The sales of iPhone models has always been the talk of the town as the aspiring users always want to know the most popular iPhone before they decide to buy one. Every year Apple releases a number of iPhone models catering to various segment of smartphone buyers. This year, however, Apple has launched 4 models that have made the equations rather more interesting when it comes to competing with each other.
The comparatively low priced iPhone 11 has emerged as the best selling iPhone in the second quarter ending June 2020. According to the latest report from CIRP, iPhone 11 accounted for over one-third of the total iPhone sales in Q2 2020.
On the other hand, combined sales of iPhone 11 Pro and iPhone 11 Pro Max beat the market expectations despite having exorbitant price tags. Starting from $999 onwards both of these models accounted for little over 30% of the total iPhone sales in Q2 2020.
Apple launched three models of iPhone – iPhone 11, iPhone 11 Pro and iPhone 11 Max- in October last year. Immediately after the launch of the new models Apple discontinued all the variants of iPhone XS – the model Apple launched just a year ago – in a bid to push the sales of iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max. It’s quite evident that Apple’s strategy has paid off well as all the three models, together, accounting for 65% of the total iPhone sales even in its third quarter.
In April Apple surprised everyone by launching another model iPhone SE – the cheapest iPhone launched ever by the company. Priced at just $399 Apple iPhone SE 2020 is strategically introduced to acquire a sizeable share of price-sensitive markets like India. The device indeed turned heads but due to the global outbreak of novel Coronavirus which has bought the market to stand still, sales of iPhone SE 2020 remained below expectations. The CIRP report estimate that 1 out of every 5 iPhone sold during Q2 2020 was iPhone SE. It’s important to note that iPhone SE was available only for 2 months in the quarter as compared to all other models that were
Apple completely stopped disclosing the sales figures of iPhone but the above trends clearly highlight the increasing popularity of iPhone 11 Pro and iPhone 11 Pro Max despite their aggressive price strategy that attracted enough of criticism initially.
The trends also indicate that price is no more a hindrance for aspiring iPhone buyers. During the same period a year ago, the comparatively lower-priced model of iPhone – iPhone XR – accounted for over 45% of the total iPhone sales, while the rather expensive iPhone XS and iPhone XS Max was able to capture below 20% of the total iPhone sales.
Apple reported $260.17 billion in revenue in FY’19 and 55% of it came from the sales of iPhone. Similarly, in Q1 2020, worldwide revenue from iPhone accounted for 57% of the company’s total revenue. These figures are testimonials to the fact that the people are still wanting to buy iPhone irrespective of their increasing ASP (Average Selling Price).
The study also highlights another interesting trend in consumer behaviour. Unlike a year when over 30% of iPhone sales were driven by a year-old model of iPhone models, ie iPhone 8/8 Plus and iPhone 7/7 Plus, consumers are now more fascinated about the latest technology introduced in the latest models of iPhone. Consequently, in Q2 2020, the sales share of the older version of iPhone shrunk below 18%.
All the above trends indicate that the buying power of consumers is constantly increasing with each passing quarter. Reading the pattern, other smartphone companies who were largely focused, and dominate, on the entry and mid-segment smartphone market have set their eyes on the premium segment. Few of the recent launches, i.e. Mi Note 10, Vivo X50 and Oppo Find X2, by these smartphone manufacturers are set to change the market equations. However, with iPhone SE 2020 Apple has placed a strategic bet to shake the ground for these manufacturers, mainly in developing markets like India.
The next few quarters are going to be interesting enough as companies, including Samsung, are leaving no stone unturned to eat into the market of Apple and others. As consumers are reportedly holding their plans to spend on electronics amid the Covid-19 outbreak, it would be interesting to see how the market responds to smartphone manufacturers.