The market for smartphones in urban China is nearly saturated, with ownership in some middle-class populations registering as high as 106%. But Apple’s prospects for growth still look good, according a report to clients issued Tuesday by CSLA’s Avi Silver.
Not only are 60% of Chinese iPhone owners due for an upgrade, but large numbers of disaffected Android owners are poised to switch.
The results come from a proprietary survey of 854 middle-class mobile phone owners in urban China, including 594 in 20 tier 1-2 cities and 260 in tier 3-5 cities. Average age: 35. Average disposable income: 12,000 Yuan (about $2,000) a year.
Among the findings:
- 36% of the total surveyed group own an iPhone, 38% in tier 1-2 cities, 31% in tier 3-5 cities.
- Among iPhone owners, 42% own an iPhone 6 or iPhone 6 Plus.
- 53% of surveyed iPhone owners had previously switched from Android.
- Only 4% of surveyed Android users are iPhone switchers.
- 32% of Android users buying a new phone in the next 12 months will switch to iPhone.
- 87% of iPhone users buying a new phone in the next 12 months will stay with iPhone.
- In all, 54% of buyers in the next 12 months will choose iPhone, implying significant market-share gains compared with the current 36% iPhone installed base.
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These numbers suggest to Silver that Apple should easily beat last year’s record quarterly iPhone sales.
The same survey found relatively strong interest in the Apple Watch. Although only 2% of Chinese iPhone owners said they will definitely buy the Watch in the next 12 months, 22% will probably buy it. (21% will definitely not buy it while 26% will probably not buy.)
Two percent would not be good; 22% would be extraordinary.
Follow Philip Elmer-DeWitt on Twitter at @philiped. Read his Apple (AAPL) coverage at fortune.com/ped or subscribe via his RSS feed.