|By||http://e27.cohttp://e27.sg/2013/01/18/apple-launches-installment-plans-in-china-to-better-compete-against-cheap-android-phones/||| Jan 18, 2013 | Asia|
Apple is known for its premium product lines, such as the iPhone, iPad, MacBook and iMac lines. But to better reach out to the mid-range market, the company is willing to extend concessions to consumers to ensure its products don’t get fast overtaken by inexpensive devices from other platforms.
In a first for Apple in the country, the company is offering in-house installment schemes from its online Apple Store in China. Apple is offering its products at three to 24-month installment schemes. Three, six, and 12 month installments carry 0% interest, while 18 and 24 months will be charged an interest of 6% and 8.5%, respectively. Payments must be made through credit card from the China Merchants Bank Co.
Purchases from 30 to 30,000 yuan (US$48 to 4,800) are eligible under this scheme. This should already cover most of Apple’s products, ranging from the cheapest iPod to the more expensive iMac desktop computer line. The latest iPhone 5, launched in China in December last year, costs US$ 850, or about six weeks’ worth of pay for the average urban worker.
Apple is currently in the sixth place in the Chinese smartphone market, as the company had been fast overtaken by rivals running the Android platform. While major carriers China Unicom and China Telecom already carry the iPhone 5, Apple is still trying to strike a deal with China Mobile, the country’s biggest telco, to carry its iPhone line. China Mobile carries about 64% of the country’s 1.1 billion mobile users, although some are already using unlocked iPhones over the carrier’s 2G network.
Mark Natkin of Beijing-based Marbridge Consulting says the company is “trying to figure out how to make products more accessible to [the mid-range] market segment.”
The zero-percent installment scheme is not unique to China, though. Apple also offers no-interest schemes for purchases of more than US$ 1,999 in the U.S. for up to 18 months. The company seems to be offering this scheme to help improve its market position against cheaper offerings from other brands like ZTE and Lenovo, particularly those that run Android or localized variants of Google’s operating system, such as local startup Xiaomi’s MIUI.