The price of iPhone 5s in Russia has decreased by approximately one third to become the lowest in the world, writes Russian business daily RBK.
As of January 13, the iPhone 5S for 16 GB costs just $326 in a number of popular retail chains. “The price of $326 is now the lowest in the world,” said Lyudmila Syomushina, a representative of the re: Store, a retailer, which sells Apple products. In Germany a similar model costs $552, while in the UK it costs $562 and in the U.S. — $450.
The initiator of the pre-new year price reduction in Russia was Apple itself, three retailers told RBK. The press service of Apple did not respond to an RBK request. However, in the official Apple Store prices for all iPhone models, including 5s, remained at the same level — 36 990 rubles ($483) for iPhone 5s with 16 GB.
Reducing the selling price of iPhone 5s has provoked a surge in consumer demand. Since the reduction was made late last year, sales at the re: Store have increased significantly: purchases were up 36 percent in December 2015 compared to the same period a year earlier. The electronics chain Eldorado said that demand for 5s phones have grown 30 fold. Maria Zaikina, a representative of the Svyaznoy cellular retailer, said that the sale of iPhone 5s with 16 GB “have increased enormously” relative to the average sales of this model in 2015, and in comparison with the previous year’s Christmas period.
From elite positioning to super discounts
In 2008-2010, the iPhone’s debut in Russia had been a commercial failure. In the absence of operator subsidies, the pricing of the device (starting at $1,000) and its positioning as an elite product did much to explain the poor sales record.
Sales began to take off in 2011. That year, the Russian mobile operator and retailer MTS brought in as many iPhones (for $140.8 million) as it had during all the years dating back to the product’s launch in Russia in 2008. iPhone sales were boosted by the popularity of the iPhone 4 while 3G networks became accessible to large population groups during these years.
The iPhone 5 did even better, with over 15,000 iPhone 5S and 5C sold in Russian retail outlets during the first weekend of sales in October 2013. In summer 2014, the iPhone 5S held first place in the smartphone ratings of Yandex.Market, Russia’s leading online marketplace.
In 2015, however, Apple saw the market share of its smartphone in Russia nearly halve year-on-year by number of units sold, as the collapse of the ruble drove up prices, according to a GfK market report. The iPhone’s market share by units sold fell to 5.2% in April 2015, down from 10.3% one year earlier. Apple’s share in monetary terms fell less drastically: from 26.3% to 21%, the report said.
Following the ruble’s sharp depreciation, Apple had initially raised prices twice, bringing the price of its newest models — the iPhone 6 and iPhone 6 Plus — up 35%. However, the company ultimately lowered the prices of its smartphones by up to 10% in spring 2015. As of June 5 the most basic model of the iPhone 6 cost 45,990 rubles (approximately $820 at the exchange rate of that time).
Russians bought 27 million smartphones in 2014, up 46% from the previous year, IDC reported. Apple doubled its sales to 3.25 million units sold, still lagging behind Samsung (6.05 million) but ahead of Lenovo (2.22 million) and Nokia (1.79 million).
Combined reports from Russia Beyond The Headlines and East-West Digital News.
