The mounting pressure from other brands in China caused Apple to witness declining iPhone shipments in the region, that is, until the company introduced steep discounts to help customers flock back towards its products. According to the latest report, the Cupertino giant saw its price-cutting strategy reward it massively with a 40 percent increase in shipments during May.
iPhone demand started dropping in January and February in China, but Apple started rebounding from March onwards
After being dethroned by Samsung and losing its top spot as the world’s largest smartphone brand for the first quarter of 2024, Apple had to make adjustments to the way it sold iPhones in China. After all, the company was not battling it out with the same group of local competitors because this time, Huawei was slowly inching its way to the top, attempting to regain whatever ground it lost due to the U.S. trade sanctions.
Apple’s strategy was thoroughly simple: market attractive discounts on the new iPhones to encourage customers to pick them as their daily driver. With price cuts of up to $318 introduced on models like the iPhone 15 Pro Max, there was no question that Apple would reap the benefits of this move. According to Bloomberg, there was an uptick in iPhone shipments, with May witnessing a 40 percent bump compared to the same period a year ago.
Foreign brands, of which Apple comprises the vast majority, grew almost four times faster compared to other brands, accounting for just over five million units. Just before this, Apple experienced a 52 percent increase in iPhone shipments for the month of March, showing that slashing the latest iPhones’ prices was working its magic. Based on Counterpoint Research’s statistics, Apple introduced the biggest discounts during the 618 Chinese festival but saw the smallest annual shipment growth of 2.7 percent during this period.
On the other hand, Huawei barely discounted its smartphones but still saw a 42.4 percent shipment surge compared to the same period a year ago. This combination of data reveals that while discounted iPhones have carved a place for themselves in the Chinese market, the threat of Huawei and other brands remains at large. It is likely that Apple will have to make this a routine, or it will continue to lose market share.
News Source: Bloomberg
