In a first, Apple has decided to offer discount on its latest iPhones in less than a month of its launch, with the Cupertino-based company initiating a buyback offer on iPhone 6S and 6S Plus, giving consumers discount of up to Rs 34,000 to boost sales.
This is also the first instance when Apple and its distributors are going to buyback old models under the scheme to ensure that all transactions are genuine and reduce the burden of the retailer who can push sales further, three senior trade partners of Apple in India said.
The iPhone 6S and 6S Plus were launched last month in India at Rs 62,000-Rs 92,000 depending on memory and model, but sales were down 15-20% over last year as iPhone 6 and 6 Plus which hit the market last year were cheaper by Rs 8,500-9,000.
Ingram Micro, one of the Apple’s four iPhone distributors, has just rolled out the buyback scheme in a handful of Apple stores and multi-brand cellphone retail chains in South India which will be subsequently taken national. The other three distributors will also follow suit since the US company wants to achieve its target of trebling sales during the October-December quarter over last year.
“This is the first time a company and its distributors are closely monitoring the buyback at the retail end to track sales, showing how desperate Apple is to increase sales in India since it did not expect such a weak launch for the new iPhones,” a senior executive with one of the leading trade partners said.
“Earlier companies offering buyback used to give indirect subsidy to retailers to compensate and it was the retailer’s headache to sell the old phone, but this time the entire process is driven by Apple,” he said.
The buyback price of Rs 34,000 on the new iPhones is against iPhone 6. The company has informed trade that it will also buyback select hi-end handsets of rival Samsung. Apple has also created a separate website where retailers have to upload details of old handsets against which new models will be bought.
The buyback offer comes at a time when the latest iPhones are getting sold at 7-11% discount since last week in e-commerce marketplaces such as Flipkart, Snapdeal and Amazon.
Snapdeal’s vice president (category management) Rahul Taneja said various promotional offers has led to a great traction for the new iPhones. “We are getting orders for iPhone 6S not only from metros, but also from Tier-II cities,” he said.
Last month, during an analyst conference call, the Apple management had acknowledged that the higher pricing of iPhone 6S and 6S Plus in India and some other markets due to foreign exchange fluctuations has had an impact on their sales.
However, the company’s chief executive officer Tim Cook was positive about India’s potential in the long run. The India price is Rs 14,000-16,000 more than in markets such as the US, Middle East, Singapore and Hong Kong. The poor sales in India are in stark contrast to the global picture where the new phones are disappearing very fast from the shelves.