Apple boss Tim Cook is now considering lowering the price of the iPhone in some countries to stem a noticeable drop in sales. Indeed, the apple brand has just announced a drop in its turnover on its star smartphone of around 15% compared to the previous year, while the general turnover of the company is also down 5% to $ 84.3 billion.
Apple is about to lower the price of the iPhone
If Tom Cook has not cited any particular country in which this reduction in tariffs will apply, it is very likely that China and Asian countries are the first concerned, because of a drastic drop in sales, in competition with local firms such as Huawei and Samsung. Another path of reflection, the indexation of sales to local currencies, in order to adapt as closely as possible to the specificities of the markets, Apple hitherto basing itself on the dollar rate and contenting itself with aligning its prices according to the US currency exchange rate. An indexation which also had repercussions on the European market, in particular in the United Kingdom, with the fall of the British Pound following Brexit. “When you take a look at foreign currencies and more particularly those of markets which have experienced difficulties over the past year, the increase in the price of our products was obviously greater there,” said the CEO of Apple. to Reuters, adding “As we enter January and assess the macroeconomic situation in some of these markets, we have decided to revert to prices more suited to local markets, in the hope of increasing sales. in these regions. “
Lower the price of the iPhone to regain market share in certain countries
However, this drop in prices would be more profitable than ever for Apple, given the significant growth in its services sector. Indeed, it can boast of a turnover up 19%, to 10.9 billion, generated by the Apple Music and App Store platforms, all soon to be enhanced with a video streaming service at exclusive content, as well as another dedicated to video games. Note that the brand’s other products are also in good shape, with sales growth of around 9% for the Mac family and up to 33% for accessories and connected products, including Apple Watch 4.
Iphone down, services up
This rather unprecedented price reassessment measure on the part of Apple would therefore ultimately be positive for the future of the brand. However, it remains to be seen the concrete impact of this new strategy by September and the next Keynote, in a smartphone world more competitive than ever. Because Chinese manufacturers like Vivo and Xiaomi are no longer content to run after the iPhone, but are now trying to stand up to it. Major brands are not to be outdone, with the arrival of a range of foldable phones at Samsung this year. The future of Apple therefore promises to be one of battles, for which yet another annual iPhone upgrade may not be enough..
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