Apple makes beautiful things but while beauty can be only skin deep, you may need to dig a little deeper to understand the iPad mini. At first glance it’s easy to dismiss the mini based on specification and pricing as some kind of booboo by Apple. The small tablet space has become very competitive with consumers expecting a lot in a pocketable package for a low price. In this market the iPad mini is simply too big, too expensive and too slow for most people. Great design and the Apple brand will be enough to justify premium pricing for a few but dig a little deeper – the reasons expectations are so high from a small tablet is that most are being sold to underpin wider ecosystems, so margins are slim while specifications remain high. That means we now have some very good 7inch tablets at around £200, and lots more to come. You might not have access to 400,000 apps but these tablets do everything that most people need, at a price were their willing to take a risk, and because of that they are flying off the shelves.
Apple on the other hand has built its success on making money on every element of the ecosystem, hardware, software, services, etc. The iPad mini demonstrates that Apple don’t see a need to change this anytime soon but they do need to protect their customers from the Amazon and Google invasion. One of Apples great strengths is selling more Apple to their existing customers, constantly building engagement and loyalty. Possibly the greatest risk to Apples’ success is when an existing customer steps out and tastes the forbidden fruit of another ecosystem, because at that moment the premium for being an Apple customer can seem a little too rich.
So, what is the point of the iPad mini if it is not designed to compete with Kindle HD or Nexus for the masses? It is for all those existing Apple iPhone customers who would like an iPad but cannot come to terms with £399 and just may consider being naughty with a Kindle HD or a Nexus at £200. Apple could have reduced the price of iPad2, but then the iPad4 would look too expensive. By introducing iPad mini, Apple is attempting to lower the entry point just enough to keep existing Apple customers from drifting into new ecosystems while not sacrificing their premium pricing. With the iPad mini Apple is acknowledging how good the competition has become, but is continuing to fight on its own terms.