Apple's January price hikes dented sales, but the increase in revenue per sale more than made up for it, according to Dixons Carphone CEO Seb James and group finance director Humphrey Singer.
Discussing the impacts of Brexit in regards to price elasticity, Seb James stated, 'Apple customers are the exception to the rule, because Apple customers tend to be quite affluent and they don’t want anything else. They have experienced price increases and interestingly, we have seen some decrease in volume as a result, but it’s offset by the price increase.’
In January Apple increased their prices across their app store by 25% with earlier reports that the company had increased the price of their flagship model by up to £100 as a result of the devaluation of Sterling. However, as Humphrey Singer explained, the increases were disproportionate to the impact of Brexit. Singer stated, ‘The Apple price increases were enormously more than the exchange rate change had been, so really that muddied the waters - it may have been an interesting headline, but it wasn’t reflective of the effects of currency fluctuation.’
The comments come against a background of falling sales of global iPhones, with 45.51 million sold in the three months to September 2016, while annual Apple revenue fell for the first time since 2001, highlighting a slowdown in the smartphone market as well as intensifying competition, particularly from Chinese rivals.
Despite this, Apple's chief Executive Tim Cook claimed that he was happy with the response of customers to the iPhone 7, and that world demand, including in China, was outstripping supply. This supply outstrip came to a head last September, where many UK stores ran out of iPhone 7 devices. Commenting on this, Seb James outlined how Carphone Warehouse responded, ‘We diverted every iPhone we had to where we could sell it at its best. Other than that and complaining constantly to manufacturers, there’s not a lot more we could do. We think we get our fair share, our business over-indexes in that area of the market.’