expensive I'm Martin from toccata doing a guest episode for Android authority and let's find out so what is an ultra premium flagship I mean just half a year ago we already thought that flagships were you know premium like top-of-the-line it doesn't get any better premium but apparently we were wrong Apple Samsung and LG have all chosen a dual flagship strategy one flagship for the normal mortals and another ultra premium one for the more enthusiastic or simply more wealthy ones and people have been talking about gradually rising prices in their flagship smartphone market since forever but ultra premium flagships represent a whole new trend I think not only was the jump in prices much larger than in previous years I mean these phones went up from 6 to 800 dollars all the way up to a thousand now but device makers also seem to keep their regular reflections around to signaling that the regular and the ultra premium flagships were aimed at different types of consumers and should have different value propositions so what is going on here in one word luxury and before you go down and start throwing your Rotten Tomatoes at me I mean at your screen because it's too obvious let me unpack this term first this handbag from Louie Vuitton costs nine hundred and ninety five euros here in Germany in other words it is priced exactly like an ultra premium flagship did that shock you probably not given that it is one of the most popular fashion accessories ever made but now we have all accepted that luxury bags just cost a ton of money but if a bag costing a thousand euros didn't shock you at all then maybe neither should an iPhone or a galaxy see this back perfectly captures what luxury is about it's a piece of leather with a few zippers on it that holds your wallet your phone and a few other items it doesn't have any functional benefit over a $20 back ok maybe the quality of the leather a little better that design is a little nicer where it wouldn't go out of fashion like a regular bag would but to anyone comparing these two bags on a functional level the louisvil tone seems like a terrible deal and yet millions of people buy it features functionality and performance are what most tech enthusiasts including me think make a device valuable these objective metrics make comparing devices quite straightforward but they are not the only way to assess the value of a phone one plus adds value to their phones by having a thriving online community fair phone adds value by having really good environmental policies and by creating a more sustainable phone nokia adds value by playing with lost algin and by giving europeans like me a small glimpse of hope of a European company maybe regaining at least some little role in the consumer electronics of space people are willing to pay for these extras just like they're willing to pay for features and technology that these things also provide value is the key to understanding ultra premium flagship prices the less consumers worry about the basics the more companies can focus on these extras and when people can stop caring about the fundamentals completely the focus shifts nearly entirely on the extras this is perfectly illustrated by our Louis Vuitton bag functionality here is basically not a concern at all banks are functionally close to identical because of this consumers can switch their picki feature focused brains off which in turn leaves space for their aspirational social or emotional brain to make decisions people who choose this 1,000 euro bag don't do it because they excessively compare features between it and other bags or watch in-depth reviews instead they buy it for whatever is layered on top of the functionality maybe they value that Louis Vuitton has a long history of excellent that they have my stores or my staff or maybe they just like letting others know that they can afford a 1000 euro handbag so how does this apply to phones well just a few years ago switching that picky and feature focused the brain of yours off could have led to you ending up with a genuinely bad phone but as the smartphone market has matured that is becoming increasing unlikely phones now look really similar and they also have very similar functionality in real-world performance years of fierce competition have made sure that they are basically no more bad phones on the market sure we enthusiasts might net big but the average consumer that just wants to scroll through social media feeds and chat with friends all modern phones above a certain price range will work admirably well if you think about it phones in this regard are becoming more and more like bags and as people have to worry less and less about whether a phone will be able to perform its basic tasks well enough they will start carrying more and more about whatever is layered on top of that core feature set so companies with a little extra could benefit from this just think about their phone their concept is to use sustainably sourced materials and sustainable processes to build a phone that isn't terrible for the environment a phone that is repairable and so on this of course makes their phones much more expensive than comparable expect mainstream devices to end up with a phone that isn't prohibitively expensive fair phone has to use mid to low end specs four years ago when they launched the fair phone one mid to low end specs meant terrible performance two years ago when they launched a fair phone - it meant acceptable performance if they were to launch the fair phone three with the same strategy today or sometime in the future performance would probably be just fine mid-range specs today are great and low-end specs are fine too because of this many people who were interested in the mission of fair phone but were put off by having a really subpar experience before could become potential customers as the worries about the specs disappeared the added value of environmental friendliness becomes more and more attractive now I don't know how many people actually care about the environment enough to choose a phone purely based on this concern but this trend is pretty unmistakable which finally brings us to our ultra premium flashers while features might still be somewhat of a concern for low to mid-range phones they are certainly not an issue on the premium side of things anymore it is close to impossible to find a flagship phone that doesn't have a great camera a great screen and enough processing power to handle anything the average consumer wants to do with ease unless you have a very specific need for say an aspen or some other niche feature the decision you make when buying a flagship mostly comes down to personal preference and the extra stuff these companies are carefully adding on top of their devices they all have their own special blend of stuff of course like emphasizing the fact that they are an anniversary edition for example but one aspect that they all seems to push quite hard is simply branding and through it luxury especially Apple and Samsung have built incredibly strong and premium brands over time and they are leveraging them hard they want you to think that owning a one thousand dollar iPhone 10 where a note eight is a fashion statement the same way that owning a one thousand dollar Louis Vuitton bag would be sure phones don't last as long as fancy bags but they are with us 24 hours a day so they are great at making a statement they are increasingly not just tools but objects of desire and prestige now I'm not saying that ultra premium flex shirts aren't technically better than some cheaper phones or that they aren't more expensive to make but most of the increased price can be explained by the fact that they have become objects of desire and prestige so what does this mean for the future of phones I think we'll go from the industry simply focusing on building the most functional phone possible to having a much larger variety of value propositions price conscious consumers will of course have an endless sea of well priced options to choose from there always be companies catering to that audience and they'll have an easier time than ever because making a cheap smartphone that doesn't suck is easier than ever at the same time I expect an explosion of phones that focus on the extras phones that are good for the environment firms that care about your privacy forms that make you feel luxurious you name it the smartphone industry will become a little more like that of backs or clothes in general where you can buy a t-shirt for five dollars or another functionally similar one for 500 so I'd like to know what you think 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