Apple is not the only smartphone manufacturer dealing with the impact of Covid-19, with a delay to iPhone 12 sales now confirmed. Unlike others, Tim Cook and his team have managed to increase iPhone sales while the market has dropped.
What has saved Apple from the same fate as the competition? The iPhone SE.
iPhone SE (2020)
First of all, the iPhone SE has been very well received by the target market. Not everyone wants a massive phone with screens approaching seven inches, features that push prices into the $900-$100 range, and technology that squeezes the life out of every pixel. For many a pocketable phone that covers the basics of social media, web browsing, email, and instant messaging is enough. That’s where the iPhone SE excels.
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Apple put a lot of emphasis on the use of the A13 Bionic processor, the same A13 that could be found in the iPhone 11 range. This wasn’t a cut down A13, or a processor that was a generation or two back that would presumably be cheaper, it was current. While other specs are trimmed (for example it has a single lens camera, it sports just 3 GB of RAM, and there is no Face ID), Apple brought its smartphone vision to market at $399 without significantly impacting on the user experience.
Apple should be pleased with its current iPhone sales. Although the 1.6 percent increase increase in sales is dwarfed by sales of the Mac (up 21 percent) and the iPad (up 31 percent), the trend of smartphone sales during this quarter has been downwards. Canalys is reporting a 14 percent drop across the board. Canalys also suggests that nearly 1 in 4 of iPhones sold were iPhone SE models:
“Apple defied expectations in Q2. Its new iPhone SE was critical in the quarter, accounting for around 28% of its global volume, while iPhone 11 remained a strong best-seller at nearly 40%. iPhone SE will remain crucial to prop up volume this year, amid delays to Apple’s next flagship release.”
Strip out the iPhone SE numbers and Apple’s sales could well have suffered the same fate as other manufacturers, even if some of those SE sales would have transferred to the more expensive iPhone 11 family.
Finally for now, the iPhone SE has first mover advantage in a crowded market. The SE design may go all the way back to 2014’s iPhone 6, it may not have the looks of the iPhone 11 family, and a larger battery would have been welcome; but the iPhone SE has disrupted the mid-range market.
A look around the launches happening in the third calendar quarter show the majority of manufacturers launching mid-range handsets (such as the OnePlus Nord and the Pixel 4a). Previously there was no new iOS handset to be measured against. Now you have the iPhone SE, and it’s an incredibly capable competitor
The iPhone SE is Apple’s cheapest new iPhone, yet it doesn’t feel hampered by the lower price point. It has sold well and contributed significantly to Apple’s bottom line. And it has set the bar for the Android-powered competition to try and match. It is one of Apple’s quietest success stories of 2020.
The irony of the iPhone SE protecting Apple’s bottom line during the coronavirus pandemic? It was launched virtually during the first lockdown.