Black Friday Validation for the iPad

3 Conclusions to Draw from Strong iPad Sales from Black Friday.

I make a point of staying away from the long lines on Black Friday, instead focusing on the deals on Cyber Monday to take care of my shopping list.  There seemed to be a buzz about the discounts that Apple was offering on its products at the Apple Stores during this past weekend.  I was interested in how this was going to impact the typically crowded Apple Stores.  With a replacement for the iPad2 in the works already, and the deep discounts being offered by the other tablet manufacturers (Playbook was selling for as low as $200!), I was specifically interested in iPad sales numbers from the weekend.  The numbers are in and point to a strong showing for the iPad.

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Larry Dingan of ZDNet wrote about this in his article – Relax–iPad sales are doing just fine.  While the exact sales numbers will not be available for a while, the article talks about some analysis and fieldwork conducted by Gene Munster, a analyst for Piper Jaffary. Dingan writes that Muster’s analysis points to very strong sales of the iPad.  Munster, who estimates Apple will sell 13.5 million units in the December quarter, concluded that the company’s flagship stores were selling 68 percent more iPads per hour than a year ago. Specifically, Apple sold 14.8 iPads per hour at its retail stores. A year ago, Apple sold 8.8 iPads per hour, per store on Black Friday.

Munster further pointed out:

Apple discounted iPads 8%-9% for Black Friday in 2011, vs. 6%-8% in 2010 which likely drove the acceleration in iPad sales that we observed during our 8 hours of Apple retail store checks on Black Friday. Our checks are consistent with comScore data, which indicated that Apple’s online store saw double-digit y/y growth in traffic, and ShopperTrak, which saw overall Black Fri. retail sales up 6.6% y/y (the largest increase since 2007). We believe Apple retail stores outpaced overall retail sales due primarily to rare discounts on the iPad 2.

Since the sales numbers at the retail outlet are good indicators of consumer trends,  but some conclusions can safely be drawn regarding the iPad in the enterprise:
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  1. iPad Market Share – It can be concluded that the same factors that have made the iPad the tablet of choice in the consumer market will also be at play in the enterprise space.  The iPad has a clear lead in enterprise tablet adoption and the challengers have yet to mount any type of serious threat to that position.  Additionally, the consumerization of mobile strategy in the enterprise is even more closely linked to consumer device adoption
  2. Apple’s Profitability – As the numbers point out Apple has been able to maintain the price point only offering few and limited discounts to maintain market share.  This strategy to sell the iPad at a healthy margin allows Apple to innovate and accelerate the product development life-cycle.  This coupled with the slim margins that the competitors are working with will allow Apple to sustain this strategy for a longer period
  3. Apple’s Product Release Cycle – Even though the next iPad is in the works, the sales of the current version continue to be strong.  At the heart of this is phenomenon is the fact that each version of the iPad is a complete product.  While subsequent versions, as expected, have improved on the predecessor, the current version does not feel lacking in the experience it delivers.


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