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Appleof (NASDAQ: AAPL) The iPhone product strategy is usually simple: every year, it introduces new iPhones that will serve as a standard-bearer, and it offers discounts to older models to try to attack the low prices.
Apple has slightly modified the booklet with its latest product introductions. While it excludes the iPhone 8 and the more traditional iPhone 8 Plus, it has eliminated the iPhone X from its lineup. This decision made sense because the iPhone X would simply not fit into the company's current official product stack. (The production of the iPhone X would have been revived, even if Apple does not offer the iPhone X through its own website or its stores.)
Source of the image: Apple.
Today, according to a report by Economic Daily News (via MacRumors), which quotes a report by analysts of Fubon Securities Investment Trust, Apple adds another twist to its mid-range product strategy. Let's take a closer look.
Shades of the iPhone SE
If Apple follows its usual plan, while the company will release its latest iPhones later this year, replacements for the iPhone XS, XS Max and XR should be available for sale. The current iPhone XR – which starts at $ 749 – should see a price cut become the company's main product. Then, at the very bottom of the pile, there should be the iPhone 8 and possibly the Apple iPhone 8 Plus. The iPhone 7 and the iPhone 7 Plus are likely to be abandoned.
It is interesting to note that the aforementioned Economic Daily News report states that in March 2020, Apple will deploy a significantly improved version of the iPhone 8. This phone will apparently come with what will be Apple's best chip, the A13 , and even with a baseline of 128GB of storage. This device should start at $ 649.
In simple terms, this device would be part of Apple's product line when it was launched, what the iPhone SE was when it was launched in March 2016: a device with a former form factor, endowed with of the latest chip technology of the company.
Does it make sense?
To be honest, it's a bit difficult to understand how such a product would fit into Apple's global product stack. If Apple is sticking to its typical gaming book, the range of its iPhone should be the following (once it will launch new devices this fall) (product levels relate to the company's own lines of Apple products):
- Entrance: iPhone 8 and iPhone 8 Plus
- Medium: iPhone XR (at a reduced price)
- Flagship: Successors of the current iPhone XS, iPhone XS Max and iPhone XR
Many consumers would probably find that an iPhone 8 with an A13 chip was a more appealing phone than any entry-level product or mid-range because it would have of the most recent processing power. In addition, priced at $ 649, its price would be consistent with that of the current iPhone XR.
So, if we assume that this report is accurate, Apple could simply consider modifying its current segmentation strategy. Imagine for a moment that after the launch of this year's iPhone product, the stack of products looks like this:
- Entrance: iPhone 8 (iPhone 8 Plus is no longer available)
- Midrange: Successor of the iPhone XR
- Flagship: Successors of the iPhone XS and the iPhone XS Max
In this case, an iPhone 8 with the upgraded A13 chip would serve as a product slightly below the successor of the current iPhone XR, while giving customers the reason they would buy products higher up the stack. .
Take away food
Apple is striving to protect its market share, particularly in markets such as China. I would not be surprised if the company was considering more creative ways to present attractive products than it could sell for much less than what it requires for its flagship devices.
An iPhone 8 with an upgraded A13 chip would be, for the right price, particularly attractive, especially if Apple could get its customers to understand and appreciate what its cutting-edge chip technology brings to the table. It will be interesting to see if this product will eventually be on the market and, if so, it will help give a boost to the global market share of Apple smartphones.
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