Apple losing its cool, loyalty study suggests

Customers more willing to switch to rival brands

Loyalty by Apple dudes to iPhones is on the wane and users are less interested in sticking with the brand’s products in the future, a survey has concluded. Research firm Strategy Analytics says that while 88 per cent of current iPhone owners in the USA are likely to buy another Apple smartphone, that percentage is not as high as last year when 93 per cent of Apple fans said they would be willing to buy a subsequent product.According to the study the decline in Apple loyalty is not just confined to the USA.

It found that only 75 per cent of Western European users would be likely to purchase another Apple handset, down from 88 per cent in 2011.

The change in sentiment parallels Apple’s fortunes on the stock market where, despite being the world’s biggest company by capital, some $70 billion has been wiped off its value since the iPhone 5 release.

Much of the blame has been attributed to negative press stories denting customer interest in future products, aligned with reports that many iPhone 5 users were unhappy with the lack of innovation to the device since the iPhone 4 was released.

“It is the shift in the number of those who are unsure whether they will remain with the same brand for their next phone that Apple should be concerned about,” commented Taryn Tulay, analyst at Strategy Analytics.


Footnote:
Apple paid just 1.9 per cent tax on its earnings outside the USA in the year up to September 2012, a regulatory filing by the company shows, with a mere $713 million handed over as tax out of foreign earnings of $36.8 billion.

Though Apple gives some tax to the country where it sells, it minimises this by adopting creative accounting to shift profits to countries with low tax rates.

One strategy, known as ‘Double Irish With a Dutch Sandwich’ routes profits through Irish and Dutch subsidiaries and then to the Caribbean.

In the UK, the government is under growing pressure to crack down on such avoidance schemes with other US multinationals, including Google and Amazon, similarly criticised for dodging tax.

About Dave Evans

Dave Evans is a long established commentator on both the IT and cellular industries. His current focus is on share price trends within the sector. You can email him here
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