People dont go for cheap. They believe that such low priced providers are best at their price point.
So its the duty of the service providers who offer higher price to convince the user that they are better than their lower priced peers.
Apple is successful because it is able to convince the user. For this they used their goodwill and brand name as values. They also have first mover advantage
Once a user is convinced he will never go for lesser priced peers (i wont use the term cheap)
A product priced less as compared to the price of the competitor products might also be better in quality. There are chances that a cheap product might last for long because of its better quality.
There are also the Chinese products which are cheap and also wont last. But when a brand name is attached to it, the perception changes. So, Cheap or not, its all about branding and goodwill. A person will also trust a lesser priced product and buy it believing the brand value of the company. Likewise, even if a product is costlier than its competitor products, a person will not buy it if there is no brand value attached to it.
