Apple is offering significant price cuts in China as it participates in the annual “618” shopping festival. The company is facing tough competition from Chinese smartphone manufacturers and declining market share, prompting it to slash prices of its smartphones on Tmall by up to 23%. The price cuts are aimed at boosting sales during China’s second biggest online shopping event of the year. The discounts are the largest Apple has ever offered in its biggest overseas market, according to Chinese state media.
The “618” shopping festival, launched by JD.com in 2008, has become a major event in China’s retail calendar, second only to Singles Day created by Alibaba. The festival features weeks of promotions and discounts across various e-commerce platforms and brick-and-mortar stores to attract customers. International stars like Rihanna also participate in the festival by promoting their products through live streams on popular Chinese platforms. While Apple had been reducing prices in China since October, the current discounts on iPhone 15 models are the biggest to date.
Apple’s market share in China has declined to 15.7% in the first quarter of this year, compared to 19.7% a year earlier. In contrast, Chinese smartphone brands like Huawei have seen significant sales growth, narrowing the gap with Apple. Following the recent price reductions, Apple’s iPhone 15 now competes in the same price range as smartphones from Xiaomi and Huawei. The company is facing pressure to defend its market share in China amidst intense competition and changing consumption patterns across various sectors.
The price war in China extends beyond smartphone makers, with companies in various industries offering big discounts to attract customers. The 618 shopping festival has become a key indicator of consumer consumption trends in the country, with e-commerce sites and retailers vying to offer the best deals. However, some companies have chosen to boycott the event due to the aggressive pricing policies that require significant discounts. Over 50 book publishers issued joint statements expressing their opposition to the chaotic price wars during the shopping festival, emphasizing the need to maintain market stability.
In response to the aggressive competition and price cutting during the 618 shopping festival, some companies are pushing back and calling for more effective control over discounting practices. Major state-owned publishing companies have also voiced their concerns about the disorderly competition in the market. The industry’s resistance to chaotic discounting reflects a broader trend of companies in China reevaluating their strategies in an increasingly competitive marketplace. The pricing policies during the shopping festival highlight the challenges faced by businesses in balancing sales growth with maintaining market stability and profitability.
