The Numbers Are In: Apple Loyalty Driving iPhone 4 Sales
It looks as though the iPhone 4 fan base has turned out in droves to upgrade to the iPhone 4. According to Piper Jaffray analyst Gene Munster, better than three-quarters of iPhone 4 sales were upgrades
. While sales are sales nonetheless to Apple, the frequency with which iPhone customers stick with the product and upgrade to a new iPhone model every twelve to twenty-four months bodes well for the future of Apple's smartphone in an increasingly competitive marketplace.
"The bottom line: 77% of new iPhone buyers were existing iPhone owners (upgrades), compared to 56% in 2009 and 38% in 2008," says Munster. "Apple is effectively building a recurring revenue stream from a growing base of iPhone users that upgrade to the newest version every year or two." Especially interesting is that 54% of iPhone 4 buyers spent their hard earned cash on the 32GB model. Last year, only 43% were willing to spring for the high-end model. 28% of new iPhone 4 owners also own an iPad. And 16% of buyers switched carriers to AT&T, down from 28% in 2009.
Many analysts like Munster believe that Apple will sell between 1.0 million to 1.5 million new iPhones during the first three days of its availability (including preorders).
Similar surveys have yielded comparable results suggesting intense customer loyalty to Apple. A freshly released Oppenheimer study, however, shows that Google's Android is rapidly becoming a preferred alternative to the iPhone both to new smartphone buyers or current iPhone owners looking for a change of handsets. In previous surveys, it was always the BlackBerry cited as the most preferable alternative or "second choice."
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