Apple: Will iPhone 7 changes be enough or are consumers getting bored?

Apple is hoping wireless technology, better battery life and partnerships with the likes of Nike and Nintendo will be enough to get iPhone sales growing again. But have consumers moved on?

Another September meant business as usual for Apple as it officially unveiled the iPhone 7 last night (7 September).
Another September meant business as usual for Apple as it officially unveiled the iPhone 7 last night (7 September).

So what’s new?

As expected, the new smartphone has abandoned a conventional headphone socket altogether as it promotes the use of its new wireless earphones, Airpods. The move also looks suspiciously like a play to get people to purchase the premium Beats By Dre wireless Bluetooth headphones it now owns.

The new handsets can survive being submerged in water up to depths of 1m (3.2ft) for 30 minutes at a time and have two hours longer battery life than the existing iPhone 6s.

But perhaps the biggest surprise of the evening was the inclusion of Super Mario creator and Nintendo legend Shigeru Minamoto (see above). He announced the new Super Mario Run game will be an iOS exclusive.

Apple also unveiled a new version of the Apple Watch at the event, which it described as the “ultimate fitness device”. Although the original Watch is the best selling smartwatch on the market, shipments of the device plummeted more than 50% year-on-year during the April-to-June quarter of 2016, according to IDC.

However, Apple is hoping the inclusion of the Nike+ app, which allows an owner to monitor their fitness and share details of runs, will get things growing again and provide a compelling alternative to the likes of FitBit.

Buzz from the event appears to be mixed. More than 37,300 people discussed the launch on social media in the UK and 700,000 globally, according to social monitoring agency Meltwater. And 28.7% of that conversation was positive, 16.7% negative and 54.6% neutral.

One of the biggest surprises from the Apple launch was the announcement Super Mario was coming to iOS

A masterclass in repackaging tech

The lack of positive chatter could be down to the lack of big tech breakthroughs in the new iPhone. According to Ilico Elia, head of mobile at DigitasLBi, the event was “another masterclass” in Apple repackaging tech already used by its rivals.

He says: “Like Porsche and its 911, Apple continues to refine its flagship product and to innovate in hardware manufacturing processes as well as in software.”

“Above all else, the event was another Apple masterclass in creating new products that have already been invented.”

Ilico Elia, head of mobile, DigitasLBI

A post-event survey of 100 US consumers conducted by analysts Conlumino seems to back this up. It found that 55.8% were unlikely to buy an iPhone 7, with 30.1% calling it ‘very unlikely’. It also predicted that while the new iPhone might be a compelling upgrade, it isn’t doing enough to attract new customers.

Marketing the iPhone

It’s clear iPhones are not selling like they used to. In fact, from July 2015 to June 2016, shipments of the handset were down 3.6% to 214.4 million, according to IDC.

This compares to a 4.3% rise at bitter rival Samsung, while smaller players such as Huawei (+38.2%) and Oppo (+91.3%) made major gains.

But despite the slowdown, Forrester marketing analyst Thomas Husson is confident in the Apple brand.

iphone-7-a
The different colours on offer for the iPhone 7

He says: “It is true smartphone growth is slowing down in mature markets like North America or Europe and that Apple did not announce a complete redesign of its device. But there are too often irrational expectations that Apple will systematically announce disruptive new products or features.

“Thanks to the new sensors, a better camera experience, more storage and some innovative features, I think the new iPhones will continue to lead the high-end smartphone market and to appeal to consumers.”

On the marketing front, Apple must communicate the iPhone 7’s role in solving everyday problems and start to capitalise on openings in Asia.

“On the service front, there are plenty of opportunities moving forward, all the more as brands are only starting to fully embrace ‘moment marketing’, adding value to the Apple ecosystem. The partnerships with Nike or Nintendo are great examples of this trend,” explains Husson.

“From a marketing standpoint, Apple should continue to talk on how its products solve everyday consumer problems.”

Thomas Husson, analyst, Forrester Research

He adds: “The fact Apple has doubled down on privacy is also a differentiating element. Apple will certainly have to be very relevant at localising its marketing and advertising strategy in key countries like China or India, where the main growth opportunities will come from in the next couple of years.”

And if Apple CEO Tim Cook can make Super Mario Run the next Pokemon Go then that wouldn’t hurt too much either.

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Comments
  • Fishtank Creative 15 Sep 2016 at 10:01 am

    I’d give credence to the rumours about the iPhone 7S or more likely, the 8.

    Apple will be celebrating the 10th anniversary of the iPhone next year and there are already rumours circulating about parts being ordered and prototyped that would bring a completely revolutionary device to the market.

    This is also likely due to how poorly the 7 was protected with every rumour and leak being confirmed and how the this device was just to tide them over until next year to meet production targets.

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