When Apple announced its new iPhone SE and a smaller iPad Pro earlier this week, it was against a backdrop of criticism and disappointment with sales growth. The smaller, cheaper SE was intended, analysts said, to capture the midmarket and stimulate sales in China.
A bit of perspective is needed. In western markets, Apple is operating in a saturated arena and it’s starting to show. In January, Apple reported its slowest growth in iPhone shipments, at 0.4 per cent. But it still sold 74.8 million iPhones in its fiscal first quarter.
Look back at the same quarter in 2013, and the tech giant sold 47.8 million phones. By even the harshest reckoning, Apple is doing okay on that front.
The company has done what it was supposed to. It has sold smartphones to those who want an Apple device, and created a market for tablets that simply didn’t exist prior to the launch of the iPad in 2010.
It tightly integrates its products to make them as easy to use as possible, and many people – although not all – find that once they are embedded into the Apple ecosystem, they stay there.
But not everyone wants the iPhone, a fact that is backed up by the sales of Android phones and the growth in the number of premium phones offered by manufacturers of Google’s operating system.
Apple, meanwhile, has spotted another opportunity to lift its sales – a more premium yet compact device. There’s speculation the iPhone SE could win market share from rivals such as Xiaomi and Huawei in crucial Asian markets. Research firm IHS said Apple was “choosing to aim at an under-served segment of consumers that prefer small-screen smartphones and have been reluctant to upgrade. Importantly, Apple’s competitors have chosen not to target the premium compact smartphone market.”
The company sold 30 million iPhone 5s and 5c phones in 2015. That may not seem like much when compared with the latest models, but it’s a significant chunk of the market who seem to want a smaller-sized, smaller-price phone, without sacrificing on specs. And it’s big enough that Apple decided it couldn’t ignore it.
Emerging markets
“The iPhone SE will improve traction in emerging markets,” said Bill Kreher, a St Louis-based technology analyst at Edward Jones & Co.
Instead of criticising the company for failing to produce incredible growth figures in a market where they already sell, perhaps more attention should be directed at the new products Apple is bringing to market – or not.
The iPad Pro, while a new product, wasn’t quite the category-breaking device the original iPad proved to be. And the 9.7-inch version of the iPad Pro is a bit of a perplexing one.
The appeal of the iPad Pro was supposed to be not only its higher specs but also the extra screen space it brought – 12.9 inches versus the standard 9.7 inches.
Take that away and you’re relying on the faster chip and better camera, the Pencil compatibility and the new display technology to sell the new Pro to professionals over the iPad Air 2. Apple, meanwhile, is pitching the Pro as a potential replacement for the PC.
Sales figures
The sales figures will be the real test of the product.
In recent years, there has been speculation that Apple was planning a TV set, a smart watch, a serious move into the car industry. The TV has failed to materialise yet, and the autonomous car in general is a long way off being a commercial reality. The Watch is the only product to have made it to market and while it no doubt made a splash, its success is up for debate.
The company has, in a way, been a victim of its own success. People expect big things, but in an environment where technology has already advanced so far in such a short space of time, perhaps we expect too much. A bit of perspective could go a long way.
