Tuesday , October 26 2021

The big problem of Apple that the consumer will end up suffering



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Apple iPhone Xs
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If there is a mark with a large brand awareness market which should Apple, The devices manufactured by Cupertino, California are generally the best-selling all over the world and an aspiration object for many.

This allowed him to position himself as the most valuable brand in the world, currently with a brand value of 200 billion dollars, while that of Google is 155,500 million dollars, first and second place, respectively, of Interbrand 2018's Best Global Brands.

However, just a few weeks of reaching the $ 1 trillion market capitalization value, Apple is not the best time.

It turns out that, despite reporting revenues of more than $ 37.2 billion during the fiscal fourth quarter, the technology is showing clear signs of facing a serious problem and the bad thing is that everything indicates that it is the consumers who end up suffering.

The iPhone is reaching its breaking point

During a decade of existence, iPhone has positioned itself as one of the smartphone best seller – sometimes the best-selling as during the second quarter of 2018. In addition, For the past two years, he is suffering in front of his rivals, particularly against Samsung and Huawei.

Because? During Apple's fourth fiscal quarter, the iPhone was responsible for about 60% of the company's revenue 37 thousand 185 million dollars, of 62 thousand 900 thousand reported.

It shows a spectacular number, the problem is that it sold about 46.9 million handsets between July and September, 0.5 percent more than in the same period, but last year. A behavior that follows the trend of April and June, in which it sold even fewer devices.

To this is added that in his report reduced its sales expectations to the end of the year during the holiday season. That was interpreted as a negative signal by analysts and although the California company reported higher revenues, its market shares plunged about 10 percent on Wall Street.

Indeed, Apple has already lost the trillion dollar mark on the New York Stock Exchange, currently it is located with a market capitalization value of 984.19 billion dollars.

Samsung's Volume and the threat of Huawei

One of the disadvantages of the company led by Tim Cook is that has been pointed out as not being the innovative brand which characterized him for many years and which It lagged behind its main competitors: Samsung and Huawei.

On the one hand, the South Korean company can not sell the amount of Galaxy S9, S9 + and note 9 Do you want, however? These devices were innovative in terms of screen and processor.

In addition, it has in its favor that it sells many mid-range and low-end smartphones, which allows it to maintain the first position of market share global in the third quarter sold 72.2 million devices (20.3% of the market).

The bad news for Samsung and Apple is that Huawei threatens not to stop growing. The Chinese brand is establishing itself in the second place of sales surpassing that of Cupertino with 52 million smartphones between July and September.

Worst of all, analysts emphasize that it sells state-of-the-art appliances – not just mid- and low- the P20, P20 Pro and Mate 10 (replaced by Mate 20 Pro) they report very healthy sales.

The key is that they have stood out as innovative devices; its Leica cameras, display, processor and presence of artificial intelligence, stand out. And the Chinese brand does not miss the opportunity to let its rivals know that it is enjoying.

The problem that the consumer pays

The data show that, at least this year, The dizzying growth of the iPhone is coming to an end and in fact, what still accounts for more than half of Apple's revenue is already becoming a serious problem.

That's because a way to compensate for this does not sell as many devices as its rivals, has been maintaining the strategy of significantly increasing iPhone costs in the final price to the consumer. Since iPhone X the thousand-dollar barrier and with the Xs, Xs max is repeating itself.

In fact, it is a strategy that is replicating in the new iPad Pro and Mac which in fact are two divisions that not only do not grow, but lose vitality; They fell 2% and 6%, respectively, in the last quarter.

So Apple's strategy is to charge more for its products, so analysts anticipate that the following iPhone and iPad models will be even more expensive for the consumer, all to continue to attract the attention of investors to the growing number of sales.

This is reflected in a recent decision communicated by Tim Cook to investors in Apple will leave to report the amount of iPhones, iPad and Mac they sell every quarter.

We do not know if this strategy will work for Apple, at least at the time when the markets did not receive it well, since there is uncertainty about the company. In addition, it is the consumer who ends up paying for having to pay increasingly higher prices. The question is how much will they resist?

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