Apple Back to School promotion off to strong start, analyst says
In spite of initial skepticism from industry watchers, Apple?s annual Back to School promotion is off to a strong start, pushing a fourfold increase in Mac sales over that of Windows PCs by college students in some circles.
Global Equities Research analyst Trip Chowdhry issued a note to investors earlier this week pointing out that education sales of Apple?s Macs have been significantly outselling Windows PCs. The firm?s research indicated that ?80% of incoming students are buying Apple Computers vs. Windows Computers.?
Apple this year is offering education customers a $100 iTunes store credit with the purchase of a qualifying Mac. The deal was originally thought to be less attractive than the promotion from recent years, but, based on the recent statistics, interest in this year?s promotion has not suffered as a result of the change.
Interestingly enough, though Apple?s advertisements suggest students would use the credit to buy apps from the Mac App Store, most are choosing to buy songs. The report also notes that Senior students are showing ?strong interest? in purchasing an iPad before school begins, while more students attending online universities such as Phoenix Online are buying Macs than in years past.
Chowdrhy also reports that Apple is enjoying substantial success in the Enterprise. New data indicates that ?probably about 35% of Fortune 500 companies are giving Apple as a Choice to its employees, and majority are preferring Apple over Windows.?
The report believes that Apple's gains are a result of ?the success of iPad is putting pressure on Enterprise IT to not only support iPad, but also Apple iPhones and Apple iMacs and MacBooks,? going as far as to say that high-level executives are ?influencing the IT to bring Apple products into the Enterprise.?
GER predicts that iTunes will contribute $13 billion in revenues in fiscal 2013, due to increased support of Apple?s iBook Store and rising sales in App Store, which has recently passed 15 billion downloads.
In one final comment sure to please the Cupertino, Calif.-based iPhone maker, the firm?s report suggests that the ?Apple iOS Developer Ecosystem continues to grow at the expense of Android, RIMM and Windows.? Chowdhry said ?developers are increasingly developing? for iOS, with iOS 5 serving as ?another catalyst? in shifting developer momentum.
To conclude, GER adjusted its revenue estimates upward ?to reflect a strong back to school sales of Apple computers, market share wins of Apple in the enterprise and acceleration in Apple?s iBook and AppStore.? The analyst predicts the ?Other?s category? in Apple?s iTunes will have a compound annual growth rate of 39 percent over the next three years, though he cautions that rising gasoline prices could negatively affect ?all Equities including Apple.? The analyst reiterated the firm?s 12 month price target of $400.
Global Equities Research analyst Trip Chowdhry issued a note to investors earlier this week pointing out that education sales of Apple?s Macs have been significantly outselling Windows PCs. The firm?s research indicated that ?80% of incoming students are buying Apple Computers vs. Windows Computers.?
Apple this year is offering education customers a $100 iTunes store credit with the purchase of a qualifying Mac. The deal was originally thought to be less attractive than the promotion from recent years, but, based on the recent statistics, interest in this year?s promotion has not suffered as a result of the change.
Interestingly enough, though Apple?s advertisements suggest students would use the credit to buy apps from the Mac App Store, most are choosing to buy songs. The report also notes that Senior students are showing ?strong interest? in purchasing an iPad before school begins, while more students attending online universities such as Phoenix Online are buying Macs than in years past.
Chowdrhy also reports that Apple is enjoying substantial success in the Enterprise. New data indicates that ?probably about 35% of Fortune 500 companies are giving Apple as a Choice to its employees, and majority are preferring Apple over Windows.?
The report believes that Apple's gains are a result of ?the success of iPad is putting pressure on Enterprise IT to not only support iPad, but also Apple iPhones and Apple iMacs and MacBooks,? going as far as to say that high-level executives are ?influencing the IT to bring Apple products into the Enterprise.?
GER predicts that iTunes will contribute $13 billion in revenues in fiscal 2013, due to increased support of Apple?s iBook Store and rising sales in App Store, which has recently passed 15 billion downloads.
In one final comment sure to please the Cupertino, Calif.-based iPhone maker, the firm?s report suggests that the ?Apple iOS Developer Ecosystem continues to grow at the expense of Android, RIMM and Windows.? Chowdhry said ?developers are increasingly developing? for iOS, with iOS 5 serving as ?another catalyst? in shifting developer momentum.
To conclude, GER adjusted its revenue estimates upward ?to reflect a strong back to school sales of Apple computers, market share wins of Apple in the enterprise and acceleration in Apple?s iBook and AppStore.? The analyst predicts the ?Other?s category? in Apple?s iTunes will have a compound annual growth rate of 39 percent over the next three years, though he cautions that rising gasoline prices could negatively affect ?all Equities including Apple.? The analyst reiterated the firm?s 12 month price target of $400.
Comments
The deal was originally thought to be less attractive than the promotion from recent years, but, based on the recent statistics, interest in this year?s promotion has not suffered as a result of the change.
I'm not surprised by this. Apple doesn't need to do any ridiculous deals or make outrageous offers in order to entice new customers.
I love the part where it says high-level executives are ?influencing the IT to bring Apple products into the Enterprise.? Sweet.
I'm already hearing about it with the iPad. Investment banks that didn't have any Mac products outside their print-shops are now looking at issuing their salesmen and brokers with them. Soon IT departments will be expected to supply and support in-house apps for them. Then hopefully the bridgehead will be secured and the apple hordes can storm the windows citadel, bringing polished GUI's and unix based reliability to us all.
I can dream.
I'm not surprised by this. Apple doesn't need to do any ridiculous deals or make outrageous offers in order to entice new customers.
I think it's more that every student already has either an iPod or an iPhone anyway at this point. The old offer just didn't make sense.
I love the part where it says high-level executives are ?influencing the IT to bring Apple products into the Enterprise.? Sweet.
Uh, can't "high-level executive" wield more than "influence" with their IT departments? Like maybe the novel notion of mandating that Apple products be part of the mix?
It's time to break the stranglehold that MS' shills, the corporate IT drones, have on innovation, choice, and creativity in the selection of such devices by employees.
Uh, can't "high-level executive" wield more than "influence" with their IT departments? Like maybe the novel notion of mandating that Apple products be part of the mix?
It's time to break the stranglehold that MS' shills, the corporate IT drones, have on innovation, choice, and creativity in the selection of such devices by employees.
I'd love to agree with you and say they "mandate" Apple products, but there are so many legacy systems and software packages out there that are Windows (or if web based, IE 6) reliant. So you can't just abandon ship.
Uh, can't "high-level executive" wield more than "influence" with their IT departments? Like maybe the novel notion of mandating that Apple products be part of the mix?
It's time to break the stranglehold that MS' shills, the corporate IT drones, have on innovation, choice, and creativity in the selection of such devices by employees.
For a big firm with a huge entrenched IT function, ordering IT around is like ordering around your drug dealer. Yes, you are his customer, but you are also dependent on what he supplies you - so negotiations are somewhat more delicate.
Often in big firms the IT departments metastatize, with business areas hiring their own IT guys to try to avoid the ossified central IT and their refusenik attitude to any request. Then phases of recentralization take place to try to rein in spending, leaving the central IT department trying to manage a ton of projects that it didn't create in the first place.
Add in that you probably outsourced half your low level grunts to Bangalore, and now you're stuck with long term contracts to a firm out there with no mac expertise and probably precious little with windows.
The result is a huge great hairy mess.
I think it's more that every student already has either an iPod or an iPhone anyway at this point. The old offer just didn't make sense.
Perhaps, but there is a damn new iPod touch every year that is clearly more capable (new and/or better sensors, faster graphics, etc). In any case if this survey is accurate the news for MS is more dire than I could imagine. Even the nuclear option (free xBox! vs $100 iTMS gift card) fails to entice. Maybe 80% already have an xBox.
you are right, there IS a hot, new, more capable one out every year...and it typically debuts the week after the promotion ends, so you are always going to be just behind the 'cool' curve.
…companies are giving Apple as a Choice to its employees, and [the] majority are preferring Apple over Windows.
Well duh!
I have to buy a MacBook Air for HS next week as soon as they are released (school just made MacBook obligatory for next HS term) but there is no promo. A real PITA.
But why no BtS campaign in Japan AS Shibuya and AS Ginza?
I have to buy a MacBook Air for HS next week as soon as they are released (school just made MacBook obligatory for next HS term) but there is no promo. A real PITA.
MacBook is mandatory in a HS in Japan? Wow!
I think it's more that every student already has either an iPod or an iPhone anyway at this point. The old offer just didn't make sense.
Then why didn't Apple provide a $229 iTunes voucher?
This Chowdry report does not make sense. While it is true that the Apple Back to School campaign is currently running, school is OUT right now! How can he possibly assess that "?80% of incoming students are buying Apple Computers vs. Windows Computers" when students have been more outgoing rather than incoming?
Maybe they have some sort of occult connection, a black magic spell that let's them know who will attend school next year...
Perhaps, but there is a damn new iPod touch every year that is clearly more capable (new and/or better sensors, faster graphics, etc).
you are right, there IS a hot, new, more capable one out every year...and it typically debuts the week after the promotion ends, so you are always going to be just behind the 'cool' curve.
Unless you're in the southern hemisphere :-) in which case the back to school promo starts after the shiny new stuff has been released...
Everyone can't just accept what these guys have to say as indisputable fact when it suits them and call them charlatans when it doesn't.
Global Equities have a $400 price target on AAPL. That alone should mean the author needs to at least verify the source.
Where is the research? What methods did they use?
They say "our research indicates that ~80% of incoming students are buying Apple Computers vs. Windows computers".
So does that mean 8 out of 10 computers sold to students were Macs?
Or maybe it means 8 out of 10 computers sold to students who had a choice between Windows and Mac choose Mac.
Or maybe it means 8 out of 10 students they polled walking out of an Apple store bought a Mac instead of Windows.
I'm not saying the research is wrong. I'm just saying we need to see it to make up our own minds.
Then why didn't Apple provide a $229 iTunes voucher?
Because the cost to Apple of $100 of iTunes music is probably around the same as a $200 iPod. You realize that their margins on music are far lower than on hardware right?