2020 appears to be the year Apple will finally take the gloves off and go toe-to-toe to beat the best.
Over the last few years, despite the hype, the iPhone hasn’t been the awe-inspiring product that it once was. In fact, from around two to four years, Apple has lost its shine, especially where their handsets are concerned and the last truly successful iPhone was the iPhone 6S which launched way back in 2015. In 2019, iPhone sales have paled in comparison and consumers the world over are finding much better options with Android handsets as they are providing incredible value for money.
Speaking of Android rivals, it is the brands from China that are making the biggest impact and have effectively dented the sales momentum which iPhones had. Users across the globe have now started moving to cost-friendly but extremely capable devices from the likes of Huawei, which is the biggest thorn in Apple’s chest as they offer handsets with ground-breaking technology and have also overtaken Apple where sales are concerned. With this in mind, it isn’t surprising that Apple’s global smartphone market has diminished to 13 per cent in the third quarter of 2019 in comparison to 16 per cent at the end of 2015.
This situation is projected to worsen as Apple is expected to ship a mere 200 million iPhones this year and this will mark another year of diminishing iPhone sales.
However, 2020 is set to be completely different with Apple poised on the brink of a comeback.
With the latest iPhones, Apple has devised a smart strategy to expand the iPhone ecosystem. As mentioned earlier, competitive pricing from Apple’s rivals has landed a serious blow to iPhone sales. With the last few devices, Apple has launched incremental updates and they have been forced to play catch-up with the likes of Chinese Android-focused brands like Huawei and OnePlus who are offering cutting-edge features at cost-effective price points. Also, with Apple steadily raising the prices of its iPhones, it has forced the Apple faithful to retain their products for a longer span of time as opposed to upgrading every couple of years.
All this and more are damaging iPhone sales; however, of late, Apple has decided to bite the bullet and opt for a more consumer-centric approach on the pricing front. In an unprecedented move, Apple has reduced the price of the entry-level iPhone by quite a margin and this move seems to be working for the company as iPhone sales have seen an uptick in key markets.
As per a report by The Motley Fool, “Apple reportedly shipped 10 million iPhones in China during the months of September and October this year. The China Academy of Information and Communications Technology points out iPhone shipments in China jumped 6% year over year during these two months.”
These figures provide us with a clue about the iPhone 11’s popularity in China, a country where Apple’s sales were down in recent quarters. What’s even more beneficial for Apple is that the company is witnessing a growth in a country where smartphone sales are declining. Apple managed to beat this slowdown by recording a 5.6 per cent boost in shipments.
Also, the new strategy by lowering the price appears to be working in the price-sensitive Indian market and now Apple is looking to boost its sales even further in the country by introducing the iPhone SE 2 which will hit the right notes in the Indian smartphone space.
The report goes on to add, “Shipments of phones priced between $300 and $500 doubled in India during the third quarter, according to IDC. So Apple will be doing a huge service to its iPhone prospects by launching a cheaper device.”
Apple is now hitting the boundaries in a bid to boost smartphone shipments and the right pricing and brand equity could help it reel in more consumers to the iPhone ecosystem.
However, Apple has another trick up its sleeve that will provide iPhone sales with a major boost — 5G.
5G smartphones are expected to achieve critical mass in 2020 and IDC estimates that around 123 million devices with this new wireless standard will be sold in the next year itself. And, in 2023, 28 per cent of all smartphones will be 5G capable.
The report states, “Strategy Analytics predicts that Apple -- which doesn't have a 5G-capable phone just yet -- will become the leading seller of 5G smartphones next year. The firm believes that Apple can leave Samsung and Huawei in the dust despite entering the 5G smartphone race in the third quarter of 2020. Apple's strong presence in the US and China -- two of the largest 5G markets -- will drive its dominance in the next-generation devices.”
Apple is on a roll and their cards are finally falling into place. With the right pricing that’s infused with cutting-edge technology, Apple will do all it can to end the iPhone’s mediocre showing in 2020.