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With Apple tablet sales dwindling, the company is hoping a new series of iPad ads will draw in more buyers.
Dubbed “Everything changes with iPad,” the new ad campaign attempts to explore the many ways that people can use the tablet. Displayed on Apple’s website, a 90-second video shows adults and children alike using the iPad to learn to prepare a meal, chat with family members, design a floorplan and snap photos of loved ones. The site then segues into individual pages that tell you how to cook, learn, and travel with the iPad, among other tasks.
Apple certainly needs help generating greater demand for its tablet. The iPad has seen its once stellar sales and market share continue to dwindle over the past few years. Announcing its fiscal second-quarter results on April 27, Apple revealed that iPad sales hit its fifth consecutive decline to 12.6 million units from 16.4 million a year earlier. Analysts had been forecasting 14.1 million iPads, according to a poll by Fortune.
Why the downturn in iPad sales? There are several reasons.
People are holding onto their tablets longer and sharing them with family members, so there’s less of a need to buy new ones. And instead of purchasing both a mobile phone and a tablet, more consumers are opting to buy bigger-screened iPhones, or phablets, such as the iPhone 6 Plus with its 5.5-inch screen.
Apple has also seen its tablet share drop as more Android tablets have hit the market, competing for customers. Though the downturn in tablet sales has affected most vendors, including Samsung, Asus and Amazon, Apple has been hit hard. A February report from research firm IDC pegged the iPad’s tablet share in last year’s final quarter at 28.1 percent, down from 33.1 percent in the same quarter for 2013. For 2015, IDC predicts that share will sink even further to 26 percent.
Further, tablets aren’t like smartphones. Most consumers hang onto a smartphone for a certain period of time, typically two years under a standard contract, and then upgrade to a new model. Smartphones, such as the iPhone, usually offer enough compelling new features and improvements to convince people to buy the latest model. But aside from enhancements in speed, thinness and display quality, tablets don’t really improve all that much.
For example, my wife still owns an iPad 2, which she purchased in 2011. It still works fine. It serves her purposes. So she feels no need to spend hundreds of dollars to buy the latest iPad Air 2. That’s the challenge Apple faces with existing iPad owners — giving them a reason to buy the newest model.
With consumer sales of tablets dropping, Apple formed a partnership with IBM last summer to offer apps geared toward business and industry. As part of the pact, IBM is also selling industry-focused iPhones and iPads as a bundle.
During Apple’s earnings call, Cook admitted that people are buying iPhones and Macs instead of iPads, but he said Apple isn’t worried about that trend. He said he expects iPad sales to stabilize at some point but couldn’t forecast when that would happen.
“I believe the iPad is an extremely good business over the long term,” Cook said. “When precisely it begins to grow again, I wouldn’t want to predict, but I strongly believe that it will.”
In one of its new ads known as “Why iPad?” Apple touted the tablet as a camera, a library, a movie theater, a teacher, a game console, a business partner and a coach, saying that “it’s so powerful and easy to use you won’t want to put it down. Yet it’s so thin and light, you won’t have to.”
All of that may be true. But whether the ads will persuade more people to buy the iPad is the big question.
(Via Business Insider)
