Behind the iPhone falling below the floor price: Apple, which was surrounded by domestic mobile phones, was very anxious
For a long time, the price of iPhones sold on Apple's official website has been known for being strong, and it is generally only lowered or removed from the shelves after the release of new products. But now, under the encirclement and suppression of domestic smartphone manufacturers, Apple's official website has also begun to take the initiative to promote.
On January 15, 2024, Apple's official website will open a Spring Festival promotion, and iPhone, iPad, Mac and other products will be discounted, with price reductions ranging from 50 yuan to 800 yuan. Because before the release of new products, Apple's official website rarely took the initiative to reduce prices, and on January 15, the topic of "Apple's official website rarely cut prices" topped the Weibo hot search list.
Although after the Spring Festival promotion, the price of the sales terminal on Apple's official website is still one level higher than that of the channel, and consumers are likely not to buy products on Apple's official website, but this move has a strong meaning. Due to the price stability, Apple's official website selling price has historically been regarded as the price anchor for Apple products. The price of Apple's terminal official website has been reduced, which also means that the channel price will fall further. On January 17, 2024, the price of Tmall Apple Store will be reduced, and the iPhone 15 series will drop by 1000 yuan, of which the price of the 128G version of the iPhone 15 will only be 4999 yuan. It is reported that this is the first time that the official channel price of iPhone 15 has fallen below 5000 yuan.
So the question is, as the head player in the smartphone industry, the iPhone has always been the "hard currency" in the high-end market, why is it in a hurry to reduce prices at the beginning of 2024?
Behind the world's No. 1 rank, the iPhone is losing the Chinese market
In fact, on the whole, in 2023, the sales data of the iPhone is not bad. According to data disclosed by IDC, in the global smartphone market in 2023, the sales of iPhones will be 235 million units, a year-on-year increase of 3.7%, and the market share will be 20.1%.
A longitudinal comparison shows that Apple is not only the only manufacturer among the top three in the global smartphone market in 2023 to achieve positive sales growth, but also surpassed Samsung for the first time to win the first place in annual sales.
However, in the Chinese market, Apple has suffered a Waterloo. According to data disclosed by IDC, from Q3 to Q4 of 2023, iPhone shipments fell by 4% and 10.6% year-on-year, respectively. You know, the fourth quarter is the key node for Apple to launch new products, and iPhone shipments are still falling, which shows that Chinese consumers' enthusiasm for iPhone has become increasingly cold. Entering 2024, iPhone sales in China still haven't picked up. According to a report disclosed by Jefferies analysts, iPhone sales in the Chinese market fell by 30% year-on-year in the first week of 2024.
Apple's performance is also showing signs of peaking due to the poor performance of the iPhone in the Chinese market. According to the financial report, in the fourth quarter of fiscal year 2023, Apple's revenue in Greater China was US$15.08 billion, down 2.5% year-on-year, and the market estimate was US$17.01 billion, and the actual revenue was nearly US$2 billion less than the estimated revenue.
In fact, Apple has long seen that the attractiveness of the iPhone to Chinese consumers is gradually declining, and in order to save its performance, it has personally promoted it several times before. In 2019, Apple officially participated in the event, consumers can save up to 500 yuan and enjoy 24 interest-free installments when buying the iPhone 11 series at the Apple Store Tmall official flagship store, and in 2020, Apple officially participated in the 618 event, and all products in the Apple Store Tmall official flagship store participated in Tmall's cross-store purchase and reduction activities, with a 20% discount on the whole site. From this point of view, at the beginning of 2024, Apple suddenly started the Spring Festival promotion, which is not accidental, but a continuation of the strategy of exchanging price for volume in the context of declining iPhone sales.
Domestic mobile phone manufacturers accelerated involution, and Apple was encircled and suppressed
The reason why Chinese consumers are no longer keen on buying iPhones in the past two years is, on the one hand, because the iPhone has not been updated much and its attractiveness has weakened, on the other hand, it is actually because domestic smartphone manufacturers have intensified their involution competition and launched many highly competitive products, which have attracted the attention of more consumers.
For example, in September 2023, Huawei quietly released the Mate 60 series mobile phone, and the biggest selling point of this product is that it is equipped with a self-developed Kirin 9000S processor. Because the Mate 60 series mobile phones have strong core competitiveness, netizens call it a "competitive machine" and have snapped up the phone.
According to the survey data, six weeks after its release, the sales of the Huawei Mate 60 Pro reached 1.6 million units. Along the way, Apple also launched the iPhone 15 series. Obviously, the Mate 60 series phones have greatly diverted the appeal of the iPhone.
You must know that in 2023, due to the limited production capacity of the upstream industry chain, Huawei Mate 60 series mobile phones have been in short supply. With the gradual recovery of the supply chain, Huawei's mobile phone shipments will further climb in 2024. Jiemian News quoted relevant sources from Huawei as saying that Huawei plans to ship 60 million-70 million smartphones in 2024, which is difficult not to further weaken the influence of iPhone.
In fact, not only Huawei has launched highly competitive products recently, but Xiaomi, OPPO, and vivo have also made efforts in the field of high-end machines to face Apple head-on.
For example, in October 2023, Xiaomi released the annual flagship mobile phone Xiaomi 14 series, the world's first third-generation Snapdragon 8 mobile platform, the main camera uses a new light and shadow hunter 900 sensor, supports variable aperture adjustment, and the starting price is only 3999 yuan, which is very cost-effective.
The Wall Street Journal broke the news that during the Double 11 in 2023, the Xiaomi 14 series of mobile phones performed well, with the first sale from October 31 to November 10, and the total omni-channel sales of this series of mobile phones reached 1.4474 million units, setting a record for Xiaomi's high-end flagship sales.
In fact, combined with industry research data, under the background of the peak of the mobile phone industry, domestic smartphone manufacturers such as Xiaomi, Huawei, and Honor have indeed greatly grabbed the market that belongs to iPhone. BCI survey data shows that in Q4 2023, the activation of Xiaomi, Huawei, and Honor mobile phones increased by 38.4%, 79.3%, and 12.9% year-on-year, respectively. On the other hand, iPhone activations fell by 10.6% year-on-year.
Vision Pro is coming soon, Apple has no "new story"
In fact, Apple has long realized that the smartphone market has peaked, and in the context of intensified market competition, the imagination of its own mobile phone business is gradually narrowing, so it is actively laying out MR "stories".
In June 2023, Apple launched its first MR headset, the Vision Pro. Apple CEO Tim Cook believes that the Apple Vision Pro is "a new enhanced display platform, a revolutionary new product".
It is undeniable that the hardware configuration of the Vision Pro is indeed excellent, equipped with Apple's own M2 processor and a core frequency of 3.49GHz. Based on the M2 and R1 dual chips and 12 cameras, the Vision Pro can be similar to an AR device, displaying the external environment on the screen in real time, and by adjusting the knob, it can also achieve a fully immersive VR effect.
However, the Vision Pro may hardly resemble the original iPhone, which was a sensation and revolutionized the tech industry. This is mainly due to the fact that the price of the Vision Pro is high and the product is not mature.
At present, the Vision Pro has been launched on Apple's official website in the United States, with a starting price of $3,499 (about 25,000 yuan), which is about three times the price of the iPhon 15 Pro. With such a high price, it is obviously not affordable for ordinary consumers. Korean media Pulse quoted industry insiders as saying that the initial sales target for the Vision Pro was 1 million units, which was later lowered to 300,000 units, and then lowered to 150,000 units before the release. By comparison, the original iPhone sold 1 million units in just five days on sale.
In addition to its high price, the Vision Pro's ease of use is also questionable. According to a tech blogger, only about 50% of the pre-installed apps in the Vision Pro are optimized for the Vision Pro, and the other apps can only run in windowed iPad OS mode. From this point of view, after the launch, the Vision Pro may attract much attention, but because it is difficult to impress mass consumers, it is also difficult for it to contribute to Apple's outstanding performance.
On the one hand, the influence of Apple's basic iPhone in the Chinese market has accelerated, and on the other hand, the new story of Vision Pro, which Apple has carefully constructed, is not imaginative, and it is naturally difficult for the capital market to look up to Apple.
On January 12, 2024, Hedgeye, an investment research firm, listed Apple as a short-selling target. Hedgeye said that Apple's revenue growth will be bleak in 2025 due to weak iPhone sales and a lack of innovation, and Apple's stock price is expected to fall by 30%.
All in all, with the gradual improvement of the competitiveness of domestic smartphones, consumers in the Chinese market have turned to favor domestic mobile phones, while the iPhone with insufficient innovation has lost its competitiveness in the Chinese market, and Apple's frequent promotions have become a helpless countermeasure.
Although the Vision Pro is Apple's long-term layout product, its high price and poor ease of use indicate that it is difficult for it to take over the iPhone and become Apple's new revenue pillar. This situation has made it difficult for Apple to create a new market story, exacerbating the brand's woes in the Chinese market.
At the same time, Chinese mobile phone manufacturers are gradually moving into overseas markets and showing strong global competitiveness, which brings more serious challenges to Apple. In this era of change, Apple's future may indeed face considerable challenges, requiring a re-examination and adjustment of its strategy in the Chinese market.