Wal-Mart Fires First in iPad Air Discount Battle

Source: Apple.com
Once again, Apple’s (NASDAQ:AAPL) latest product release has kicked off a pricing war between various major retailers. Last month Wal-Mart (NYSE:WMT), Target (NYSE:TGT), and Best Buy (NYSE:BBY) engaged in a race to the bottom for the lowest possible price on Apple’s iPhone 5C. This month, the price competition is over Apple’s new 9.7-inch iPad Air.

As usual, discount retail giant Walmart initiated the price slashing by offering the 16GB iPad Air for $479. This is $20 less than Apple’s standard 16GB iPad Air sticker price of $499.

Walmart’s lowered iPad Air price precipitated similar offers from Target, Staples (NASDAQ:SPLS), and Best Buy. Target and Staples soon matched Walmart’s price, although Staples’ iPad Air sale is due to end on November 9. Walmart and Target offered no time limit for their iPad sales. However, Staples only recently acquired the iPad after several months of selling various Apple accessories through its website.

Best Buy also offered to match Walmart’s price, but only if customers specifically requested a price match, reports the Los Angeles Times. Customers must also show Best Buy proof of the $479 iPad Air price at a competitor’s store.

Many industry watchers were surprised when Walmart began offering the 16GB iPhone 5C for $79 soon after it was released. Walmart’s initial iPhone 5C price was $20 less than the $99 price that Apple and its other retail partners were selling the device for. It should be noted that most retailers don’t go below Apple’s standard prices, since the company typically provides strong marketing incentives for companies that keep product prices above a certain level.

However, Walmart’s discounted iPhone 5C price soon prompted the other retailers to follow suit, and by early October, both RadioShack (NYSE:RSH) and Best Buy were offering customers a  $50 gift card with their iPhone 5C purchase that brought the total price of the iPhone 5C down to $50. However, Walmart went even further and now offers the iPhone 5C for $45 when purchased with a two-year service contract.

Regardless of which retailer eventually wins the latest Apple-product pricing war, it appears that the real winners will be shoppers that are looking to buy a new iPad Air this holiday shopping season. As Tim Cook predicted in Apple’s fiscal fourth quarter results earnings call, “it’s going to be an iPad Christmas.”

Here’s how Apple traded on Monday:

Apple Inc. Stock Chart - AAPL Interactive Chart - Yahoo! Finance

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