Premium on a Budget: Second-hand iPhones in Indonesia

Apple, as one of the major players in the global smartphone market, does not have a strong position in the market but there are unique patterns found in the iPhone market in Indonesia as the second-hand market is thriving, although the newer iPhones keep releasing annually. This research is trying to explore the uniqueness of the Indonesia market through several interviews conducted and observation. Through analysing the company’s internal capabilities and market conditions in Indonesia, it is found that despite the annual changes, Apple has preserved the older iPhone due to longer life cycle support by the company, releasing the older iPhones as ‘cheaper versions’ at discounted prices as the part of strategy to maintain the premium images of iPhones. This strategy not only meant to increase the sales of iPhones, but also to increase the consumer base of the iOS product as the iPhone was considered a gateway of the Apple software and product ecosystem. The buyer desired to have the iOS experience on a budget. However, most second-hand iPhones in Indonesia were not registered under Indonesian authorities which could potentially be blocked by the Indonesian government and buyers’ concern about the used quality product. Solutions proposed for the Indonesian market meant selling the certified refurbished iPhone that officially shipped to Indonesia as the budget iPhone options with better quality control to ensure the consumer’s peace of mind.