Only 11% of people are willing to spend more than $1,000 on Apple’s iPhone 8, which is due to be released as early as next month. That’s the finding in a survey of consumers from investment bank Barclays, CNBC reported.
Mark Moskowitz, a stock analyst at Barclays, found that most people only want to spend $582, or $48.50 a month on a 12-month installment plan, for a new phone. Among people who already own an iPhone, 18% are willing to spend more than $1,000, Barclays said.
Apple may help attract consumers with its upgrade program that lets iPhone owners trade in their current device toward the purchase of a new iPhone every 12 months, CNBC reported.
Apple has a history of charging a premium for its devices, and some reports suggest one version of the next iPhone will be priced from $1,200 to $1,400, making it more expensive than some models of laptops and desktop computers. Expectations are high for the iPhone 8 for some killer features that will impress consumers. The top-end iPhone is expected to include an organic light-emitting diode screen that has a sharper picture and a front-facing 3-D sensor for facial recognition. The next iOS upgrade will have more advanced augmented reality features, peer-to-peer payments in Apple Pay, better maps and an improved version of intelligent assistant Siri.
Sales growth for smartphones is slowing as the space matures, adoption reaches full penetration and consumers hold onto their devices for longer. These trends are putting pressure on device manufacturers to show they can continue to drive revenue growth. Under these circumstances, Apple is likely to be hedge its bets by offering a premium phone alongside offerings for more budget minded consumers. At the same time, the company continues to boost its software offerings, which are a growing portion of its overall revenue.
Installment plans and trade-in programs will help to defray the cost of a premium iPhone for many Apple fans. Meanwhile, people have shown a willingness to spend about $1,000 on an iPhone. The company’s most expensive smartphone now on the market is the iPhone 7 Plus, which costs more than $1,000 after taxes, CNBC reported.
Apple appears very confident in the prospects for its next iPhone. The company this month raised its sales forecast for the current quarter to $49 billion to $52 billion. Analysts estimated sales of only $49.1 billion on the possibility that the iPhone would be delayed, Bloomberg News reported.