Joseph Thornley notes that Apple has announced that Canadians will pay 33% more for Apple's DRM-free music than U.S. customers. While U.S. consumers pay 30 cents more per song, the Canadian price jump is 40 cents, despite the fact that the currency difference is now very small.
Canadians Pay More for Apple’s DRM-Free Music
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Not a surprise
It’s not a surprise at all. Just now I was shopping for bikes. On the bike I’m looking at if I convert the US price to Canadian dollars it’s $121 cheaper (629 USD = 668 CAD, bike costs $789 in Ottawa).
Doing the math most things seems to still be priced on the 1 USD = 0.80 CAD. I guess they don’t want to wake up to the fact the CAD sits at 0.941 USD.
I guess if they ignore the value of the Canadian Dollar they can line their pockets quite easily – an extra $121 profit for absolutely nothing has got to be a great business plan.
Not surprizing at all. Consider the following business plan.
1. Canadian is worth less than US dollar.
2. US upgrade is 30 cents.
3. US upgrade should cost less than Canadian upgrade.
4. People like round numbers.
5. Choose next 10-cent increment: 40 cents.
6. Profit!
Plus, one must consider a) when they decided on the price (what was the rate at the time), and b) what they think the currency will do over time (since changing the price frequently would be annoying too).
http://www.propr.ca
Mike,
I round out the numbers in my business. But my banker usually insists I round .32 down to .3, not all the way up to .4. (So did my teachers in grade school, by the way.)