At the largest price cut in the history of the Chinese Festival, Apple is really anxious

Observer.com

2024-05-20 21:44Posted on the official account of Shanghai Observer.com

[Text/Observer.com Lu Dong]

The curtain of 618 has not officially opened, and Apple has taken the lead among mainstream mobile phone manufacturers to announce price cuts.

On the morning of May 20, Observer.com inquired about Tmall Apple's official flagship store and found that all products, including mobile phones, smart watches, tablets, laptops, headphones and accessories, participated in the price reduction. In the next week or so, the maximum price reduction of these products will reach 2,300 yuan.

Among them, the iPhone has the biggest discount. As Apple's main product, after superimposing the official discount and Tmall coupons, the starting price of iPhone15 and iPhone15 Plus has been reduced by 1400 yuan, the starting price of iPhone15 Pro has been reduced by 1900 yuan, and the discount of the 1TB version has reached 2300 yuan, while the starting price of iPhone15 Pro Max has been reduced by 2050 yuan, with a maximum discount of 2250 yuan.

Screenshot of Apple's Tmall flagship store

Not only the new iPhone, but also other major Apple products have basically given obvious preferential margins.

For example, under various preferential conditions, the starting price of Apple Watch Series 9 has been reduced by 700 yuan, and the starting price of 10.9-inch iPad and iPad mini has been reduced by 300 yuan. The price of MacBook Air with M2/M3 chip starts at 600 yuan; AirPods series price reduction starts at 300 yuan; The iPhone 14 series and iPhone 13 series, which are still on sale, have been reduced by at least 1,000 yuan and 900 yuan respectively.

In addition to Tmall, Apple has also given a considerable degree of discounts on other e-commerce platforms such as JD.com. Some analysts pointed out that this is an important node, because Apple has never carried out such a large official price reduction in the Chinese market. On the contrary, it is a domestic brand, and the price reduction is not as positive as Apple. At present, on platforms such as Tmall, Huawei, Honor and other manufacturers are in the most conspicuous position, and what they release is new product promotion information, rather than preferential information.

Why would Apple let go of its once arrogant posture and aggressively cut prices in the Chinese market? First of all, Apple has considered cleaning up the inventory of old models, and products such as the recently launched new iPad Pro have not participated in price reductions. But more importantly, we still want to rely on price cuts to boost sluggish sales.

According to IDC data, in the first quarter of this year, iPhone shipments in the Chinese market fell by nearly 7% year-on-year, ranking fourth from the first place in the previous quarter, while Honor and Huawei shipments increased by 13% and 110% respectively. Looking at the tablet market in the same period, while the overall growth of the Chinese market was 6.6%, iPad shipments in China fell sharply by more than 10%, while Huawei's tablet increased by 10.6%, becoming the first in the Chinese market for the second consecutive quarter.

Affected by this, Apple's revenue in Greater China fell by more than 8% year-on-year in the first quarter of this year.

Judging from the performance of the past two years, Apple has also become more and more dependent on boosting sales through price cuts. For example, during the 618 period last year, the iPhone14 series ushered in the "largest price reduction in history", and during the subsequent Double 11 period, the newly released iPhone15 series had a maximum price reduction of more than 1500 yuan, helping Apple become the first mobile phone shipment in China in that quarter. For example, in March this year, Apple briefly lowered the starting price of the iPhone 15 series by 1,000 yuan, which affected iPhone sales in China increased by about 12% that month, a significant rebound compared with the previous two months.

The iPhone look is the same

Prices can boost sales by cutting prices, and Apple's trick seems to be easy and effective.

But for a technology company like Apple, which supports U.S. stocks, the continued reliance on price reductions and promotions is obviously quenching thirst. Observing the consumer electronics market in the past two years, although the overall economic environment has been negatively affected, domestic mobile phone manufacturers still try their best to attract consumers through innovation, generative AI, aesthetics, imaging, satellite communication and folding screen and other innovations, so that Apple's cookie-cutter appearance and micro-innovation are somewhat dwarfed.

In fact, the American media has long been unable to stand it, and has pointed out Apple's problems more than once. Bloomberg also posted yesterday (May 19) that Apple was caught off guard in the generative AI race and that the company needs to change its strategy if it wants to catch up.

In fact, although the mobile phone market has long become a red ocean, as long as manufacturers can come up with differentiated innovations and constantly solve the pain points of consumers, they can still gain the favor of the market, and domestic mobile phones such as Huawei Mate60 are examples.

Regarding Apple's current situation, IDC pointed out that although the price adjustment and promotion are continuous, and the iPhone 15 Pro Max is the best-selling model during the Spring Festival, Apple is facing increasing challenges and pressure from competing products, and urgently needs to upgrade and innovate from software and hardware to attract consumers.

In short, if Apple has only one way to cut prices, it is destined to not go far.

This article is an exclusive manuscript of Observer.com and may not be reproduced without authorization.

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