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'The demographic dividend of the last 40 years is ending': J.P. Morgan says the world is running out of the two things that kept interest rates down

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TechThe Mobile Executive

Apple’s iPhone 7 Isn’t Attracting Many Android Users

By
Don Reisinger
Don Reisinger
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By
Don Reisinger
Don Reisinger
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November 17, 2016, 11:35 AM ET
Tim Cook
Apple CEO Tim Cook shows an iPhone 7 to performer Maddie Ziegler during an event to announce new products, Wednesday, Sept. 7, 2016, in San Francisco. (AP Photo/Marcio Jose Sanchez)Marcio Jose Sanchez — AP
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Far more Android users picked the iPhone 6s than the iPhone 7, according to new data from Consumer Intelligence Research Partners (CIRP).

Out of all the people who have bought an iPhone 7 since its release in September, 17% say that they were previously Android users, according to CIRP. That’s up by five percentage points compared to the 2014 release of the iPhone 6, but down from 26% of iPhone 6s owners who were previously Android users.

Overall, Apple (AAPL) is still attracting most of iPhone owners from its existing base of customers. And at least so far, Android users are still proving loyal to their mobile operating system.

But as CIRP partner and co-founder Mike Levin notes, that’s not necessarily a bad thing for Apple. After all, Android adoption is higher with iPhone 7 than it was with the company’s last big release, the iPhone 6. What’s more, he says, Android users are bolstering Apple sales in years, like 2015, when it releases modest upgrades and not as many iPhone owners are looking to update.

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“The two more successful iPhone launches in the last three years were driven by existing loyal iPhone owners who upgrade to a new iPhone model, and rely less on Android owners who switch to an iPhone,” Levin says. “When Apple launched the less compelling iPhone 6S and 6S Plus models in 2015, existing iPhone owners essentially sat out the upgrade cycle.”

Apple released its iPhone 7 in September. The smartphone comes with a similar design to its predecessor, the iPhone 6s, but offers a faster processor and improved camera. It’s also the first iPhone not to ship with a headphone jack. While Apple has not broken out iPhone 7 sales, analysts and market researchers say the smartphone is selling well.

CIRP didn’t share its estimate on iPhone 7 sales figures, but did say that the smartphone accounted for approximately three-quarters of all iPhone purchases in the 30 days within its release. That’s up from 71% of purchases for the iPhone 6s during its own launch window in 2015. The iPhone 6 accounted for 81% of purchases in the 30 days around its own release.

For more about Apple’s iPhone 7, watch:

Still, for Apple, that might not be a problem. CIRP says nearly one-third of iPhone buyers so far this year are buying the more expensive iPhone 7 Plus. That’s up from about 25% of buyers who purchased the iPhone 6 Plus. That means Apple should be able to “boost average selling prices and margins” this year.

The CIRP data comes from a survey of 300 U.S. Apple customers between Oct. 18 and Oct. 31. All of those surveyed purchased an iPhone in the 30-day period following its release on Sept. 16.

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