New Models Attract Mostly Loyal iPhone Owners, Few Android Switchers
Consumer Intelligence Research Partners (CIRP) released analysis of the results from its research on Apple, Inc. (NASDAQ:AAPL) for the fiscal quarter that ended December 31, 2016.
The December 2016 fiscal quarter includes the first full quarter of sales of the new iPhone 7 and 7 Plus models. CIRP finds that the new iPhone 7 and 7 Plus accounted for 72% of total US iPhone sales in the quarter, with iPhone 7 at 40% and iPhone 7 Plus at 32% (Chart 1).
In the first full quarter of availability, the flagship iPhone 7 and 7 Plus models accounted for a slightly higher percentage of iPhone sales than the iPhone 6S and 6S Plus did last year. The entry-level iPhone SE had a smaller share of sales than the similarly positioned 5S did a year ago, and the most expensive iPhone 7 Plus garnered a larger share than the 6S Plus did in the same quarter a year ago. The shift to newer, more expensive phones suggests that Apple could see an uptick in average selling price for iPhones, at least based on US market dynamics.
Among iPhone 7 and 7 Plus buyers, 16% upgraded from iPhone 6S and 6S Plus, and 37% upgraded from iPhone 6 and 6 Plus. In contrast, among iPhone 6S and 6S Plus buyers, 17% upgraded from the iPhone 6 and 6 Plus models, and another 44% upgraded from iPhone 5S/5C or older (Chart 2). 15% of iPhone 7 and 7 Plus buyers upgraded from an Android phone, while 29% of iPhone 6S and 6S Plus buyers came from Android.
The new 7 and 7 Plus models attracted mostly loyal iPhone owners, rather than Android owners. Only 15% of 7 and 7 Plus buyers switched from an Android phone, consistent with the 14% of iPhone 6S and 6S Plus that came from Android in the same quarter last year. This continues the trend of new iPhone models attracting mostly repeat iPhone buyers. The lower-priced, one year-old models, attract a higher percentage of Android switchers, but on a smaller base. Interestingly, the entry-level iPhone SE has a very small Android switcher constituency, but is somewhat effective in attracting first-time smartphone buyers.
CIRP bases its findings on its survey of 500 US Apple customers, surveyed from December 31, 2016-January 12, 2017 that purchased an iPhone, iPad, or Mac in the US in October-December 2016 period. For additional information, please contact CIRP.