Apple Priced Itself Out of Shrinking Chinese Smartphone Market
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Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#2The tone of articles like this is always the same. As if it's a stupid mistake made on the fly. As if Tim Cook was heading out to dinner and someone yelled 'before you leave how much should we charge Tim???' and he shot back with the answer.
Apple made a mistake and priced incorrectly but that was not after consideration, thought and strategy.
A writer for Bloomberg or an analyst for Loup Ventures is in a different league as far as risk and predictions and job rigor. Apple made a mistake but by the same token the same people making the decisions have done pretty well generally and (wait for it) way better than most SV companies, VC or angels who get multiple do-overs in their daily decision making and analysis.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#3This is an interesting development, but not exclusive to the Chinese market. They've priced themselves out of many working Americans who refuse to put payments on a phone.
Many companies, not just Apple, are raising their ASPs, or cutting categories to pursue more affluent customers while tacking on corporate debt to buyback shares in efforts to prop up share prices.
I believe what we're seeing isn't an Apple-ism, this is market behavior. And the market is dictating that Tim Cook and others make these decisions from the top down.
Almost all auto manufacturers in America are dropping a few cars in their lineup in favor of more expensive SUVs, which people are willing to purchase. And there are many other instances of this behavior going on. Don't pay mind to Apple doing this. Instead, focus your time reading on why companies in the CRSPTM1 are all doing similar things regarding consumer purchases.
With the T10Y2Y approaching zero, and eventually negative percentages, I believe we're sitting on a ticking time-bomb that goes off sometime between 2020-2022, but I'm not educated enough to know if this is highly probable or not.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#4You can't blame it on the price of the iPhone for what's happening in China right now.
Also from Bloomberg: Chinese consumer tax receipts down 70% in November. https://www.bloomberg.com/opinion/articles/2018-12-31/china-...
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#5This is an interesting development, but not exclusive to the Chinese market. They've priced themselves out of many working Americans who refuse to put payments on a phone. Many companies, not just Apple, are raising their ASPs, or cutting categories to pursue more affluent customers while tacking on corporate debt to buyback shares in efforts to prop up share prices. I believe what we're seeing isn't an Apple-ism, th…
And that’s in period of high economic growth. Wait until there is a recession (which I read a lot of people expect to start this year) to see how their volumes will react.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#6Is it possible that they deliberately priced themselves in excess of the competition in an attempt to cultivate a more exclusive, high-end image? With so much competition in the Chinese market it has to be hard to distinguish themselves otherwise.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#7I really don't understand why anyone is paying $1000+ for a phone when you can get really amazing phones for $300.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#8That's part of it, but the bigger issue is China is rapidly slowing down. Otherwise Apple would be seeing shrinking sales in other regions, which according to Cook has not been the case.
WSJ today posted this alarming chart of Chinese consumption-tax revenue:
https://i.imgur.com/2LzUKrz.png
https://www.wsj.com/articles/chinas-economic-downturn-takes-...
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#9Is Android the only alternative in China? Can Google monetize the Chinese users at all? Must very frustrating to have 1/4 of the worlds population using your OS behind a firewall.
Re: Apple Priced Itself Out of Shrinking Chinese Smartphone Market
#10I really don't understand why anyone is paying $1000+ for a phone when you can get really amazing phones for $300.
You could apply the same question to pretty much every consumer product on Earth.
The answer is a critical function of marketing.