Who Will Buy the First iPhone? Maybe You!
A new market study shows that most iPhone buyers don't own an iPod already.
June 11, 2007 — -- It has all the electricity, anticipation and pent-up demand of a blockbuster rock tour that's about to go on sale.
Steve Jobs announced at the Apple Developers Conference that there will be plenty of big-name software players in the stadium for the iPhone show, saying the cell phone/music player/Internet device will run all Web 2.0 applications.
And around the country, thousands of people are hatching elaborate plans on how they are going to be one of the first to get their hands on a new Apple iPhone. Residents of big cities are planning trips to AT&T (neé Cingular) stores in suburban or rural areas. Some are betting that jumping on the Web at 12:01 a.m. on June 29 will be their best bet to land an iPhone.
No matter what the plan, there are millions of Americans who will be competing for a first-generation iPhone in what is likely to be the most anticipated tech-product launch in at least a decade.
But the people who will queue up later this month to get the iPhone might surprise you.
Market analysts at Solutions Research Group have run an online poll, trying to get an idea of exactly who is willing to shell out $500 for a mobile/music-player/Internet device from Apple.
What they found might surprise you: About 50 percent of the people willing to shell out half a grand for an iPhone do not already own an iPod.
"That basically suggests that Apple will be able to expand its customer footprint with the product," said Kaan Yigit, president and founder of Solutions Research Group. "It also suggests that its marketing is working beyond the current owners."
The iPhone seems to be garnering interest from people who have not already sipped the Steve Jobs Kool-Aid.
This "non-Apple" buyer interest, said Yigit, is likely the result of the mass of marketing and hype that has surrounded the product's introduction.
"This is remarkable for a product that doesn't exist -- that's been pre-announced six-months prior to its launch," said Yigit.
According to SRG's survey 73 percent of Americans over age 12 have at least heard about the iPhone.
Of the people who say they are definitely interested in buying an iPhone at its current price point, about three-quarters are men. The average of these interested buyers is 31, right in the sweet-spot of the highly valued 18-to-34 year old demographic. Yigit said he was surprised that the average buyer would be this young, as the price of the Apple phone is relatively high. Many companies are now offering feature-rich phones for less than $100 -- sometimes even free.
He said having a younger buyer probably works well for Apple's network partner AT&T as younger users are a lot more likely to buy data and communication add-ons that can yield improved revenue streams to a mobile phone company.
But the iPhone isn't just hitting the youth market. Pretty much every age group shows high interest in the device, with purchase intent falling off in the 50+ demographic.
Solutions Research Group's data also shows that probably iPhone buyers are highly educated (58 percent having completed college) and well-paid (an average household income topping $75,000).
The data also shows that the product might help AT&T pull customers away from one of its competitors.
"We thought that much of the interest would come from existing AT&T customers," said Yigit. "When we looked at how [interest] differed by carrier we saw relatively high numbers for T-Mobile customers -- kind of understandable when you look at the profile of T-Mobile. It's the most urban, cosmopolitan, younger, almost like fashion-forward group of cell phone users out there. They made a success out of Sidekick when nobody else was able to manage that."
According to Apple, the only way U.S. consumers will be able to get an iPhone is by signing a two-year contract with AT&T.
"If somebody says who is the biggest winner in all of this -- it's really AT&T," said Yigit. "In one relatively quick sweep of the wand they inject cool into basically an older institution."
Apple says it expects to sell 10 million iPhone in the first 18 months that it is on the market. Yigit said he's betting that between 5 and 7 million iPhones will be on the streets in the U.S. by December 2008.