Apple's New Strategy to Compete in China's Market is Expected to Turn Red
Apple Industry Chain Shakes
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On the morning of September 12, Apple officially launched three new iPhone models—iPhone 8, iPhone 8 Plus, and the highly anticipated iPhone X. The event triggered a wave of excitement among tech enthusiasts and consumers alike. Many Chinese home appliance retailers also jumped on the bandwagon by offering pre-sales on the same day.
The entire smartphone industry is closely watching these developments. Historically, Apple’s product updates have driven technological advancements that ripple through the supply chain. This time, features like OLED full-screen displays and Face ID technology have been confirmed. However, it remains to be seen whether these changes will significantly reshape the mobile phone supply chain.
In an interview with the 21st Century Business Herald, Wang Hao, President of Frost & Sullivan Greater China, stated that the new iPhones would return to a dual-glass design, eliminate the physical home button, and introduce wireless charging. These upgrades are expected to boost consumer interest. However, he believes that while Apple might see short-term success, it’s unlikely to reverse the long-term trend of Chinese consumers favoring domestic brands.
The iPhone X quickly became a hot topic across social media platforms like Baidu and Weibo, with its facial recognition feature sparking both curiosity and humor online. Despite its high price tag of nearly 10,000 yuan, the model has attracted significant attention. A survey by the 21st Century Business Herald WeChat public account showed that 32% of respondents chose the iPhone X, highlighting the strong demand for installment payment options.
E-commerce giants like Tmall, JD.com, and Suning have all introduced promotional strategies such as installment plans, cashback offers, and trade-in programs to capture market share. Some resellers even raised prices beyond 20,000 yuan due to high demand. The release coincided with Apple’s 10th anniversary, further fueling excitement.
Wang Hao also pointed out that while Apple has made some hardware improvements, competitors like Xiaomi, Samsung, and others have already launched full-screen phones with similar or better features. He noted that Apple still faces challenges in maintaining its dominance in the Chinese market.
With the rise of e-commerce, Apple has expanded its distribution channels significantly. The company now operates official stores on Tmall and has partnered with platforms like Staged Mall, which offer installment options. According to Zhou Tianmu from Staged Mall, Apple products make up over 50% of sales in their platform, reflecting strong consumer demand.
Apple’s strategy in China is evolving. While traditional retail channels remain important, e-commerce has become a key driver. With younger users increasingly turning to online platforms, Apple aims to expand its reach beyond first- and second-tier cities.
Despite its global success, Apple has faced declining sales in China. Its third-quarter 2017 results showed a 25% drop in revenue for the region compared to the previous quarter. In response, Apple has appointed its first Greater China Managing Director and deepened partnerships with local companies like Tencent, Alipay, and WeChat.
While Apple continues to innovate, the Chinese market is becoming more competitive and rational. Consumers are no longer blindly loyal to brand names but are looking for value and performance. As the iPhone X prepares for its late October release, the real test will be how well it performs in the market.
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