Please ensure Javascript is enabled for purposes of website accessibility

Who Is Apple's Favorite Customer?

By Jeremy Bowman - May 25, 2016 at 6:21AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The iPhone-maker has a broad appeal, but a certain group of customers is more likely to choose its products.

Apple (AAPL -1.80%) has become a cultural touchstone around the world, as familiar as any other global brand. The iPhone-maker now has over 1 billion installed devices globally, and more than half of American households own at least one Apple product.

The company has long had a reputation for being popular among hipsters, a notion that Apple and rival Samsung (NASDAQOTH: SSNLF) have each reinforced through marketing. Apple has successfully presented itself as a species distinct from other device makers with ad campaigns such as "Think Different." Conversely Samsung's commercials have depicted Apple devices as followers, mocking the fanboy cult around the company.

Apple is also known for being popular among techies as research by Crittercism said that San Francisco and New York, had a high proportion of Apple users with 80% of San Franciscans choosing an iOS device, while "lower-tech" cities like Phoenix and Detroit found Android more popular. 

Yet, another study seemed to contradict both of the above stereotypes. Slice Intelligence found that the highest-spending Apple customer in the US was in fact, a man over the age of 65. That demographic shelled out an average of $976 between October 2014 to September 2015, compared to the national average spend of $788. 

The study found that spending tends to increase with age -- perhaps as earnings and disposable income also increase -- and it also showed that men outspent women by a considerable margin. Men on average spent $897, compared to just $633 for women, and women 18-24 spent the least. Slice theorized that the spending by older Americans may be because they tend to be on the late side of the adoption curve. They could be new buyers, or alternatively, are shopping for Apple products as gifts. The survey also found seniors were among the greatest purchasers of iPads, while the 25-34 demographic led purchases of iPhones and Macs.

Another study from Consumer Intelligence Research Partners found that nearly half of iPhone buyers are repeat customers, upgrading from an old iPhone. The study also showed that Apple attracted three times as many Samsung customers to switch to iOS, as Samsung did to Apple.  

Globally, Apple now sells more iPhones in China than in any other country, making the world's second-biggest economy its most important market. Regionally, Apple draws about a third of its sales from the Americas, with Europe, Middle East, and Africa contributing another 22%. Asia delivers the balance, and by market share, the iPhone is most dominant in Japan.

A company like Apple can't really have a single favorite customer as you don't grow to $200 billion in annual revenue without mass appeal. However, if there was a composite figure of its most important customer, it would probably be young, affluent, upwardly mobile, Chinese males. As Apple attempts to swing back to growth in the world's most populous country, targeting that consumer is likely to yield the greatest benefit.

 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$136.72 (-1.80%) $-2.51

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
317%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.