Users in Apple’s ecosystem are “primed” for its new hardware subscription program – Report

In its latest report, Consumer Intelligence Research Partners (CIRP) speculates that Apple’s upcoming hardware subscription program is going to be successful because consumers in the company’s ecosystem are “primed” to adopt it.

Recently, Bloomberg reported that the tech giant is working on a new hardware subscription that will allow users to easily upgrade their devices to the latest models with a monthly fee. However, that monthly fee will not be determined by the cost of a device divided into 12 or 24 months installments but by the type of product and will be tied to their Apple ID.

We explained that the tech giant already offers financial plans for consumers to purchase its products like its iPhone Upgrade Program, trade-in program, interest-free monthly installments for Apple Card users, and monthly installment plans offered by carriers. Based on Apple users’ current purchasing trends, the research firm predicts that they will readily adopt the new hardware subscription program.


Apple’s new hardware subscription program is likely to succeed because of iPhone users’ current purchasing trends

CIRP Partner and Co-Founder, Mike Levin explained that like other subscription services, the iPhone maker has to offer a unique experience with perks that its competitors can’t match to attract users.

“Consumers will compare any subscription program to the existing ala carte offerings. The iPhone Upgrade Program, which launched in 2015, has had limited appeal, as it merely combines existing payment and trade-in options with AppleCare. The most successful subscription services provide new or otherwise unavailable benefits. Amazon Prime delivery is distinct from other delivery options. Costco shopping and Netflix and other streaming video services are only available with a subscription. The challenge for Apple is to create a new subscription service that provides unique value to its customers.”


The report added that it will not be a challenge for the tech giant to gain subscribers for its new hardware subscription service because 50% of its users already use a financial plan to purchase an iPhone.

“Based on current consumer behavior, iPhone users are primed to adopt a subscription service that provides an iPhone bundled with useful apps. Almost half iPhone owners already finance their iPhone purchase, paying monthly for a new phone. And about one-third trade-in their old phone when they buy a new one. So, a significant portion of the user base is accustomed to never owning a phone, instead basically leasing it. Importantly, iPhone users also have grown accustomed to getting a new model every two or at most three years. Apple can easily match these patterns with a program that routinely sends a new phone in exchange for the old one.”

via 9to5Mac

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Addicted to social media and in love with iPhone, started blogging as a hobby. And now it's my passion for every day is a new learning experience. Hopefully, manufacturers will continue to use innovative solutions and we will keep on letting you know about them.