Apple CEO Tim Cook really wants you to upgrade your old iPhone. To make sure you know it, he’s said it numerous times. During yesterday’s earnings call that discussed the holiday quarter, Cook mentioned upgrades a total of seven times.
Here are all of the instances when Cook mentioned upgrading, including a bonus instance of his CFO pitching in (emphasis mine):
- “As our letter noted, that challenge was compounded by quarterly iPhone upgrades that were lower than we anticipated.”
- “We’ll return to upgrades in a moment, but I first want to say a bit more about our business in Greater China.”
- “Despite iPhone upgrades being lower than we anticipated, our business grew outside of China, including new records in the Americas, Western Europe, Central and Eastern Europe, and the rest of the Asia Pacific segment.”
- “Returning to iPhone, I’d like to talk about our results in the context of those lower-than-expected upgrades. iPhone XR, iPhone XS, and iPhone XS Max are by far the best iPhones we’ve ever shipped.”
- “For millions of customers, we made it inexpensive and efficient to replace the battery and hold onto their existing iPhones a bit longer. Some people have suggested that we shouldn’t have done this because of the potential impact on upgrades, but we strongly believe it was the right thing to do for our customers.”
- Apple’s chief financial officer, Luca Maestri: “And as Tim mentioned, we had a lower number of upgrades than we had anticipated at the beginning of the quarter.”
- Back to Tim: “The upgrade cycle has extended, there’s no doubt about that. As we’ve said several times, I think on this call and before that, the upgrades for the quarter were less than we anticipated due to all the reasons that we had mentioned.”
Cook also went on CNBC in early January to discuss how he planned to make more people upgrade their iPhones. He talked up trade-ins as providing decent value for money: “We haven’t really marketed [the trade-in program] very much. And the truth is, to a consumer, the trade-in looks like a subsidy because it lowers the price of the phone that you want.”
The assumption is, of course, that you want that phone. But too many people, as it turns out, don’t. The iPhones XR, XS, and XS Max have all failed to attract as many new customers as anticipated, with many reviewers saying that there’s little point in upgrading to an XS if you already own an iPhone X from 2017.
That’s why Apple is now running new promotions and even lowering the prices of iPhones in certain underperforming markets in hopes of bolstering sales. This week, Apple launched a new promotion that lets you trade in an old iPhone 6, 7, or 8 (or any iteration of those three models) for a new iPhone XR or XS. You’d be opting into a monthly payment plan of anywhere from $18.99 if you trade in an iPhone 8 for an XR to $35.99 if you trade in an iPhone 6 for an XS. In China, Apple is taking it a step further by allowing users to trade in the iPhone X for the XR or XS, which seems like it might not be a popular deal, given what reviewers have said.
The XR, which once boasted a price of $799, is now being marketed on Apple’s site as $449 with a trade-in and payment plan. Offering such a significant discount could muddy Apple’s brand image of premium luxury, but it seems Cook is willing to make that sacrifice because he really wants you to buy a new iPhone.