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NPD confirms it: Apple’s iPhone is the affluent consumer’s device in the US

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The U.S. smartphone market grew by 21 percent in 2013 and the big sales winner was Apple(s aapl) with 45 percent of the market. The NPD Group shared the annual data on Thursday, noting that the iPhone maker experienced a small boost over 2012’s U.S. market share of 44 percent. Samsung and LG also grew U.S. sales at the expense of HTC and Motorola(s goog).

iPhone 5s M7 processor

And speaking of expenses, those who can afford more of them generally bought iPhones. NPD broke out smartphone market share by consumer income levels and found that Apple rules the roost for customers with $60,000 or more in annual income.

Source: The NPD Group/Mobile Phone Track

Save for device refreshes, the real U.S. growth continues to be in the lower income segments, with those earning less than $60,000 in income accounting for 56 percent of the U.S. smartphone sales market. And sales growth for those earning less than $30,000 a year in the U.S. jumped to 31 percent in 2013 from 21 percent in 2012.

The situation could bode well for HTC, which has strung together eight quarters of slowing sales by trying to compete with both Apple and Samsung at the high end. Earlier this month, the company said it would be looking harder at the lower- to mid-range smartphone segment. I’m still leery of the company turning things around quickly however: Motorola has already introduced a fantastic low-cost phone in the $179 Moto G; Samsung too competes well in this space.

Moto G display

As for Apple, having the top overall market share in its home country is a good problem to have. And until something disruptive comes along that’s not from Apple, there’s little reason to suggest the company will have problems staying atop the market.

Even so, it’s clear that Apple is trying to branch out in other markets and segments. Getting the iPhone on China Mobile, which has more than 750 million subscribers, opens the door to potentially massive sales there. And this is the first iPhone cycle I can remember where we saw near-immediate retail discounts on the iPhone 5c and iPhone 5s, which could help boost 2014 sales for those with less disposable income.

4 Responses to “NPD confirms it: Apple’s iPhone is the affluent consumer’s device in the US”

  1. Older people make more money than young people. I think it would be interesting to see smartphone choice based on income AND age. It’s been my experience that old people buy iPhones, whereas a lot of younger people go Android. You might find that higher income young people buy Android.

    • I agree that income as a single dimension may be flawed, but just adding one more dimension is still problematical, especially if it strictly demographical.

      For example, I guess I am considered affluent (the fact that $60K is living wage for a family in some areas is for another conversation), but I am also considered older (>50) and I use Android and the decision has nothing to do with cost or age.

      There are many drivers for why people buy into Apple’s ecosystem, status symbol, ease of use, user experience, etc. and it would be better to look at it from a driver than strictly demographics because what I earn or how old I am is definitely not going to tell why I do, or do not, carry an iPhone.

    • The other segment I see is that kids have iphones. Especially when their parents have one. Totally makes sense. Share apps and music. Plus since those kids had ipod touches they totally know how to work an iphone.