Apple accelerates its retail efforts in China

“Apple Inc. is ramping up its retail strategy in China after years of shying from one of the world’s fastest-growing technology markets,” Loretta Chao reports for The Wall Street Journal.

“For years, Chinese consumers have had limited access to Apple’s products, as the company has focused primarily on the developed markets that make up the bulk of its business,” Chao reports. “But Apple’s approach seems to be working, with sales growing apace even as the company on Saturday opened its first full-service Apple store in China, in Beijing. Over the past two years, more Apple resellers have begun popping up in China’s sprawling computer malls. Though the iPhone hasn’t been officially released in China, many eager consumers already have bought the device, hacking it to make it work in China. Apple says it is still working to bring the iPhone to mainland China, the world’s largest cellphone market.”

“Today, Ping Guo (Apple in Chinese) is widely known among China’s affluent, tech-savvy youth in top-tier cities — Apple’s target niche in China,” Chao reports. “Many of China’s existing Mac users pay premium prices to resellers for their computers, iPods and iPhones. And while that target niche is a small piece of the pie — high-end computers make up just 1% to 2% of the overall market, according to Simon Ye, an analyst at Gartner — analysts say the company is well-positioned as a fashionable, aspirational brand. Apple’s Chinese push is proving well timed, with household incomes here increasing.”

“Ron Johnson, Apple’s senior vice president of retail, says the company has plans to open another store in Beijing next year and is also looking to enter Shanghai. Apple’s stores, which are in only seven countries so far, including China and the U.S., generate 20% of the company’s world-wide revenue,” Chao reports.

Full article here.

2 Comments

  1. It is about time. Many people from China I know know the Apple brand (Ping Guo as MDN mentioned). They didn’t understand Apple brand, but once they see the logo, they’d go “Ping Guo! I know, I know this.” As they say, a picture is worth a thousand words… or in this case, a thousand multilingual words.

    Given a high level of brand recognition, one must ask, what took Apple so long to establish itself in a huge market?

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