Apple's iPhone trade-in program: Can it prime the upgrade pump?

Summary:Apple's trade-in program could entice customers to swap out those iPhone 4 devices for a fresher model.

Apple is reportedly prepping a trade-in program in its stores that will allow customers to trade up iPhone 4 and iPhone 4S devices to new models. The larger question is whether Apple's outreach can break the two-year carrier contract lock-in and boost refresh cycles.

According to 9to5Mac, Apple is training its retail workers to handle trade-ins. There are other trade-in deals at Best Buy and other places, but Apple's retail reach could have a real impact.

Key points to note:

  • Apple wants to control more iPhone sales compared to today's channel picture, which revolves around carriers.
  • Apple thinks it can upsell to other goods like iPads and Macs.
  • And Apple would like to have a system to smooth out lumpy iPhone sales.
  • TechCrunch noted that limited pilots have been underway for weeks.

What's unclear here is what Apple will offer for trade-in handsets relative to others. It's also unclear whether this program will prove to be little more than a customer service win or maybe even a gimmick. Here's what's clear: Apple has to do something. By putting iOS 7 on older iPhone devices it gives customers an excuse to stick with older hardware. 

iphoneupgradeprogram

 

On the surface, Apple's trade-in program makes a lot of sense. In the war against Android, Apple's biggest asset is its direct reach through its retail stores.

In the end, the devil will be in the dollars and return on investment to consumers. Apple's ability to add features and new toys will also play a role. Apple will have to thread the needle between dangling trade-in carrots and sparking gadget lust.

Topics: Smartphones, Apple, iPhone, Mobility

About

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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