iPhone SE: Apple's second attempt

It’s been few weeks since the iPhone SE was launched and the reviews which are coming in are definitely positive, like it has been for every other iPhone barring the 5C. As ironic as it may sound, the SE is going to replace the 5C which was by far Apple’s least selling smartphone. Has Apple learnt from its absurd positioning? Does the new positioning make a mammoth difference to the perception of an iPhone buyer?

Firstly, Apple is an aspirational brand. A first time iPhone customer is buying the product since he believes it’s time for an upgrade from a plethora of android devices he has been exposed to/has been using. This is where the 5C failed to connect with its target. Though people wanted a cheaper iPhone, they didn’t want it to be positioned as a cheaper device. The plastic externals (read ‘polycarbonate’) along with the ‘C’ suffix only strengthened the messaging that it was a cheap device. The result- “Apple for the first time struggled to dispose its inventory”.

Apple has learned from the debacle and is now back with a better message for the audience and it’s targeting ‘two segments’ in the process. There are multiple entities that Brand Apple has capitalized on, viz. the final product (design and the likes), the pricing and most importantly the positioning, have converged to become that convoluted piece of the emerging market puzzle that has eluded brand Apple in the past! Let’s take a look at what’s changed in the product and the approach that definitely betters Apple’s chances vis-à-vis their previous futile attempt-

1. The product launch: The close parallel I can draw here is that of the launch of iPhone 5S and 5C. As obvious as it may sound, the 5S hogged the limelight with 5C mostly construed as a cheaper offering. The sacrifices made were very evident. “Cheap” plastics, outdated hardware, paltry performances for an Apple device, Jony Ive explaining that iPhone 5c was ‘unapologetically plastic’, the shortcomings in the product and the messaging were endless. The iPhone SE had its own launch event, thereby the focus was entirely on one device and that makes a huge difference, add to that the entire presentation talked about how closely it resembled the iPhone 6S and that does help in erasing apprehensions about the product being a cheaper (sacrifices ridden) device. (PS: This is what Samsung does to differentiate its Galaxy S series against the Note series and it has done wonders for Samsung, albeit both of them are premium offerings. 
2. Ideal combination of Old & New: The SE cannot be written off as a mere repackaging of yesterday’s technology. I would rather call it a right mix of previous gen and current gen phones to convince the buyer that the sacrifices aren’t too many and at the same time ensuring that Apple clings on to its jaw dropping margins. To best summarize the SE- Take the iPhone 5S, bring the A9 processor and the 12 megapixel iSight camera from its larger sibling and we have the basic ingredients to Apple’s most economical iPhone ever. The bottom line- SE doesn’t prioritize on being a budget offering compared to the 5C (which had budget/cheap written all over it) 
3. Positioning and strategy: I’ve always been a big fan of Apple’s branding strategy and its positioning is a lesson for every premium brand out there. For ease of understanding, I’m going to harp some more on the comparison with the disastrous 5C. So who needs to buy the iPhone SE? Simply put- “Individuals who want to move to Apple from Android”. It is implicit that customers want to make that move from budget Android offering to reasonably priced (aka mid-range) Apple devices which do not explicitly position itself as a cheap offering. The SE ticks all the checkboxes doesn’t it? Compare that with the iPhone 5C, “the candy coloured horrendous offering that emulated Chinese rip-off”. The SE is an extremely important device for Apple from a long term strategic standpoint to bring new customers on board. Repurchase/Repeat purchase has been driving iPhone sales, but that model isn’t a sustainable one if they intend to grow at the staggering pace that they continue to grow at. 
4. Pricing: the SE is by far the best bang for buck mid-range offering in the market. It has the perfect mix to justify its price and the price conscious android user, will not feel intimidated by the price-to-value proposition. If I had to pit it against an android offering, there is not a single Tier I OEM out there which equips its mid-range offering with flagship specs. At $400 I can’t think of a better device which helps me leverage on a premium brand’s snob and still not compromise on what’s cooking in the device. 

The SE is definitely a welcome move from Apple. It’s well more than just “old wine in a new bottle”. The top of the line A9 processor, the latest flavour of iOS, the premium build, which is so reminiscent of the original Apple, the SE certainly holds its own in the market today.  But it’s not without its flaws, although that’s a statement I would make with most devices in the market today. As somebody who has watched the smartphone space closely for over a decade, I certainly believe that the SE will do well, maybe not as well as its elder sibling, but definitely good enough to send shivers down the spines of other OEMs who operate in that price point