Apple iPhone trade-in scheme may launch in time for 5S

Apple have never outwardly paid much attention to the refurbished iPhone market – until now. As Apples growth has slowed, the Cupertino based tech giant has been forced to investigate new market opportunities, especially in light of heightened competition from the likes of Samsung. Samsung are now the Worlds most popular smartphone brand, and the pressure is building at Apple ahead of Septembers iPhone 5S launch.
37.4 million units of the iPhone sold in Q2, which equates to 2.4 million more than the corresponding quarter of 2012. Despite this, Apple shares are down 38 percent on this time last year.

It is now believed the golden years, powered by the launch of the iPhone in 2007 may now be over, especially in light of the loss of the most inspirational creative-entrepreneur of his time, in Steve Jobs.

Current CEO Tim Cook maintains that “game changing” tech us in development, but frankly investors aren’t prepared to take Cook at his word. His reign has yielded evolution rather than revolution thus far, and this focuses attention more on the upcoming launches, including iOS 7. A big launch in September may hault the 18 percent share slide during 2013.

Where one company faulters, another prospers. The gap left by Apple has been filled by Samsung. Powered by Googles Android OS, Samsung now have 75pc of the market (Q1 2013). Apple had 17 percent during the same period.

Smart phone proliferation is now above 50 percent in mature markets like the UK, meaning that trade in programmes are vitally important. Most prospects already have a smartphone, so a trade in programme is an effective way to cycle customers and to keep them paying for the latest tech. The concern for tech companies is that refurbished models could cannibalise sales of new hardware, hence Apple’s reluctance to offer a trade in programme.

This is set to change, and change quickly according to sources.

Apple’s plan is to use traded in iPhones as a cheaper market penetration strategy for emerging markets. Apple will collect iPhone 5’s from markets like the USA and the UK, refurbish them and then sell them strictly in markets like China. These emerging markets have high demand for cheaper, premium technology. This strategy thus fulfils that market need whilst avoiding cannibalising sales of the new iPhone.

Maybe even more importantly for Apple, is the need to prevent the markedly cheaper Android powered smartphones from winning in the emerging markets. Selling used iPhones in emerging markets may thus keep first-time smartphone
buyers around the world from committing to Android.

Apples new trade in programme will be in partnership with BrightStar and will be run out of Apples retail outlets. Customers will receive cash or credit instantly.

Apple have a wealth of new software services planned, including iRadio, all of which rely on people continuing to own iPhones. With that in mind, this is an urgent scheme for Cook and Apple, and some analysts are pegging a trade in scheme launch in time for the iPhone 5S in Q3.