Apple iPhone 8 and iPhone 8 Plus have their prices cut in China; analyst calls Apple a "luxury" brand

Yesterday, we passed along a report that cited demand for the Apple iPhone 8 and Apple iPhone 8 Plus in China for Apple's strong showing in the country during the third calendar quarter (Apple's fiscal fourth quarter). During that three month period, Apple shipped 38% more iPhone units in the country than it did last year. However, a fresh report from Reuters that was published today, says that the price of the iPhone 8 has been cut by as much as 20% in China. The lower price is designed to lure buyers who otherwise seem fixated on the Apple iPhone X. The tenth anniversary model launches on Friday.

As we told you on Monday, Apple shipped 11 million handsets in China during the quarter that ended last month. That was up from the 8 million units it shipped the previous year, and was the best quarter the iPhone has had in China over the last two years.

With price cuts ranging from 14% to 20%, consumers in China can now buy the 64GB Apple iPhone 8 for 4,788 yuan. At current exchange rates, that works out to $722.61 USD. The top-of-the-line 256GB Apple iPhone 8 Plus goes for 6,888 yuan, the equivalent of $1,039.54 USD. These prices come from China's leading appliance retailer Suning Commerce Group Co Ltd. It is unusual, to say the least, for a new iPhone model launched less than two months ago to undergo a price cut of this magnitude.

Speaking of pricing, HSBC analyst Erwan Rambourg says that Apple should now be considered a luxury brand. And like all companies in this sector, he points out that "Consumers are buying the spirit of the brand and the way it makes them feel about themselves and in society." The most expensive iPhone ever, the Apple iPhone X, will go on sale this coming Friday after a week of pre-orders. Apple says that it was not prepared for the heavy demand generated by the phone, which it said is "off the charts."

The 64GB model of the iPhone X is priced at $999, while the 256GB version will cost $1,149. It is the first iPhone ever to be equipped with an edge-to-edge OLED panel. The 5.8-inch display is the largest in iPhone history, and the device is powered by the A11 Bionic chipset. In place of Touch ID, the Face ID facial recognition system unlocks the device and also verifies the user's identity for Apple Pay. The battery is said to last two hours longer than the cell used on the Apple iPhone 7, and the Portrait Lighting feature adds dramatic backgrounds to your selfies and portraits.

Rambourg, the HSBC analyst, sees Apple increasing its "retail penetration," noting that only a quarter of its sales come from direct-to-consumer online sales, and retail sales. He sees that figure rising and says that "the brand is just scratching the surface of its retail potential."

source: Reuters, CNBC
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