5 reasons why the iPhone 5c might be a flop

5 reasons why the iPhone 5c might be a flop

Summary: Rumors are circulating that Apple is cutting orders for the iPhone 5c in the face of weak demand, and this in turn is fueling speculation that the handset might be a misstep by the Cupertino giant. This piece examines why this might be the case.

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TOPICS: Mobility, iPhone
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Rumors are circulating that Apple is cutting orders for the iPhone 5c in the face of weak demand, and this in turn is fueling speculation that the handset might be a misstep by the Cupertino giant.

But if the iPhone 5c ends up being a flop, what's behind the failure?

The iPhone 5c line up
(Source: Apple)

First off, I think that it is far too early to call the iPhone 5c a flop. Even if Apple is cutting orders, this could be part of the normal scaling back that happens following a launch as Apple re-evaluates the supply chain and balances things out. This sort of thing is normal.

Apple likes there to be as short a gap as possible between stuff coming off the assembly line, and that stuff being sold, and strives to have around 4 to 6 weeks of channel inventory. Given that iPhone 5c handsets (of all colors) are shipping within 24 hours, while the higher-priced flagship iPhone 5s is on 2 to 3 week back order, it makes sense for Apple to concentrate more on the iPhone 5s.

Another point worth bearing in mind is that we are unlikely to ever find out the sales figures of the individual handset models as Apple only reports data on iPhone sales as a whole. So if iPhone 5c sales are poor, but this is offset by strong iPhone 5s sales (and there's data to suggest that the latter is outselling the former by a significant margin) then the overall effect on sales will be hard to notice. Pundits and analysts like to focus on iPhone sales figures, but revenue and margin data are more telling and as a rule are better indicators of the health of the product line.

Finally, it's worth pointing out that a lot of people who buy handsets are locked into contract and upgrade cycles, and this could mean a delayed or extended upgrade cycle that extends well beyond the initial release. This may be doubly so for the non-flagship handset where consumers might be unwilling to pay unlocked prices to get their hands on the phone and instead wait until they are eligible for a subsidized upgrade.

But, if despite all I've said above, the iPhone 5c is judged to be a flop, what could be the reason behind it being a flop? Here are five possible reasons why.

1) Old model in new clothes

While the iPhone 5c is undeniably a new handset, under the shiny polycarbonate shell it is essentially a rebadged iPhone 5. While it is unquestionably an upgrade for anyone running a non-retina display iPhone, for those already owning an iPhone 4s or iPhone 5, there's not much new beyond the color.

2) No sane color option

The iPhone 5c comes in white, pink, yellow, blue, and green, there's no subdued black/charcoal/space grey option. Given that a black (or a variant on black) has always seemed to be the most popular choice of finish, the fact that it is not on offer might be putting a damper on sales.

On top of that, the lack of a red option is particularly surprising, especially given Apple's desire to gain a foothold in the Chinese market (red is a color traditionally seen as symbolizing good fortune).

3) Stuck with one color

You can dress up the iPhone 5c is different colored silicone skins (at $29 a pop) or you can use third-party cases, but as to the actual color of your handset, you're stuck with it for the duration of ownership.

For the trendy or teens with short attention spans, this is a concept that might not float.

As an aside, the most popular color in the UK according to iPhoneStockChecker is pink, accounting for 46 percent of sales, followed by blue at 32 percent, and green at 12 percent. White is low down the list at 9 percent, and the yellow version seems to be the ugly duckling, only chosen by one out of every 100 buyers.

4) Price shock

Apple lists an unlocked 16GB iPhone 5c at $549, which is only $100 less than a 16GB iPhone 5s. You can pick up unlocked handsets for less than this, but that high official price – which got a lot of press attention at the iPhone unveiling – will have undoubtedly put some people off.

5) Second best

The popular perception is that iPhone buyers are swayed by style, and that owning the attest and greatest handset is a status symbol of sorts.

While there no denying that the iPhone 5c is a new handset, it isn't a flagship handset, and with so much attention focused on the iPhone 5s, does this make the iPhone 5c seems a lesser, inferior, second best purchase?

The bottom line

Apple CEO Tim Cook is on record as saying that the company doesn't fear cannibalization, and that extends as far as its own products cannibalizing one another. At the end of the day, whether consumers are buying the iPhone 5s or the iPhone 5c (or the older iPhone 4s), people are still buying an Apple product as opposed to the competition.

If the iPhone 5c is a viable product, then chances are that we'll see similar models coming down the pipe in the future, if not, then we may see Apple shift away from this approach. This is how businesses do business.

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Topics: Mobility, iPhone

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77 comments
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  • the worst is that

    if you want a colorful iphone, you get 5 and put it into plastic case (plenty of choices) and its still thinner than 5c! besides, there is choice of facing color (white/black) while 5c offers you only black. so why would anyone want 5c rather than 5??
    polarcat
    • Apple made the 5c Ugly on Purpose!!!

      The reason is quite simple. It was simply a way to confirm it's plastic was "Perfected Plastic Cheapness"! ......and once they had accomplished that, everyone would flock to buy their gloriously cheap die cast only new pot metal, iScratchGate and iBendOverEasy to Crack and Break at the volume buttons case/frame over Samsung's Cheil Chemical Industries far superior Infino Brand Polycarbonate. Die Cast Aluminum is cheaper to make because of the recycling credits due to the beer cans it's made from. All so they and their share holders can all sit back laughing while keeping profits high and their iDiot fans properly fed by the greatest propaganda machine since Hitler had Jews marching into showers in their Death March Concentration Camps!
      http://www.youtube.com/watch?v=-ZiT8AlhUMQ

      iOS 7? Oh.... that's all perfect.... except for a few bugs... stolen from Microsoft Windows. Like Blue Screen of Death, Slow Transitions, but it's sissified color scheme and icons were taken from Lisa Frank for their all NEW... Pastel Girly Girl UI!

      That part is just an effort to ensure their "Planned Obsolescence" business model continued to have them raking in higher profits in the future. In order to make sure their fans would be ready to buy next year's Newer NEW NEWEST iOS 8 on iPhone 5.5s!

      Sir Joni Ive invented everything, Steve and Scott just stole credit for all my success, is just so enamored by his own genius in getting Scott fired and him put in charge of software development of iOS. Along with getting back at Steve.... with his pretty in Pink and blue screen of death colors!

      Naturally the purchase of Authentec fingerprint sensor out from under HP, Motorola, Samsung, etc is just a statement of the fact, that Sir Joni Ive Invented Everything is a better Thief than even Steve could be so shamelessly proud of! ;-P .....he even managed to top the thievery of "We've always been shameless about stealing great ideas."
      http://www.biometricupdate.com/201305/rumors-point-to-an-embedded-fingerprint-sensor-for-galaxy-devices

      Only it backfired on them and Motorola, Samsung and HP are all snickering and cracking jokes about how they duped the biggest THIEF of them all into buying Authentec's Biometric Sensors they already knew would fail. The plan was make Apple think Authentec was the greatest so they'd rush in and buy it like they always do and it Worked!!! :DDD

      Meanwhile.... Samsung, HP and Motorola all went to Validity Inc. Who has been in the Biometric business longer and has far superior technology that wouldn't have gotten duped by that ages old HACK in the first place!
      http://www.validityinc.com/

      And the Samsung and Motorola/Google diversion in the bidding war for Authentec worked to perfection with Apple paying twice what Synaptics paid for Validity Inc's far superior deep scan into the live skin layers technology. That wouldn't have fallen to that merely live pulse print Hack killing Apple's New theft of Authentec's technology!!! ;-P .....which just goes to show, Crime Still Doesn't Pay and being shamelessly bold can turn into embarrassment quite easy!!!
      KronJohn
      • ... about Jony

        here...
        http://www.urbandictionary.com/define.php?term=jony+ive
        ios7-sucks
    • My Reason

      I was bumping up against storage on my 16GB 4. So I walked in, asked if a 5s was available. It wasn't. So I went for the 32GB 5c and got it for the same cash-out as the 16GB 5s.

      I spent the last 12 months not getting a 5. I guess it was not meant to be.

      I wouldn't have mentioned, except you asked. YMMV. I do like my 5c. Haven't gotten a cover for it, yet.
      DannyO_0x98
  • At $549

    for the cheap version, I wouldn't fear cannibalization all that much, either.
    WebSiteManager
    • Perception and Expectation

      Initially the info was the 5C would be the "market entry" iPhone. Surprise, Surprise!

      For the cost it makes much more sense to get the 5S or an existing 5 instead of the 5C. Perhaps they were hoping they could tag into the niche that wants a "phone" on their colorful iTouch?
      rhonin
      • Reality in the marketplace.

        Yep. That's not an "entry level" phone. I was reading about the ZTE Open Firefox OS phone selling for $80 without a contract.

        Now, Apple doesn't have to be that low on price, but damn, Apple isn't entrylevel by any means; and also, even if you shell out this kind of cash, and a $155 per month contract, (Like on Verizon-- see nypost.com/2013/10/17/verizon-increases-cell-bills-7-1-for-95m-customers/ ) you still have to get it unlocked to get a better rate...
        donald duck 313
    • Lucky

      the 5c is around $820 over here in Europe. That makes it over $200 more than a premium Android (Galaxy S4, htc One) or Windows Phone (Nokia Lumia 925).

      If you are in the Apple eco-system already then you'll probably go straight for the 5s. If you aren't already in the Apple eco-system then you'll probably look elsewhere and have enough left over for a holiday in Ibiza next summer.
      wright_is
      • That is not how Apple consumers think

        The price keeps coming up here, but let's face it, Apple consumers are irrational about money. They would spend even more on the same device. I'm surprised Apple doesn't slowly raise their price. This is one reason why Apple has apps first. The Apple consumer spends money like its going out of style, while Android and WP consumers tend to be more hesitant about spending. Any article that talks about Apple and price, doesn't understand the Apple consumer.
        A Gray
        • Wait.

          You're talking about users spending money foolishly? Look at Windows 8. Who in their right mind would shell out over $100 for that ugly mess? Microsoft raised prices for a failed tablet (the Surface 2 Pro can actually set you back $1.930). Who in their right mind would pay over $1,900 for a netbook with a touch screen? It is too small (display), to call it an Ultrabook, too expensive to call it a tablet. Yikes Microsoft must think you're Stupid, lol.
          I hate trolls also
          • Apple fans would ...

            ... if it was made by the fruit company.

            And just for comparison sake, the Surface pro 2 is $1,799.00 for the top model (512 gig ssd, 8gig ram, core i5) in Canada. The top ipad model is $929.00 (128 gig ssd, 1gig ram, core a6x). Yes the Pro is almost twice the price but for that you get 4x the storage, 8x the ram and a cpu that is infinitely better, not to mention an active wacom digitizer so in my opinion it is worth is.

            Mind you, for only $270 more than the top of the line ipad you can get the Pro 2 with 256 ssd, 8gig ram, and i5 cpu. Personally this is the one I'm going for 'cause Apple ignored graphic artists when they made the ipad.

            Funny that they were the ones who were known for building computers for creative people, but it took ms to build a tablet that is perfect for photoshop...
            unoriginal
        • apple consumer

          apple consumer = i iDiot... for how long though?
          zodbuster
  • it's not just scaling back supplies

    it's also price cuts less than a month of it's release from Walmart, Target, Best Buy etc.
    jonandkelly
  • 50,000 Reasons why Windows Phone IS A FLOP....

    .... !
    5735guy
    • Flop?

      In the US it is still a flop. Meanwhile, in many Europeans countries, it carved a very decent market share.

      Also, for a "flopped" platform it already had a MAJOR influence on the UX design of all competing mobile OS. Nice failure isn't it?
      TheCyberKnight
      • Re: in many Europeans countries

        These phones only sell, because of the Nokia name on them. Nokia has extremely good reputation in Europe. Years will pass, before it erodes more.

        Let's see, how the next "Microsoft" model will fare.
        danbi
        • No, they sell because they are inexpensive yet good quality

          You've obviously not checked out the 520 or 521. These phones are $100 off contract (and remember most Europeans need to buy the phone out right). So if you go into the store and see an iPhone for $850, an S4 for $650 and a Windows Phone for $100, which do you lean towards? Especially a family of 4? Think about shelling out $3400 for a family of 4 or $400. It starts to look rediculous to go Apple, which is the problem Apple has there.

          The Lumia 520 (I own one), is pretty snappy with an upgradable MicroSD to boot.

          I think outside the US, people understand that a phone is just a portal to email and text with a few apps where needed. We in the US tend to identify our personality by which phone we carry, as if it makes us a better person (or someone else a lesser person).
          A Gray
          • Unusual Push

            The success of the Nokia 500 series is pretty evident by sales, but this was an unusual kind of product push. Nokia dropped their margin on these devices to about 5%. This is the same Nokia that was making 10% or more on their $50 candybar phones and 15% on low-end Asha smartphone. Apple's making 30% across the board, probably even more on the iPhone 5c, it being a revamp of the mature iPhone 5.

            The other factor is the specific market. High-end phones have an MSRP driven entirely by the US carriers' subsidy system. Apple doesn't sell you or me a phone, they sell them to Verizon and AT&T. Those carriers negotiate a price based on the MSRP, with the specific intent of driving the MSRP to a point where very few people will ever buy. Lacking this market dynamic, the iPhone 5s might be introduced at $399 or $499, but there's no way on earth it sells for $849. And consider, the Nokia candbar phones sold at Verizon or AT&T (well, online at least; "dumb" phones are all but extinct at carrier showcase stores) carry an MSRP of $150-$200. Total fiction.

            But elsewhere in the world... even in the USA, next door at Cricket or some of the pre-pay vendors who don't subsidize phones, you'll see rational prices. Wherever you can shake that carrier influence on price.
            Hazydave
          • Yes I have a Nokia 520 too!

            Good solid phone! Happy indeed and works well for my small business!
            martin_js
          • agreed

            Hi
            Great comment.. I did exactly the same thing for our family.. very pleased with the costs and performance of the the 520.
            I do live outside the US and realize that a phone is not a status symbol as it is in the US
            zodbuster