Value depreciation factors for new and remanufactured high-technology products: a case study on iPhones and iPads

Abstract

Governmental regulations for expansion of e-waste and customers’ awareness of green goods drive remanufacturing practices in high-technology electronic products. Selling remanufactured high-technology products is a challenge because of the shorter residual life of usage and potential cannibalisation of new items. Smartphones and tablets, as hi-tech products, are replaced by new generation models quickly due to rapid development. Products belonging to earlier generations become less demanding. Customer’s acceptance for outmoded remanufactured items is even less. Learning how value depreciated is vital for the sellers to make a wise price decision for these new and remanufactured products belonging to various generations. This study leverages transaction data of iPhones and iPads from eBay, uses partial least square method to explore the factors that affect value depreciation rate and price differentiation between new and remanufactured products. Variables which are categorised as marketing elements, technology features, appearance design, and customer attention are hypothesised to be critical to value depreciation. The result differs in iPhones and iPads but shows some consistency that time since release, product thickness, camera resolution, and fans/hits ratio are highly correlated to the value depreciation rate. ApplePay slows down the rate for iPhones while cellular data function accelerates the rate for iPads.