By Star Chang, posted Jan 20, 2012 at 12:39 AM, 815 views,

Is Apple Helping its Rivals to Sell More Phones During Lunar New Year ?

Apple is properly missing out on the Chinese New Year sales ‌in China. Apple stopped selling all iPhones at its five China outlets on Jan. 13 after customers pelted the flagship store in Beijing with eggs because the company had cancelled the opening sales for the iPhone 4S. Pulling all iPhones from the company retail stores, it will give its competitors a potential boost during the country most important gift-giving season. According to the government statistics, the one-week new years holiday, which begins Jan. 23, had generated $64 billion in retail sales last year …

Apple, declined to comment on the sales impact of removing iPhones from company stores or say when the devices would return. iPhone 4S has already sold out at the Apple online store in China, it only remains available through carrier China Unicom or limited stock from authorized resellers. No iPhones for sale during the Chinese new year holidays may help Samsung and other competitors which used Android OS increase their footholds in the world’s largest mobile-phone market. Chinese New Year is the most important period for sales promotions due to the culture of gift-giving. The Chinese will usually received their extra year-end bonus salaries which make the rise of spending.

Apple sold 5.6 million iPhones in China during the first nine months of last year, making it the No. 4 smartphone vendor in China in the third quarter. But the market share for Apple has dropped to 10.4 percent in this third quarter from 13.3 percent the quarter before, while Samsung’s jumped to 19 percent from 15 percent in the same period. Headlines about scarcity of iPhones and customers camping out have proven a highly effective marketing approach in China, but the Beijing incident shows the need for Apple to rethink its approach. Most worrying is the potential loss of good will, there might be of chance of real demand permanently lost.

The events happened in Bejing’s Apple store has crossed the line from scarcity to just downright scary, both for Apple and the local authorities. Many Chinese customer just want to walk-in to purchase the latest iPhone products from Apple stores, they are not willing to buy it from scalpers with the mark-up price, for the fear of getting a fake. It is also not easy to buy it online too as the Apple online store is somehow always busy with special software controlled by Chinese scalpers. Manufacturers like Samsung, HTC and Motorola that also make iPhone-class devices could win over Chinese buyers frustrated by Apple’s sales halt.

Source: Bloomberg