Last week as the iPhone 5 went on sale, there was a real frenzy as people waited in line for days to get their hands on one. Some even went as far as to pay someone else to wait in line for them.
A marketing expert at San Diego State University, Steven Osinski, talked to KPBS about whether there's something about the iPhone 5 to cause people to react this way, or if it's simply a matter of media hype.
Osinski: Apple makes high quality products. There are a couple of enhanced features on the iPhone 5: a larger screen, greater wireless capability, and faster speed. But if that would encourage people to stay out overnight, line up and go through "Apple-mania," is a good question. So in that regard, I think it's media hype.
KPBS: In the first couple of days following its launch, Apple said it sold more than 5 million units of the phone, which is less than what it was actually expecting. What happened here that sales didn't live up to expectations?
Osinski: It was basic economics. There weren't enough available phones ready to be sold. Apple ran out of inventory. Wall Street projected that 2 million phones would be sold and there wasn't the inventory to match that projection. As you can see this week, the share price of Apple has gone from a record high of over $700 to significantly lower.
KPBS: So that's a matter of supply and demand that the stock took a hit, or is it the psychology of the market?
Osinski: The market is very fickle. But simultaneously there's more marketing factors at play here. People don't have the disposable income that they used to have, so it's a cheap thrill in a sense. It's like Starbuck's Coffee, paying $4 for a latte. It makes you feel very good about yourself, but simultaneously, it's not that large of an investment.
Osinski said some Apple fans have gone as far as to tout the iPhone 5 as a form of stimulus that could lead us out of the recession.
