Apple Facing Struggle to Convince Chinese Smartphone Users to Switch Allegiance [Updated]

The Chinese vendors make almost ~ $0 profit.

Source?

It's a widely known fact that Apple keeps extremely high luxury-goods-like profit margins. It's still possible to make money from a "realistically priced" (i.e. sub $1000) smartphone.

I think the iPhone is simply too expensive for that market.

I think the iPhone is simply too expensive for that market.

THIS.

The people who actually build the iPhones in the Chinese factories don't have a salary that would EVERY allow them to buy one of the phones they just assembled. And let's face it: The Chinese Android-based smartphones offer a lot of bang for the buck and come with a decent quality. There's no justification to drop four times the money for something that doesn't actually do anything more or even better.

WeChat sounds like something that could even take off in the US if Apple had someone adept at managing services like that. It will be interesting to see Apple continue to tweak the communication and nascent commerce features on iMessage and see what it turns into. iMessage already is a really important part of the Apple Ecosystem and keeps people connected in the USA.

I don't think that will help them in China, but it's not like the rest of us are chopped liver and our money is worthless, so Apple better not take the rest of us for granted. And if they stop being so greedy and trying to take a cut of things in ways that come across as really petty to people in the Chinese culture, they could become a stronger partner in WeChat commerce, too.

Apple fell asleep at the wheel for the past few years. They let their desktop line atrophy. They let so many of their products coast. And still most of their products are very strong against the competition despite the extra bells and whistles of the competition. It would be amazing to see what they can/will do when they wake the hell up. Get in the giant metal donut and get cracking!

If Apple really wanted to surprise and disrupt the industry, they would make this phone at least $100 cheaper than the newest samesong phones that just came out. unfortunately they just aren't going to have the supply to meet the kind of demand that would create. There's still way too many people that think those phones are so much cheaper than iPhones

Who are these people? No one thinks Samsung's flagships are cheaper than iPhones. As for Apple dropping their price to $100 lower than Samsung? Sweet Jeebus that's funny. Apple isn't chasing market share, they're chasing what they've always chased: profit margin. Besides, trying to compete with Samsung on price sends the wrong message from a company stand point. Might be nice from a customer perspective, but Apple has a different customer perspective: Buy it or don't; somebody else will. It's worked for them so far.

How is that different than the US, Europe, and well, everywhere else?

In the US and Europe iOS and Android mean something. A lot of people prefer one or the other. In China the OS is less important than the app, specifically WeChat. If I am Chinese and spend the majority of my time in WeChat, what does it matter what OS my phone runs? Choosing an iPhone 8 or Galaxy Note 8 doesn't enhance my experience in any way.

Remember when Xiaomi was anointed the "Apple Chinese killer"? Me neither

Never heard that. However, it _is_ often called the "Apple of the East" for its stage loving CEO and innovations.

The Chinese vendors make almost ~ $0 profit. At some point, that will catch up to them. It might take 5-10 years, but it will happen

While Apple and Samsung together do average 90-95% of the total industry profits, that still leaves up to 10% (like four billion a year) for the other ones who are making money, including many smaller firms where even a million dollars is nice to get.

For example, Huawei "only" makes a little over 3/4 billion dollars a year. True, that is only 2% of the total industry profits, but it is definitely not a loss either.

And the amount of money to live well in China is much less than for those living in Cupertino ;)

The theft of our technological IP should be a huge concern yet the discussion consistently gets swept under the rug.

I think the Chinese government is waking up to that themselves, as it even deeply affects their own.

For example, there's a famous case of a Chinese firm making wind turbines for an American company, who bribed an American engineer to give them the critical control software. They then started selling the turbines on their own, leaving the American company out of the profit loop.

So it was hugely karmic that not long after, that same Chinese turbine maker went out of business because OTHER Chinese companies stole both the turbine and its software, and sold them even cheaper.

This is why Apple is pricing itself out of the market due to competition that offers a cheaper alternative that has existing technology or features. They need to get off their high horse and drop the premium BS. iPhone SE is more reasonably priced, IMO, based on my needs.

Yes the iPhone SE is reasonable priced and competitive if it had the features of the 7 and 7 plus today. Apple is pricing itself out of the market. Maybe not in the USA but definitely in Europe and other countries where we get flooded with good build Chinese alternatives.I was wondering why the focus on QR codes, it seems to be a nearly dead tech (from a consumer perspective) here.This is why Apple is pricing itself out of the market due to competition that offers a cheaper alternative that has existing technology or features. They need to get off their high horse and drop the premium BS. iPhone SE is more reasonably priced, IMO, based on my needs.
Source: Apple Facing Struggle to Convince Chinese Smartphone Users to Switch Allegiance [Updated]