Why Everyone is Buying iPhones now.

the entire smartphone market has been declining for a few years now the economy has taken a hit companies are selling fewer models they're discounting left right and Center to just try and keep the numbers up all except apple apple is the only big smartphone company whose market share is actually rising and it doesn't really make sense they're always on the expensive end they don't do discounts at all no why on Earth is everyone buying iPhones right now well there's actually nine key factors nine things that apple is either meticulously planned or have just happened to occur that have all aligned to put Apple in the strongest position it's ever been so at the very surface level incomes are rising across the globe every year an average of 50 million more people are moving up into the category of high income and so naturally as you get more disposable money you start to be able to afford more expensive things and that naturally favors Apple who only makes expensive things there's a second subtler effect that I think amplifies this think of any big smartphone company apart from Apple whether it's Samsung or Oppo or xiaomi every single one of these companies has both expensive Flagship phones but also cheap phones you can get a Samsung for 80 you can get an Oppo for about 60 you can get to xiaomi for 50. but Apple doesn't work like that Apple has basically decided that the minimum they're going to charge you to be able to get the iPhone experience is around 400 with their iPhone SE series and this is intentional because what it translates to is that getting an iPhone now means something more than getting a Samsung even though both companies most expensive phones are the same price this inaccessibility creates the feeling of Apple being an aspirational brand that as soon as people do get money for the first time they want to spend on not as much with countries that already have high income like the United States but every time I've been to India which is quite a lot because I have a lot of family there I make a conscious effort to talk to people there about the phone market and I definitely get the feeling that the iPhone almost has a status associated with it and the data supports that in India Indonesia and Vietnam are free of Apple's strongest growth areas and they're all countries that are either developing or newly industrialized okay so incomes are rising apple is well positioned to be able to take advantage of that but this alone might cause a slight shift there's something else that's accelerating this growth and it's called the network effect the network effect is an economics term used to describe a product that actually becomes better the more people use it and apple is one of the very few tech companies who basically Engineers their products around this philosophy think iMessage completely unlimited completely free deeply interactive messaging it works really well but only from iPhone to iPhone or airdrop how many times have you seen someone trying to airdrop someone else's bottle only to see their expression sour as the other person whips out to Samsung from their pocket or apple nodes which allows any iPhone user to contribute to your shared document but if you've got a Google phone you're not invited even FaceTime video calls Apple's basically engineered a really high quality really stable calling solution and then restricted it only to iPhone users but then with FaceTime they've taken it further in a move that seemed very consumer friendly Apple recently allowed Android users to FaceTime for the first time ever this is not charity this is actually a very smart business move because if you're on an Android phone during this FaceTime process they make you feel like a right sucker while you're doing it if you want to FaceTime on Android you have to wait for the iPhone user to initiate the FaceTime and then send you a link that link opens up a page on your browser where you then empty your name and give it permissions to use your mic and your camera and even then you experience the FaceTime in this horrible windowed browser view let's be very clear giving Android users this option is not Apple trying to make things Fair it's Apple same to iPhone users don't worry about switching to Whatsapp video calls your Android buddies will join you on your platform of choice and then for the Android users it's them saying look how good FaceTime works on their iPhone versus your Android you know you want to buy an iPhone these are all just one type of network effect that Apple uses but we really feel the full force of it is via the ecosystem it applies to air tags which update their location every time any Apple device is near them so the more Apple devices in the world the more precise the location finding ability of everyone with an air attack it applies to the new homepod which says anyone so long as they use an iPhone to hand over whatever's playing from their phone to start coming straight out of the speaker and it even applies to their App Store I find this really interesting because even though Android has by far more total users because the vast majority of Apple users are wealthy users who are far more willing to spend they've actually made iPhone the most desirable platform to develop apps for and design accessories for which in turn means that Apple gets better app support and more accessory options which then makes the Iphone even more desirable for consumers and so these incredibly powerful Network effects which have meant that even in a market where the interest and urgency to upgrade in smartphones is falling each one of their ecosystem products in other categories their earphones their speakers their air tags even their financial services now via Apple pay are all seeds to bring more people into the world of Apple in which they're shown very clearly that they won't get the absolute best apple experience until they buy an iPhone which is the center of it I've seen these Network effects happen in my own family when I was younger we stayed well away from iPhones because of the price but as soon as my mum got the first one a few years ago one by one each person has switched over just because of this whole oh well if you switch then we can do X thing together now one of the most powerful pulls from the Android side has always been the excitement Android companies are more experimental they try features that they're not necessarily going to keep next time and there's also always just loads of different Android phones to pick from it's more fun but it also feels like disadvantage is shrinking not through any company's faults but more just the nature of the smartphone market consolidating when smartphones first started it was the Wild West no one knew how they would evolve or how they would end up being used but nowadays at least until the next big thing we've kind of settled into the smartphone era people have developed habits and apps and platforms that they use on a routine basis and in a mature market like that your future purchases become less about whoa that phone folds in half I want that one like it used to be in the future phone era with devices like the Motorola Razer and more about does the next phone I buy allow me to still enjoy all the things that I currently enjoy and this safer less experimental consumer attitude also favors Apple it means that with any given launch Android companies have also had to become safer with less experimentation fewer bold new form factors effectively cutting down on one of the key ways that Android companies use to reach new audiences at those higher price points and without it the best hope to expand your user bases now just comes from the budget to end of markets mostly by just being cheaper than the competition which is not a fun battle for companies to be making but there is another factor that Apple has very carefully planned out that's working together with this see if you'd asked me 10 years ago why I used an Android phone I'd have rattled off an entire list of reasons I'd have been talking for 10 minutes straight about everything that Android does better this has changed if you look back through the years you'll see that the reason Android phones were always the first to get new features that the iPhone didn't have is because Android companies have had to compete with each other they've had to race at every point to cram in as much of the latest tech as possible Android got dual cameras in 2014 Apple didn't introduce them till 2016. Android got wireless charging as early as 2013. Apple didn't bring it in till 2017. Androids have always had millions of customization options whereas for the longest time with an iPhone you'd have one choice what wallpaper do you want the list goes on but the point is that Apple wasn't caught up in this Rush Apple was very aware but they had such a loyal fan base that they didn't need to compete with Android but more just with themselves they realized very early on that there's only so many things you can add to a bar smartphone like this before either the average user just can't tell the difference or the extra cost from those additional features actually makes the phone less desirable like there's only so good you can make the camera before the bigger bottleneck actually becomes the person taking the shots there's only so fast you can make it such that everything you want to do is already buttery smooth there's only so much you can make the screen bigger before the phone is just too big to hold and so you'll maximize your profits by not rushing to get them all in as fast as possible but actually by teasing out those features over a longer period of time making each upgrade significant but never so significant that it robs the next phone of also being able to have one of these killer features which has meant that while Android companies have exhausted all of the most significant upgrades for the Casual user very early on creating the first plus size phones the first multi-camera phones the first wireless charging phones they've struggled to keep that pace up in the last few years but Apple has always made sure that there's enough things left in the tank to keep making the iPhone better at an almost steady rate which did mean that there was a time they fell noticeably behind but that now in 2023 there's really not much missing that an average user would care about they have one by one bit by bit fixed all the major pain points of past iPhones to the point where now the battery is good the cameras are great the screen is great and that if you now own any other Apple products or you even just like the idea of Apple there's no real barrier that would stop you getting one but then also Apple's insistence on releasing features slowly and steadily has helped them for another reason it's allowed them to take their time with features and only release them when they're done in the Apple Way in this very polished very well thought out controlled Manner and this is a big part of why the company has this almost cult-like following people who are fans of Apple's philosophy are happy but when they try an apple feature it's going to work in exactly the way that they expect it to which gives them this mental peace of mind that drives loyalty you've probably heard a lot about the way that Apple controls things the way they want repairs to only be done the Apple Way by certified mechanics the way they wanted iPhones to charge the apple way with the lightning connector and then now that they've been forced to use USBC so people don't need to buy two separate cables they're apparently going to employ a chip that can still differentiate real Apple USBC cables from other USBC cables from the outside this level of control can feel irritating and pretentious and anti-consumer but from the inside it drives loyalty because as a core Apple fan who's willing to buy all of Apple's official accessories and services you are getting treated to an experience that does just tend to work more seamlessly together than any other ecosystem this is why there have been so many surveys over the years which have basically shown that very few people migrate from iPhone to Android and so even though it's slow and steady every time Apple does steal an Android User it tends to be the case that this user stays with them oh and a sub to the channel would be yeah appreciate it not my best so remember how I mentioned that Apple never discounts their phones right they don't throw in a free pair of airpods with your next iPhone purchase like Samsung does surely that's not a good thing in a market where people are trying to save as much as possible well again this is Apple playing the long game so last year I pre-ordered a Samsung Galaxy s22 and it was kind of exciting for me because as a part of the pre-order bonus with it I got a pair of Galaxy buds Pro for free but then a few weeks later I noticed myself even though these earphones are basically 200 at retail just thinking of them as cheaper than they were just because of the way that they were just chucked in there for free it implicitly devalues the product and so you'll notice that actually while Apple does do free gifts sometimes it'll always be Beats headphones Apple owns the Beats brand but they only bought it for the purposes of strengthening their own in-house music products so they don't care about them being devalued but they will make damn sure that you will never get a free pair of airpods or homepods or even a free Apple charger because Apple has made it a priority to protect the value of what it means to own an Apple product and that is now starting to pay off because it means that while Apple products are notoriously expensive it's pricing that you can trust it's pricing that you know isn't about to dip in two weeks time and that once Apple has set this price there's no way around it that is what you pay for it and this has contributed to Apple's products retaining their value over time and therefore also feeling like a more secure investment to make in less certain times but there is one factor that stands above all others Huawei just a few years ago Huawei was the fastest growing smartphone company in the world and they were cramming so much into every new release that they were accelerating that smartphone spec race we talked about to the point where they were obviously a major threat to Samsung but even started stealing some market share from the iPhone so the US China ban which has basically caused the company's implosion has released millions of new users for Apple to suck into their web for one of the most fascinating videos I've ever made about brain chips that's here see you there

Channel: Mrwhosetheboss

Views: 5,700,733

Keywords: iPhone, apple, android, tech, smartphones, iPhone 14, iPhone 15

Id: V4D49YYihQI

Length: 12min 4sec (724 seconds)

Published: Sat Feb 25 2023