Apple’s Aggressive Pricing Strategy on Alibaba’s Tmall Apple’s Aggressive Pricing Strategy on Alibaba’s Tmall

Written By Michael Gary Scott

Apple Inc AAPL has slashed prices on the iPhone 16 by up to 1,600 yuan ($225) on its Alibaba Group Holding’s
BABA Tmall store to drive sales during Singles’ Day.

Commencing Monday evening, Apple unveiled a 500-yuan voucher for all iPhone 16 models, with the base iPhone 16 and iPhone 16 Pro Max now priced at 5,499 yuan and 9,499 yuan, respectively, reports SCMP.

These price reductions reflect Apple’s response to the subdued initial reception of the iPhone 16 on Chinese social media platforms.

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The discounting can be attributed in part to Apple Intelligence’s on-device AI system not supporting Chinese until next year.

Tmall has also introduced a trade-in subsidy of up to 1,100 yuan, enabling customers to save as much as 1,600 yuan on iPhone 16 purchases. JD.com Inc JD announced a similar discount, providing a free AppleCare+ subscription for the iPhone 16’s base and Plus models. PDD Holdings Inc PDD Pinduoduo further reduced prices, offering the 256GB iPhone 16 Pro Max at 9,199 yuan.

Embracing the success of its 5G resurgence, Huawei Technologies Co surpassed Apple in mainland smartphone sales in August for the first time in 46 months, according to SCMP citing CINNO Research.

Earlier reports indicated that Pinduoduo and Taobao were cutting prices on the iPhone 16 series even before its official launch due to its deficiency in AI features.

Pinduoduo initiated sales of the iPhone 16 Plus with 512 gigabytes of storage at a 10% markdown and the 128GB iPhone 16 at an 11% discount. Both Pinduoduo and Taobao marketplace have applied a 4% reduction on the 256GB version of the premium iPhone 16 Pro Max.

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Needham analyst Laura Martin anticipates the iPhone to account for 89%-96% of Apple’s fiscal 2025 revenue.

Apple stock has surged by 37% in the past 12 months. Investors can access the stock through Vanguard Information Tech ETF VGT and iShares
Russell 1000 Growth ETF
IWF.

Price Action: AAPL stock is down 0.99% at $234.13 as of the latest check on Tuesday.