The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.
Ruchi Patel, MBA 2015-17, Vinod Gupta School of Management, IIT Kharagpur
On March 21, 2016 Apple unveiled the iPhone SE; the 4 inch iPhone SE, features an improved camera and hardware and is priced at $399-$499. It is another attempt by Apple to shift from premium segment to mid-market. iPhone 5C was launched in 2013 with the same motive but was later withdrawn from market as it failed to meet customer expectations.
Whenever a new iPhone goes on sale, customers tend to act like it’s a religious holiday. There are the rituals of waiting outside stores in snaking lines and getting high-fived by hordes of excited Apple retail employees after making a purchase.
These customs happened predictably every year since 2007 — that is, until when the iPhone SE launched. Technically, the SE is a new iPhone, but it’s really just the older model iPhone 5S spiffed up with new internal parts to make it run faster and take sharper pictures.
Early morning lines for the iPhone SE could be found in a handful of major cities, ranging from Sydney, Australia to Miami, Florida, but many other Apple Stores had no queues whatsoever as excitement was unsurprisingly more tepid compared to the launch of a flagship smartphone like the iPhone 6s.
The SE has a 4-inch display, the same smaller size as iPhone models from three years ago, and has just about all the same handy features as the bigger and more expensive iPhone 6S, which went on sale last fall.
It can be viewed as today’s technology in yesterday’s body. The phone is meant for people who are not comfortable handling large smart phones but do not want to compromise on technology.
The company aims to capture market in developing economies like India and China by keeping price lower than the regular iPhone. Still the phone is too highly priced for the middle income group in these countries. So, the fate of the phone in these countries is still undecided.
One of the main reasons of failure of iPhone 5C was its confused positioning as a cheap iPhone. For most of the people in developing economy buying an iPhone is a matter of esteem and pride. By positioning iPhone 5C as cheaper version of iPhone this need of the customers was not met. iPhone SE could suffer a similar fate if not positioned correctly in these markets.