Apple has, once again, presented a set of product advancements which are more akin to a refresh than a radical overhaul.
That said, the refresh is a fairly comprehensive one with a number of upgrades and enhancements that should appeal to consumers and help to speed the purchase cycle.
(Refer to Conlumino’s preliminary customer polling on the products below).
The Apple iPhone 7 is not radically different to the previous incarnation and a number of more advanced features, such as iris recognition and edge-to-edge display, have been left to future models. However, the updates provided are solid and there are enough new features and benefits to persuade consumers to upgrade. In particular, the camera, 3D touch, enhanced display, and better battery life will be appealing to consumers.
Other features, such as water and splash resistance, are useful but solve problems that most iPhone owners simply do not have. As such, they are unlikely to be persuasive factors in determining whether consumers upgrade or stick with what they have.
The removal of the headphone jack should not be seen as much of an issue. The adaptor may make connecting traditional headphones fiddlier but for most consumers this will not be a significant barrier to purchase. What is more of an issue is the late release of the Apple AirPods which will not be available until October. This is something of a misstep by Apple as these should have been released alongside the iPhone to encourage cross-purchasing.
The Apple Watch developments are somewhat less compelling. The greater focus on health and fitness benefits is sensible as this plays to a growing area of interest. In particular, the water resistance is a key feature which helps to improve the usability of Apple Watch in a variety of workout situations. The in-built heart rate sensor is another useful addition. Despite this focus, the main barrier to purchase is that, for many, the watch is an unnecessary accessory and one that comes at a price point way in excess of simpler solutions such as Fitbit. There is a sense that the Watch is still trying to find a reason for its existence.
On the issue of price, while the basic, entry model and the Nike+ option are priced at accessible levels, some of the designer collaborations are ludicrously overpriced and unlikely to be attractive to most consumers. They reflect a certain degree of hubris on the part of Apple and the designers involved. The Hermès collection is a case in point, with consumers being asked to pay a premium of just over $1000 over the basic price for a nice looking strap and a redesigned digital face.
The rest of Apple…
More disappointingly, updates on other key lines such as the laptops, desktops, and monitors was lacking. While not as key as the iPhone, these products are important components of Apple’s lineup and are in need of a refresh if demand is to be stimulated.
Overall, this update is much better than Apple’s past few events. However, it still falls some way short of the magical launches Apple used to conduct. As such, while it will stimulate demand it won’t completely remedy the more sluggish sales Apple has faced over the past few quarters.
Conlumino consumer polling
Conlumino pre-recruited a number of existing Apple iPhone users from its consumer panel, chosen to be representative of the iPhone user base in terms of age, gender, and income level. All participants were asked to watch the Apple presentation and then briefly review the new products on Apple’s website. They were then asked to complete a short online survey to give their opinions. Their responses are below. The overall sample size of respondents is 102 and they were from the US only.
Having seen the new iPhone 7 and its features, how likely are you to upgrade to this new phone from your existing device?
Very likely: 12.7
Very unlikely: 23.8
Not sure: 17.2
What features of the iPhone 7 are most appealing to you? (respondents could select more than one option)
Dual camera: 57.9
Longer battery life: 55.1
3D touch: 44.3
New color line-up: 43.9
Better, brighter display: 37.5
Faster processor speed: 29.6
Faster LTE connection: 28.1
Stereo sound: 26.4
Water resistance: 13.2
New headphone connector: 9.8
None of these: 36.2
Apple has removed the traditional headphone jack on the new iPhone, but has provided an adaptor so traditional headphones can still be used. What do you think of this?
I am very against it: 10.6
I am quite against it: 15.9
I a neutral on it: 48.5
I am quite for it: 9.7
I am very for it: 12.2
Not sure: 3.1
Having seen the new Apple Watch, how likely are you to buy one of these devices?
Very likely: 3.3
Very unlikely: 30.1
Not sure: 5.7
- Neil Saunders is CEO of retail analyst Conlumino.