Apple iPhone has huge advantage over Android phones as carriers nix subsidies
“Verizon Communication’s decision to nix subsidies for smartphones may benefit Apple Inc. more than rival Android smartphone manufacturers,” Jennifer Booton reports for MarketWatch.
Apple’s iPhones “tend to attract users in higher income brackets, and recent survey data from Morgan Stanley suggests those wealthier customers are more willing to upgrade at the phone’s full, non-subsidized price,” Booton reports. “Morgan Stanley, using data from AlphaWise, estimates that Apple holds a 53% share of the market for consumers with income higher than $100,000.”
“Last year, NPD Group published data that was even more lopsided. It had Apple accounting for 65% of U.S. smartphone sales among consumers who earned more than $100,000. Samsung’s largest income demographic was below $30,000,” Booton reports. “In total, 74% of current Apple users across all income classes surveyed by Morgan Stanley in November and December 2014, shortly after the iPhone 6 launch, said they planned to upgrade within the next two years, compared with just 50% of non-Apple users. This, said Morgan Stanley analyst Katy Huberty, makes Apple far less impacted than the rest of the market should installment plans start to weigh more broadly on upgrade rates…”
MacDailyNews Take: The chickens are coming home to roost.
Apple’s flagship iPhone 6 PlusAndroid is pushed to users who are, in general:
a) confused about why they should be choosing an iPhone over an inferior knockoff and therefore might be less prone to understand/explore their devices’ capabilities or trust their devices with credit card info for shopping; and/or
b) enticed with “Buy One Get One Free,” “Buy One, Get Two or More Free,” or similar offers.
Neither type of customer is the cream of the crop when it comes to successful engagement or coveted demographics; closer to the bottom of the barrel than the top, in fact. Android can be widespread and still demographically inferior precisely because of the way in which and to whom Android devices are marketed. Unending BOGO promos attract a seemingly unending stream of cheapskates just as inane, pointless TV commercials about robots or blasting holes in concrete walls attract meatheads and dullards, not exactly the best demographics unless you’re peddling muscle-building powders or grease monkey overalls.
Google made a crucial mistake: They gave away Android to “partners” who pushed and continue to push the product into the hands of the exact opposite type of user that Google needs for Android to truly thrive. Hence, Android is a backwater of second-rate, or worse, app versions that are only downloaded when free or ad-supported – but the Android user is notoriously cheap, so the ads don’t sell for much because they don’t work very well. You’d have guessed that Google would have understood this, but you’d have guessed wrong.
Google built a platform that depends heavily on advertising support, but sold it to the very type of customer who’s the least likely to patronize ads.
iOS users are the ones who buy apps, so developers focus on iOS users. iOS users buy products, so accessory makers focus on iOS users. iOS users have money and the proven will to spend it, so vehicle makers focus on iOS users. Etcetera. Android can have the “Hee Haw” demographic. Apple doesn’t want it or need it; it’s far more trouble than it’s worth. – MacDailyNews, November 26, 2012
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“All men are created equal.”
Well, not when it comes to users of smartphones and tablets…
The bottom line: Those who settle for Android devices are not equal to iOS users. The fact is that iOS users are worth significantly more than Android settlers to developers, advertisers, third-party accessory makers (speakers, cases, chargers, cables, etc.), vehicle makers, musicians, TV show producers, movie producers, book authors, carriers, retailers, podcasters… The list goes on and on.
The quality of the customer matters. A lot.
Facile “analyses” that look only at market (unit) share, equating one Android settler to one iOS user, make a fatal error by incorrectly equating users of each platform one-to-one.
