In May, the annual inflation rate in the U.S. was 8.6%, the highest level since 1981. Some other major markets for Apple sales are also seeing inflation due to the supply chain disruptions from the various and sundry responses to COVID-19 around the world.
Many firms, especially those with pricing power, can pass increased costs onto their customers by raising prices, particularly if demand is strong…
But Apple may not have to eat those higher costs at all.
Customers tend to have significant disposable income, compared to buyers of Android devices, who tend to choose based on price.
In the “ultra-premium market,” or phones that cost over $1,000, Apple took 66% of unit shipments during the first quarter, according to Counterpoint.
“With global inflation rising, the entry-level and lower price band segments are likely to be harder hit,” Counterpoint researchers wrote.
A Morgan Stanley survey from June said 70% of U.S. consumers were were planning to cut back on spending over the next six months because of inflation. But wealthy households — Apple’s customers — were more positive about their finances and the trajectory of the economy.
“Households with an income of $150K+ are more resilient; the highest uptick in plans to cut back is observed among the mid-tier income cohort,” Morgan Stanley analysts wrote.
MacDailyNews Take: Hee Haw!
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.
When it comes to mobile operating systems, all users are simply not equal. – SteveJack, MacDailyNews, November 15, 2014
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So, snob writers and Apple it seems are only interested in “wealthy customers” and look down their nose at the Hee Haw demographic, eh?
Well, customers of all income levels are paying more and saving less and worse, a story like this inspires no one!
Certainly not a good look for Apple in high inflation times amongst struggling families, seniors of all income levels and average citizens trying to make a living.
We shall revisit the situation in late July when economists project a recession will hit, to see if the elitist wealthy snobs change their tune and find a modicum of concern for the common man…
Damn that capitalism and free market.
Obviously you missed the point…
Buyers do make or not make voluntary buying decisions you know. Who can judge better than the buyers themselves whether to take the plunge—are you suggesting otherwise?
This is an Apple forum; and Apple is expected to make money, right? So I don’t understand your criticism here. If other of life’s staple items have increased in price then anyone can skip a year’s new phone purchase. Or cut in whatever areas suits there personal needs.
Lower income people who are not “wealthy” and cannot afford premium products, should not be so callously mocked and outright dismissed as the unwashed Hee Haw demographic. Simply rubs me the wrong way…
Okay, GoeB; I understand and I withdraw the negative comment.
Correct! With Apple it seems that “but is it good for Apple” is the prevailing attitude.
Wow. I feel so much better about inflation knowing that it won’t effect Apple’s bottom line.
Those who settle for AppleBS’s complete and utter BS are not equal to anyone else. The fact is that AppleBS’s BS is significantly greater than AppleCynic’s ever was is an affront 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. While the quality of BS emanating from AplpeBS and AppleCynic was incredible, this is not a metric to aspire to.
Facile “analyses” that look only at whether it is that “time of the month” for AppleBorkS and AppleCyntnic, make a fatal error by incorrectly equating their single one-to-one brain cells with anything of actual value.
When it comes to common sense and clear thinking, all users are simply not equal.
Plus, it is Apple’s JOB to make money…not to worry about social and economic stratification issues throughout the country.
Classic short term thinking. This is why China is eating your lunch. You plan for the next quarter’s executive payout and China plans for dominance over the next several decades. And they are succeeding while you enable them.