Apple Inc., based in Cupertino, California, has started giving unusual discounts on some iPhone models in China. This shows that the company is having a hard time with falling demand in China, which is the biggest market for smartphones in the world.
The sales will run from January 18th to January 21st, just in time for the Lunar New Year shopping season. Apple is facing slower iPhone sales around the world and more competition from Chinese brands.
Apple is cutting the prices of brand-new iPhones in China by up to 500 yuan ($70) for the first time in years. The company doesn’t usually offer discounts on newly released goods, so this sale is a big change for them. The deals are good for the iPhone 13, the iPhone 13 Pro, and the iPhone 13 Pro Max.
The price cuts suggest that Apple is having trouble selling iPhones in China, which is its third-largest market after the US and Europe.
In 2021, about 15% of all Apple sales came from China. However, Counterpoint Research, Apple registered a quarter-over-quarter growth of 67% due to high demand for the new iPhone 14 series, and Apple’s market share in China reached 22% in Q4 2022.
The deals show that Apple is ready to cut its normally high profit margins in order to get iPhone sales going again before the Lunar New Year shopping season, which is one of China’s biggest spending times.
Apple is getting more and more competition in China’s smartphone market from companies like Oppo, Vivo, Xiaomi, and Huawei. Apple’s share is shrinking as Chinese names take over 80% of smartphone sales in China. As Chinese brands have gotten better, more Chinese people are picking Chinese phones over iPhones.
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The trade war between the US and China has also hurt sales of iPhones. Because they are patriotic, some Chinese people don’t buy American names like Apple. This nationalism preference for Chinese tech brands has made it harder for Apple to sell iPhones in the country.
The iPhone deals in China are the first of their kind for Apple and show how tough the market is for the company. But it’s still not likely that the sales will be enough to bring back sales that have been falling.
For starters, the discounts aren’t that big—around $70 per item. Also, Apple had similar Lunar New Year deals for iPhones in China last year, but they didn’t do very well.
So, it looks like the deals are more of a short-term fix than a long-term plan. In the future, Apple will have to deal with tougher competition and rising nationalism in China if it wants to boost iPhone sales there, which are falling. If Apple doesn’t change its strategy, it’s possible that it will continue to lose market share to homegrown brands.