Apple's retail store assault on China linked to weak online sales

Apple’s retail store assault on China linked to weak online sales

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Apple Store
A dramatic mural painted at the Hengzhou Apple Store in China.
Photo: Apple

Apple is opening yet another major brick-and-mortar Apple retail store in China this weekend. But according to a new report, the company’s retail assault on China is linked with a more negative factor: weaker than expected online sales.

The report suggests that Chinese consumers’ use of Apple’s online shopping website has been more disappointing than Apple hoped. Part of the reason for this is that China’s e-commerce platforms have little interest in promoting Apple’s products due to “its weak profitability” for them.

As such, Apple has been aggressively opening Apple Stores in the country to maintain sales.

These stores have opened in quick succession, with an increase from 15 stores in 2014 to a proposed 40 by 2016.

Off the back of them, Apple has experienced massive growth in China. During the company’s last earnings call, Tim Cook revealed that Apple has seen outstanding revenue growth of 112 percent and iPhone unit growth of 87 percent in the Greater China region.

This isn’t the first difference we’ve noted between Apple’s Chinese customers and those in the U.S. Earlier this year, China overtook the U.S. as the number one country for volume of iOS app downloads, although the preference for free apps versus paid ones means it only comes third (after U.S. and Japan) in terms of revenue.

I guess this is why people talk about acting globally, but thinking locally! And, hey, if you want a new Apple Store near your house, persuade everyone in the area to stop buying online.

Source: Digitimes