The marketing team at Apple has proved to be most successful in the history of business. But even with the upswing in the economy, $1000 for any phone no matter how great, is going to be a hard sell. In November my wife and I bought an amazing 55” 4K TV delivered from Walmart.com for $310. I purchased an HP Laptop for my wife with a beautiful 17” touchscreen and a 7th generation Intel Core I5 and 12GB of RAM for $399. Most consumers have became more value conscious over the multi-year economic slowdown that Obama gave to us. That Apple's marketing team managed to convince consumers to keep purchasing their products in record numbers in such an environment is almost unbelievable.
This can partially be explained because “smart phones” have been the fastest expanding market over the past eight years. Currently nearly everyone, even those in struggling 3rd world countries have a “smart phone”. The vast majority have at least some difficulties using them. Apple's niche has been marketing devices that are less frustrating for consumers to use. This has been a winning strategy for Apple since the beginning.
The iPhone X is a technological marvel, a new step in the evolution of cell phones. It is a premium, high-end smartphone. But even at its price point and the consumer segment that it is aimed at, the real question is not whether it has a the greatest new features and will impress your friends. The real question is... do all the new features make the thing easier to use? So far the reviews have been mixed on this question.
In this segment of tech Google/Android has evolved into a tougher, more diverse and more sophisticated adversary than Microsoft was in the desktop/laptop segment. Apple set the mark and if they blow it on the iPhone X, it will be a major setback. It already appears to some people that the iPhone X is a concession that the lower priced and biggest segment of the cell phone market has already been lost. This is worrisome.
But as Swordmaker wrote the report that has investors spooked may very well be, “way off the mark.” If on the other hand this is a swing and a miss, many investors are concerned about a repeat of May 2015 to May 2016 when Apple stock went from $132.54 to $90.52. Of course from May of 2016 until about a week ago Apple experienced mostly phenomenal gains and this tends to make investors jittery as well. So make no mistake there is big time drama about to unfold. If you haven't got money on the table in this one... just sit back and enjoy the show.
Interestingly enough, while watching television today I saw several commercials from Apple for a two for one deal with the iPhone 8 and no commercials for the iPhone X. To me this seems a little like some sort of acknowledgment from the Apple marketing team that continued expansion in this market is with more affordable, easy to use devices and not the most expensive top of the line products.