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Tag: apple

  • Smartwatch market set for a shakeup: Juniper Research

    Smartwatch market set for a shakeup: Juniper Research

    Big brands are set to lose share in a major shakeup of the smartwatch market. According to Juniper Research, the largest brands in the category now will see their market share fall by 2023 as new niche players gain ground. Four leading brands including Apple, Samsung, Fitbit, and Fossil will see sales decline from an estimated 58 per cent of the market last year to 47 per cent by 2023. The decline is due to the growth of smaller players such as Garmin, Huami and Huawei.

    Smaller players will thrive thanks to strategies tailored for niche markets, their choice of cases or price points, while other brands are releasing premium smartwatches combining the best of fitness, outdoor activity and health features. While Apple will remain the largest single vendor in terms of shipments over the next four years, Huawei will enjoy the fastest growth, at a CAGR of 20 per cent.

    An intensified focus on healthcare integration will also contribute to an increase in smartwatch shipments over the next few years. Juniper forecasts that Apple and Withings will lead this section, followed by Fitbit and Garmin.

    China to become the biggest market

    The rise of smaller players is linked to the rapid expansion of the Chinese market offering lower-priced smartwatches. The Far East and China have now overtaken North America as the largest geographical market, with more than 24 million smartwatches shipped last year, compared to 19.5 million in North America.

    The gap between these two markets will widen by 2023, with the Far East and China trebling its shipments by then.

    Slower hybrid market

    The adoption of hybrid smartwatches will be slower than expected. Last year, hybrid smartwatches represented about 22 per cent of all smartwatch sales. The slower growth is linked to smaller players focusing on digital smartwatches offering more possibilities in terms of apps, connectivity and sensors than hybrid watches, which remain limited in their functionality.

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  • Where will Apple retail chief go after resigning?

    Where will Apple retail chief go after resigning?

    Within hours of the announcement that Apple retail chief Angela Ahrendts was to leave the role in April, speculation was rife as to where she is headed. Ahrendts, who led the fine-tuning of Apple’s retail business for five years after turning around British fashion house Burberry, has a stellar career in the luxury business. Several fashion industry sources have speculated she may be headed to take the helm of Ralph Lauren.

    In a statement announcing the Apple retail chief’s departure, the company said she is leaving the company “for new personal and professional pursuits”. CEO Tim Cook described her departure as “bittersweet”.

    During her time with Apple, Ahrendts – who was once tipped to take over Cook’s role in the future – has subtly redefined the Apple stores from high-end tech shops into community hubs. She took the renowned Apple Store concept created by predecessor Ron Johnson, dropped the “store” from its title and expanded the network to 506 physical stores and another 35 online.

    “Her vision includes stores as gathering spaces and hubs for creativity,” observed Daphne Howard of Retail Dive.

    “While Johnson is credited with initiating the brick-and-mortar strategy that has been the backbone of Apple’s hardware sales, including minimalist spaces conducive to product demos and customer education, Ahrendts has taken that [a step further].”

    Apple’s retail business will now be overseen by Deirdre O’Brien, the company’s senior VP of people, who will add retail to an already long list of responsibilities including talent development, Apple University, recruiting, employee relations, business partnerships, benefits, compensation and inclusion, and diversity.

    Some might see that as a sign Apple is reducing its focus on its retail business, although O’Brien might be considered something of an Apple acolyte, having been with the company for 30 years.

  • Apple again the most valuable US company

    Apple again the most valuable US company

    Apple won back its crown as the most valuable publicly listed US company on Wednesday, ending the session with a market capitalization above recent leaders Microsoft and Amazon.com. Apple edged up 0.03%, putting its market value at $821.5 billion. Microsoft’s market capitalization ended at $813.4 billion after its stock dipped 1.11%, while Amazon’s stock market value finished the day at $805.7 billion, in third place, after its shares slid 1.12%.

    Apple’s stock has risen about 13% since its quarterly earnings report on Jan 29, with investors betting it was oversold following months of concern about a slowdown in iPhone demand and the company’s rare revenue warning on Jan 2 related to soft demand in China.

    But slowing iPhone sales have led to lower expectations for Apple’s stock. The average analyst price target for Apple has fallen from $240 three months ago to $175, less than a dollar more than its current stock price of $174.24.

    After touching a record $1.1 trillion last October, Apple’s market capitalization fell gradually, and it was overtaken in December by Amazon and Microsoft, which have taken turns in the top position since then.

    Apple’s stock market value hit a low of $675 billion on Jan 3 after its revenue warning, but then steadily recovered, helped in part by a quarterly report that was better than feared by investors.

    While Apple has gained in recent sessions, Microsoft and Amazon’s shares fell after their quarterly reports. Amazon has declined almost 5% since Thursday, when it forecast first-quarter sales below Wall Street estimates and said it would step up investments in 2019.

    “That has raised some eyebrows, it’s a perception that Amazon may be settling into a more mature phase in terms of growth,” said Dan Morgan, a senior portfolio manager at Synovus Trust in Atlanta.

    Morgan owns shares in Apple, Amazon and Microsoft, but he said that if forced to choose, he would favor Amazon because of its lead in cloud-computing market share.

    Microsoft’s stock is about flat from last Wednesday, when the software maker met targets for its quarterly results and forecast.

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  • Apple sales and profit slip as demand falls

    Apple sales and profit slip as demand falls

    Tumbling iPhone demand drove an uncharacteristic decline in Apple sales in the first quarter trimming back its profit for the period. Sales of its iPhone range slumped 15 per cent year on year, and although burgeoning revenue from services like digital media subscriptions – up 19 per cent to a new high of US$10.9 billion – and other products compensated, total sales were down 5 per cent to $84.3 billion.

    Sales in China slumped 26.6 per cent during the period.

    Net income fell by $100 million, from $20.065 billion in the December 2017 quarter to $19.965 billion in the latest quarter. While the company championed setting “an all-time earnings per share record” that was a consequence of a share buyback program reducing the share pool rather than an improved bottom line.

    Commenting on the results, GlobalData Retail MD Neil Saunders said while Apple is still a money-making machine, the sales decline “symbolises a company that is starting to run out of steam”.

    “In our view, this is something to be corrected, not least because Apple is a costly company to run and it relies on strong revenue growth to drive up the bottom line. As this quarter’s figures show, failure to achieve that results in profit erosion.”

    Saunders said the slowdown in iPhone sales reflected Apple’s inability to come up with meaningful and valuable innovations that wow consumers.

    “The latest iPhones might be works of art from an engineering perspective, but they are essentially incremental products that lack the excitement and newness of earlier models. With the higher price points of top-end models, consumers expect a lot more for their money. The blunt truth is, Apple’s latest line up of phones doesn’t do that much more than the generations that came before.”

    He said the slowdown in China is a problem Apple shares with many other companies.

    “The country is suffering from more sluggish consumer demand which has put the brakes on retail growth rates across many sectors. However, the issue for Apple is that this has coincided with a rise in competition from local phones and devices which has helped to eat into its own growth. In short, China is no longer the engine of growth for Apple that it once was and this makes Apple uncomfortably more reliant on mature markets to drive revenues. Some of those markets, like Europe, are also not delivering – thanks to very high price points and consumers that are hesitant to spend on big-ticket items.”

    From must have to might buy

    Saunders said Apple’s iPads and some of its Macs are good, quality items, however they are simply not impressing the market and Apple is losing its lustre in terms of producing compelling products.

    “In our view, Apple has moved from a position of ‘must have this and must have it now’ to ‘might buy this at some point in the future’. Price increases may mitigate this but, ultimately, such a shift can only ever result in a softer sales performance.”

    While services are performing well, Saunders said Apple must push much harder.

    “Amazon is successfully creating an ecosystem of services through Prime. Apple needs to do something similar by building on its Apple Music subscription and its App Store offering. Movies and television content are also needed to propel sales.

    “In our view, Apple should seriously consider a big acquisition such as Netflix. Content is a big growth area and is becoming increasingly linked to devices. Apple needs to play more heavily in this space both to generate new opportunities but also to defend its own device business.”

    While Apple remains a solid and financially successful company, he said, a lack of serious and significant innovation means it runs the risk of diluting future earnings.

    “Apple thrives off serving a mass market; at the moment its moves to provide more expensive items to fewer people will ultimately do further harm to the bottom line. The clear blue water that once existed between Apple and its rivals is much diminished. The company has time to reopen the gap, but to do so, it needs to pull something new and unique out of its hat sooner, rather than later.”

    Cook’s positive spin

    Apple CEO Tim Cook delivered a positive spin on the results: “While it was disappointing to miss our revenue guidance, we manage Apple for the long term, and this quarter’s results demonstrate that the underlying strength of our business runs deep and wide. Our active installed base of devices reached an all-time high of 1.4 billion in the first quarter, growing in each of our geographic segments. That’s a great testament to the satisfaction and loyalty of our customers, and it’s driving our services business to new records thanks to our large and fast-growing ecosystem.”

    At the end of the quarter, Apple’s net cash balance was $130 billion.

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  • Apple took unfair profits: Korea FTC

    Apple took unfair profits: Korea FTC

    Korea’s corporate watchdog claimed Apple Korea has bargaining power over local mobile carriers and that it has reaped unfair profits from them in a statement Monday. According to the Fair Trade Commission (FTC), experts called in by the antitrust body said Apple Korea exploited its market position to place part of its advertising costs on local telecommunications companies.

    The statement comes after exchanges between the FTC and the iPhone maker during a deliberation on the company’s position on Jan. 16. It was the second round of hearings since the first deliberation in December.

    Apple Korea has been under investigation by the FTC since 2016 on whether it forced carriers to pay advertising and warranty costs.

    Korea’s fair trade law prohibits abuse of one’s position during a transaction.

    Apple Korea claimed through its expert witnesses, which included economists and business experts, that it does not have leverage over local carriers and defended its actions, saying that its advertisement fund was able to help all parties involved.

    The experts also argued that Apple’s involvement in advertisements was justifiable to maintain the iPhone brand.

    Expert witnesses for the FTC responded that Apple Korea can be regarded as being in a position of power over carriers and that the advertisement fund served to collect additional profit from them. They also stated that the company’s activities in taking part of carrier advertisements cannot be seen as part of their branding strategy.

    The FTC’s Economic Analysis Division provided similar analysis to those made by its witnesses.

    The hearings on the investigation will continue, with the third round of deliberations scheduled for Feb. 20.

    The antitrust body said that the third hearing will discuss specific actions made by Apple. It is unclear whether the third hearing will be the last.

    If found to have abused its position, Apple Korea could face fines worth up to two percent of its related sales.

    The iPhone maker has a history of trouble with the FTC.

    The company made corrective measures under the corporate watchdog for its product replacement policy back in 2011 and its services agreements with local companies in 2016.

  • Johnson & Johnson, Apple collaborate for healthcare

    Johnson & Johnson, Apple collaborate for healthcare

    Apple and Johnson & Johnson are teaming up on a study to determine whether the latest Apple Watch, in conjunction with an app from the pharmaceutical company, can accelerate the diagnosis of a leading cause of stroke. Atrial fibrillation, or AFib, is an irregular and often rapid heart rate that causes about 130,000 deaths and 750,000 hospitalizations each year in the U.S., Johnson & Johnson said. Up to 30 percent of cases go undiagnosed until life-threatening complications occur. Worldwide, about 33 million people have the condition.

    The controlled, randomized multi-year Johnson & Johnson study will start later this year and be limited to U.S. adults ages 65 years and older who wear the Apple Watch Series 4. Specific details on how to participate will be released later.

    The Apple Watch Series 4, which costs $399 or more, has an irregular heart rhythm notification feature, as well as an FDA-cleared ECG app, both of which are designed to detect AFib.

    “We are receiving thank you letters daily from Apple Watch wearers who are discovering they have AFib,” said Apple Chief Operating Officer Jeff Williams. “We want a deeper understanding about outcomes and prevention associated with early detection. We are excited to work with Johnson & Johnson, which has a long history and expertise in cardiovascular disease.”

    Paul Stoffels, Johnson & Johnson’s executive vice president and chief scientific officer, said “the goal is to identify early on AFib and prevent stroke by combining the physical know-how from Apple and what we have from the medical and scientific know-how.”

    Cardiologist Paul Burton, Johnson & Johnson’s vice president of medical affairs for internal medicine, added the watch has a good detection rate for the condition, but there can be false positives.

    If an AFib reading appears, patients are directed to seek a formal diagnosis from their medical provider. Johnson & Johnson’s goal is to collect aggregate data from study participants, rather than tracking individual patients.

    “When we do clinical trials, we always respect the privacy of patients,” Stoffels says.

    Burton believes “the study has the potential to show that there is a lot more atrial fibrillation out there in the real world in older people than we ever imagined, and if you use a tool like an Apple Watch to detect and funnel people to care, you can really drive down stroke risk in those patients.”

    Apple CEO Tim Cook recently talked about Apple’s ambitions in the health space. “I think you’ll be able to look back at some point in the future and Apple’s greatest contribution will have been to people’s health. I think it’s that big.”

    In November 2017, Apple teamed up with the Stanford University School of Medicine on an Apple Heart Study app that uses the heart rate sensor inside the Apple Watch to collect data on irregular heart rhythms. That study is ongoing.

    Apple also hopes iPhone owners will store medical records inside the Health app.

    Stoffels says wearable technology will continue to take on increased importance in the health field, from monitoring whether patients take medications to measuring sleep. “Digital and data will become part of everything we do.”

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  • Samsung cooperates with Apple

    Samsung cooperates with Apple

    Samsung Electronics is teaming with arch-rival Apple to enable its smart TVs to access video, audio and other programming from iTunes. It is the first time the two have cooperated on content. The partnership was announced Monday. Beginning this spring, Samsung smart TVs will have iTunes movies and TV as a default option, along with YouTube and Netflix. For customers with older versions of Samsung smart TVs, the service can be added with a software update.

    Apple’s new movie and TV streaming service is set for official introduction in March. Samsung Smart TVs will be the first non-Apple devices to have access to the service.

    Another feature to be made possible on Samsung TVs is AirPlay 2, a function that allows for wirelessly access to movies, photos, podcasts or music from Apple devices.

    Until recently, before Chinese manufacturers became smartphone leaders, Apple and Samsung competed intensely for domination in the market.

    The two were also embroiled in a seven-year patent battle that was only concluded last year.

    Despite the rivalry, they have continued to do business with each other. Samsung has supplied Apple with smartphone chips and displays.

    At an event held in Las Vegas Monday before the Consumer Electronics Show 2019, the president of the Samsung visual display business, Han Jong-hee said that the collaboration is a “win-win” for both companies while customers will benefit from a wider range of choices.

    “For now, the collaboration will be about content. But in the future, I expect there to be other fields in which we can work together as well,” said Han. According to another senior executive at the event, the project was initially suggested by Samsung.

    The company suggested that it is open to partnerships with other companies as well, saying in a press release that it aims to minimize the barriers between products and providers to offer a “rich selection of content.”

    For Samsung, Apple programming will give it an upper hand in attracting customers.

    The war in the TV market is now as much about what is available on devices as it is about brighter, more colorful and slimmer panels. How TVs seamlessly link to online resources is one of the major battlegrounds.

    The partnership also reflects how Apple is increasingly putting weight on services instead of hardware – the reason it came up with the iTunes video streaming service. Global iPhone sales are falling short of expectations as customers don’t change phones as frequently as before and many are being turned off by the high prices.

    Samsung brings with it the strength of being No. 1 in the global TV market, with more than a 40 percent share.

    “We look forward to bringing the iTunes and AirPlay 2 experience to even more customers around the world through Samsung smart TVs, so iPhone, iPad and Mac users have yet another way to enjoy all their favorite content on the biggest screen in their home,” said Eddy Cue, senior vice president of Internet Software and Services at Apple.

  • Coupang to become an authorized Apple retailer

    Coupang to become an authorized Apple retailer

    Coupang, Korea’s top e-commerce platform, has been selected as an authorized retailer to sell Apple products, the company announced Friday. It said that the e-commerce giant was selected to become an authorized reseller of Apple products, and the service will begin sometime this month. The products that will be offered include iPad Pros, MacBooks and Apple Watches, as well as related accessories.

    Coupang said that its shoppers can get access to Apple products that carry a full Apple warranty and come with after-sales customer services from Apple.

    “Coupang will be an attractive purchase channel for customers who love or want to experience Apple products,” said Navid Veiseh, Coupang’s senior vice president of global e-commerce. “We will continue to expand the range of premium electronics brands like Apple, which, when combined with our Rocket delivery and RocketPay services, make Coupang the first place for customers to turn when shopping for premium electronics.”

    Coupang is known for its fast Rocket delivery service that sends items purchased the following day.

  • Apple sales plummet in Greater China

    Apple sales plummet in Greater China

    Plummeting Apple sales in China have prompted the company to warn shareholders of a US$5 billion hole in its first-quarter revenue forecast. “While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China,” Apple CEO Tim Cook wrote in a letter to investors.

    “In fact, most of our revenue shortfall to our guidance, and over 100 per cent of our year-over-year worldwide revenue decline, occurred in Greater China across iPhone, Mac and iPad,” he said.

    The Apple sales decline in China, Hong Kong and Taiwan would most likely exceed $4.3 billion, roughly equal to the company’s overall drop in revenue.

    Previously, Apple had forecast revenue of between $89 billion and $93 billion. Now it expects the figure will be closer to $84 billion, but notes final figures will not be calculated for several weeks.

    Cook said the rising tension between the US and China played a part in the declining sales, with traffic to Apple stores in the region declining as the quarter progressed. This, in turn, led to lower than expected iPhone revenue in the region, which was compounded by the stalling iPhone upgrades seen in other markets.

    “We believe there are other factors broadly impacting our iPhone performance, including consumers adapting to a world with fewer carrier subsidies, US dollar strength-related price increases, and some consumers taking advantage of significantly reduced pricing for iPhone battery replacements,” Cook explained.

    In response to these trends, the business is seeking to make it easier to trade in used iPhones at Apple stores, as well as allow payments to be made over a longer period.

    “This is not only great for the environment, it is great for the customer, as their existing phone acts as a subsidy for their new phone,” Cook said.

    Despite the slowing traffic, Apple’s other categories grew over the period, with the company’s wearables category growing by almost 50 per cent due to the popularity of Apple Watch and AirPods.

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  • Korean iPhone owners claim low trade-in prices

    Korean iPhone owners claim low trade-in prices

    iPhone users are accusing Apple of paying Korean customers less for their trade-ins than the devices are worth, while noting differences between promotions in other countries and those in Korea.  If an iPhone owner wants to return an older model when buying a new device, iPhone Korea said it will offer up to a 300,000-won ($268.56) discount on the latest smartphones, the iPhone XS and iPhone XR. Korean customers are outraged.

    They claim that the deal has been made available to them a full month later than in other countries. In the United States, Japan and China, trade-in opportunities started in late November. The amount in compensation is also said to be too low.

    Apple Korea announced on Dec. 24 that it is taking iPhone trade-ins at its retail store in Garosugil, Seoul, and will continue to do so until late January next year.

    If the user returns an older model, it is possible for them to buy the 990,000 won iPhone XR for 690,000 won and the 1.37 million won iPhone XS for 1.07 million won.

    Internet community Clien exploded with comments on Dec. 25, the day after the announcement. “I might as well sell it at the Gangbyeon Electronics Mart rather than returning it to Apple,” said one. Another added: “It is disrespecting the customers.”

    While iPhone Korea only compensates up to 300,000 won for an iPhone 7+ released two years ago, the price for an iPhone 7+ in the second-hand market near Gangbyeon and Sindorim is around 380,000 won, according to mobile community Cetizen.

    If the product is an S class with almost no cracks, the price goes up to 450,000 won.

    After typing in the serial number for a black iPhone 7 with 128 gigabytes into the trade-in page on Apple Korea’s website, a reporter received a quote of 174,000 won. In the second-hand market, users can sell the phone for at least at 289,000 won. Apple is offering 115,000 won less for the device.

    Lee Doo-hee, a programmer who enjoys using Apple products said, “I can get more money if I sell directly, so I do not feel any need to go to the Apple store in person and exchange my iPhone.”

    Apple U.S. announced that it is offering trade-ins of about $300 for those buying an iPhone XR and iPhone XS. This is about 10 percent more than in the Korean market.

    NTT Docomo, Japan’s No. 1 mobile company, is offering the iPhone XR for 25,920 yen ($235.05), around 260,000 won, for those signing a two-year contract. No similar discounts are offered in Korea.

    “For Apple, Korea is the home turf for Samsung Electronics, Apple’s old enemy,” according to a source in the sector.

    “Apple only has to get a fair amount of earnings from hard-core iPhone fans, which possibly account for 15 percent of all mobile communications users in Korea. That is why it is pursuing unfavorable policies, like excluding certain countries from promotions.”

    It is believed that the current promotion from Apple Korea is due to the slump in sales of recent iPhones. High prices are seen as the main cause of the recent slowing of sales growth.

    Kuo Ming-chi, a Taiwanese Apple expert as well as an analyst at TF International Securities, has revised his first-quarter 2019 sales volume estimate for iPhones from a 47 million to 52 million range to a 38 million to 42 million range.

    A report written by Kuo was titled: “Shipments of iPhones in 2019 could be below 190 million.”

    The market value of Apple exceeded one trillion dollars in September last year. It is now around $700 billion.

  • Apple assembler Foxconn considering iPhone factory in Vietnam

    Apple assembler Foxconn considering iPhone factory in Vietnam

    Apple’s biggest iPhone assembler Foxconn is considering setting up a factory in Vietnam to mitigate any impact of the ongoing trade war. The report from Vietnamese state media comes after several executives interviewed last week singled out Vietnam and neighboring Thailand as preferred destinations should they need to shelter operations from the trade war, braving hurdles such a lack of skilled labor and inadequate infrastructure.

    Foxconn Group and the Hanoi People’s Committee are working together to open an iPhone manufacturing facility in Vietnam to negate the impacts of the U.S.-China trade war.

    Vu Tien Loc, head of the Vietnam Chamber of Commerce and Industry, raised the matter with Prime Minister Nguyen Xuan Phuc at a meeting on Nov. 22.

    “We are discussing the possibility of this with Foxconn,” Loc said, without elaborating. Hanoi People’s Committee Chairman Nguyen Duc Chung declined to comment.

    Taiwan’s Foxconn, formally Hon Hai Precision Industry Co Ltd said it “follows a strict company policy of not commenting on any matters related to current or potential customers, or any of their products”.

    In trade talks on Saturday, U.S. President Donald Trump and Chinese President Xi Jinping agreed not to introduce any tariffs for 90 days as negotiations continue.

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  • Amazon briefly edges out Apple to top Nasdaq

    Amazon briefly edges out Apple to top Nasdaq

    Amazon briefly became the most valuable company on Wall Street in intraday trade on Monday, days after Microsoft dethroned long-time leader Apple. Amazon rose by 4.7 percent at one point, putting its market capitalization at $865.0 billion. At the same time, Apple traded up 2.1 percent, giving it a market capitalization of $864.8 billion.

    Microsoft, which on Friday closed above Apple’s market capitalization for the first time in eight years, was up 0.9 percent, leaving its stock market value at $859.0 billion, third in the group.

    Amazon’s lead lasted only a few seconds. At the close, Apple was back on top with a 3.49 percent increase in its stock that put its total value at $877 billion. It was followed by Amazon, up 4.86 percent with a market capitalization of $866.6 billion, and then Microsoft, up 1.08 percent and a stock market value of $860.4 billion.

    The tight race between the trio of high-powered technology stocks coincided with a broad stock market rally after the United States and China agreed on a temporary truce in their ongoing trade dispute.

    Apple in August became the first U.S. publicly listed company to reach a $1 trillion market capitalization, but its share price has fallen sharply in recent months as investors worried that demand for iPhones was losing steam.

    Its market capitalization overtook Microsoft’s in 2010 as Microsoft struggled with slow demand for personal computers, due in part to the explosion of smartphones like the iPhone.

    Amazon’s stock has recovered most of the ground it lost after the online retailer in October forecast disappointing sales for the holiday quarter.

  • Kering’s new digital strategy revealed

    Kering’s new digital strategy revealed

    Customers draw inspiration from today’s hyperconnected world and they engage with luxury brands through the digital tools they use every day. In a fast-changing environment, the success of luxury houses depends upon their ability to offer creative propositions, and a consistent customer experience across all distribution channels and devices.

    In December 2017, Kering appointed Grégory Boutté as Chief Client and Digital Officer with the mission to carry out Kering’s digital transformation and to take the lead on e-commerce, CRM, data science and innovation for the Group. Since then, e-commerce has been the fastest growing channel for all Kering’s brands and represents 6% of the Group’s total retail sales for the first half of 2018.

    “Digital can be many different things at once – a distribution channel; a platform for offering seamless omni-channel services to clients; a driver of brand image and visibility; and a tool for engaging with customers in a personalized way. Digital technology, data science and innovation provide a way of offering our customers the best possible experience – on every touchpoint”, declared Grégory Boutté.

    Drawing upon his vision, Kering’s digital approach is based on the following objectives:

    • to provide the Group and its Houses with a real-time 360-degree view of their customers, and to deliver rich and personalized experiences;
    • to offer clients high levels of service, from initial transaction to after-sales;
    • to enable Kering’s Houses to develop close relationships with their clients and to adapt their offerings in order to meet specific needs.

    Today, Kering is announcing new milestones on its digital journey.

    The following initiatives will strengthen Kering’s focus on enhancing the Group’s omni-channel capabilities and further developing its Houses’ digital activities.

    In-store customer experience

    Kering is working on a suite of apps in partnership with Apple to be used by Houses staff in store, the first of which is a store experience app that enables sales associates in-store to access stock levels in real time to provide their customers with a fully personalized service.

    Via the app, sales associates know instantly if a specific size or color is available in-store or if it can be ordered from other stores; they can also give customized styling recommendations.

    Client service

    Kering developed a new approach to customer service with centralized teams in Europe and the US focused on addressing customers’ requests.

    Gucci, Saint Laurent and Bottega Veneta have dedicated teams, while other brands grouped their efforts under a single customer service unit, operated by Kering on their behalf.

    CRM and Communication

    Kering has launched several pilot projects using data science techniques to deliver personalized messages and experiences to customers, based on their profile and purchasing history.

    All Kering Houses have launched or are launching WeChat mini-programs in order to build as close a relationship as possible with their Chinese customers and to offer social commerce.

    E-commerce 

    Kering will leverage its in-house technology and operations team to fully internalize the e-commerce activities currently handled through the joint venture with YNAP.

    Following a highly successful and fruitful seven-year partnership with YNAP, these e-commerce activities will transition to Kering in the first half of 2020.

    Coordinated efforts and shared expertise with YNAP have enabled Kering Houses to enhance the level of service of their e-commerce websites. Most of them now offer services such as check availability, reserve in store, make store appointment, pick-up in store, return in store, exchange in store, and buy online in store.

    Kering will continue to develop partnerships with third-party e-commerce platforms when relevant.

    Digital capabilities

    A data science team has been created at Group level to improve the service provided to the clients of Kering’s Houses by making the best use of the available data.

    A China-based Client & Digital team is currently being formed. It will be responsible for adapting digital practices to the Chinese market, along with identifying and promoting innovations from China to other markets.

    Kering’s Group Innovation team has been tasked with two missions: to instill an internal culture of innovation (test-and-learn approach, quick sharing of discoveries, scouting business trends), and to work on disruptive technologies to further improve the client experience in the future in terms of business or environmental matters.

    Kering’s Chief Client & Digital Officer Grégory Boutté added: “These exciting new initiatives have been designed to meet – and exceed – the needs of our Houses’ customers and to ensure we continue to offer them an exceptional experience across all channels in a fast-changing global market. These opportunities have been made possible by the experience and know-how that Kering has gained over the years, notably through its successful joint venture with YNAP. We will continue to work with them post-transition and to enjoy a fruitful relationship.”

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  • Apple pilloried over display model policy

    Apple pilloried over display model policy

    Just before the Fair Trade Commission comes to a decision on whether Apple has violated domestic fair trade laws, Korean phone distributors are calling the tech giant out for being the only phone manufacturer in the country that makes them pay for display phones in their stores.

    The Fair Trade Commission (FTC) is due to hold a meeting in mid-December after two years of investigating accusations against Apple and finally decide whether the company indulged in unfair practices. Some complaints are that Apple charges mobile carriers for repair and advertising costs of Apple products.

    On Wednesday, the Korea Mobile Distributors Association (KMDA) accused the company of doing something that no other handset maker did in Korea. “Apple doesn’t let us sell iPhones at all if we don’t purchase the demo phones needed for store displays,” read a statement from the KMDA. “Other manufacturers provide the display phones themselves, and come to collect them later.”

    According to the association, Apple even charged retailers for the costs of building shelves for display models and controlled where the promotional posters for new products were placed. Most of the demo devices are priced at around 70 percent of the market price. Distributors say they also had to purchase demo iPads and Apple Watches.

    iPhones are getting more costly, which could be a factor in the distributors going public with complaints against the company.

    In the past, Apple phones cost no more than 1 million won ($883). Last November, the iPhone X launched just three weeks after the iPhone 8 with a 1.42 million won price tag for a 64 gigabyte model. With the release of the iPhone XS, XS Max and XR on Nov. 2, iPhone prices have reached new highs. The iPhone XS Max is selling for more than 30 percent higher than the iPhone X at 1.97 million won for a 512 gigabyte model.

    “Previously, I spent around 1.1 million won on demo devices for Apple’s new products,” said a 53-year-old owner of a wireless store in Jongno District, central Seoul.

    Branches of the three major mobile carriers – SKT, LG U+ and KT – are the main distributors of mobile phones in Korea.

    “But recently, with Apple products becoming more expensive, the costs I have to bear have risen tremendously,” he said.

    The owner estimated that he spent nearly 5 million won on purchasing demo phones for Apple’s newest models.

    According to industry estimates, each mobile retailer spends around 2.9 million won a year purchasing Apple demo phones. This means that Apple will earn around 25.5 billion won in total sales of demo phones from the country’s 8,800 wireless stores.

    “We are not trying to sue Apple right away at this point, but rather figure out who holds responsibility,” added a KMDA spokesman. “Mobile carriers may be responsible for allowing Apple to pursue such unfair practices, leaving distributors to pay for the costs.”

    Korea is not the only country that has investigated Apple for unfair practices. This July, Japanese authorities called out the tech giant for antimonopoly practices that included forcing local mobile carriers to subsidize iPhone prices to boost sales. In 2016, France sued Apple for $55 million over unfair practices that also involved unfair contracts.

    Apple has not released an official response to the KMDA’s complaints.

    Sales of Apple’s new products have been less than stellar, which is also fueling dissatisfaction among distributors. According to industry estimates, the number of customers buying Apple’s three newest models between Nov. 2 and Nov. 7 was only 60 percent of the number that purchased Apple’s iPhone X and iPhone 8 in their first week last November.

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  • Retailers attack ‘unfair’ Apple South Korea practices

    Retailers attack ‘unfair’ Apple South Korea practices

    Apple South Korea is under fire from retailers, accused of using unfair commercial practices. South Korean retailers have joined forces to confront Apple’s continuous “gapjil” — a uniquely Korean term referring to the abuse of power by someone against a person in a weaker position — that has put an increasing financial burden on their operations.

    The Korea Mobile Distribution Association has claimed in a statement that Apple South Korea had habitually forced local dealers to buy the iPhone maker’s new models for demonstration or demo phones, as opposed to other brands’ practices, putting an increasing financial burden on them, and that “they cannot stand it anymore”.

    The retailers say they had no choice but to accept Apple’s overbearing demands, since the popular iPhone’s position in the market makes it difficult to ignore, to say the least.

    It is reported that the retailers had to buy Apple’s new models including the iPhone XS, iPhone XS Max and iPhone XR, but having to buy too many new models in a short period of time and the “exorbitant prices” of the new phones resulted in a significant financial burden.

    According to the KMDA, most mobile phone manufacturers offer their new models for demonstration for free, and collect them when newer models are released. Apple, however, has imposed additional conditions regarding the brand’s new model promotion: forcing retailers to pay for the manufacturing cost of phone stands, and determining where the stands and promotional posters will be placed in stores, according to local retailers.

    Domestic mobile carriers are no exception to Apple’s overbearing position. Industry watchers say local carriers had to shoulder advertising expenses aimed to promote Apple’s new lineup. Even the costs of subsidy plans and repair fees for Apple’s phones tend to be covered by mobile carriers.

    The Fair Trade Commission ruled that Apple South Korea’s sales practices were in violation of local competition laws, and sent a review report to the iPhone maker that indicates the corresponding fines and required measures to address the company’s anticompetitive behavior. Apple has yet to respond.

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