Moneycontrol
Sep 14, 2017 03:39 PM IST | Source: Moneycontrol.com

DATA STORY: The iPhone's Chinese shipments can make or break Apple

A strong customer loyalty just might save the company's Chinese smartphone market if it can retake its market position from domestic manufacturers.

Although the latest iPhone product launch has caused quite a stir worldwide, Apple’s market position in China could make all the difference to the company’s future revenues.

The data points out that China is expected to sell 424.5 million smartphones in 2017. This is almost a third of the entire smartphone market, where 1.517 billion smartphones are expected to be sold worldwide this year.

Smartphones CHina

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Greater China, which includes Mainland China, Hong Kong, and Taiwan, continues to be the largest hub of smartphone revenues. It is expected to raise USD 148.3 billion from smartphone sales for companies in 2017. The closest contender is the United States, which is expected to raise USD 81.7 billion in smartphone sales in 2017.

Smartphones

Hence, for Apple to keep its phenomenal growth trajectory in place, the most recent being the trillion dollar mark, it must ensure its strong market presence in China.

Infographic: China Is Apple's Only Weak Spot | Statista

Since the beginning of the first quarter in 2016, Apple has consistently lost its foothold in the Chinese smartphone market by showing a drop in revenues. The third quarter of 2017 showing a 9.5 percent drop in sales revenue.

Infographic: Most iPhone Users Never Look Back | Statista

However, Apple’s reputation precedes itself as a premium smartphone maker. A survey shows Apple users command the greatest brand loyalty over any other phone users. Close to 92 percent of iPhone users in the US will buy an upgraded version of an iPhone should they wish to make the switch in the next 12 months.

Infographic: Domestic Players Dominate China's Smartphone Market | Statista

Thus, Apple needs to find out a way to capitalize on the Chinese smartphone market, which grew by 3 percent between April and June 2017. Although the rise was seen due to four major Chinese brands, Apple needs to muscle its way back through Huawei, Oppo, Vivo and Xiaomi to ensure continued growth. According to a report by Reuters, a yardstick poll of the public in China show they are daunted by the steep USD 1,000 price tag of the iPhone X, the most expensive price attached to an iPhone till date.

If Apple manages to negotiate this price point, the rest will be taken care of by itself, provided that Apple continues to deliver on its brand value of premium, innovative smartphones.
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