Apple Stores Unveil New iPhone Trade-In Promotion

Source: Getty Images

Source: Getty Images

Apple (NASDAQ:AAPL) kicked off a special iPhone trade-in promotion at its retail stores on Friday that is aimed at persuading  owners of older iPhone models to upgrade to the iPhone 5S or the iPhone 5C. Various in-store promotional materials have recently been posted that encourage customers to upgrade their iPhones, including one that reads, “It’s a beautiful time for an upgrade. You may be eligible for upgrade pricing on a new iPhone. And if you bring in your old iPhone to be recycled, you could get credit toward a new one. Ask us for details.”

According to an internal company document obtained by iLounge earlier this week, Apple has boosted the trade-in values for the iPhone 4 and the iPhone 4S. Apple Stores now offer up to $99 toward a new device for an iPhone 4 and up to $199 for an iPhone 4S. As noted by 9to5Mac, Apple also emailed alerts to customers that are eligible for a trade-in. Like all in-store trade-ins, Apple’s latest promotion is being handled through its iPhone Reuse and Recycling Program that started in the U.S. last August.

For iPhone 4S owners, this means that they may be able to upgrade to an iPhone 5S for no cost. Besides outlining the new trade-in values, the document also instructed Apple Store employees to “help customers check eligibility if they haven’t done so at home” and “show customers how easy it is to upgrade – and how affordable.”

Although this trade-in promotion is primarily geared toward getting customers to upgrade their devices, it also appears to be part of Apple’s overall efforts to boost in-store iPhone sales. In the internal document that is addressed to Apple Store employees, Apple noted that, “With you, they also understand why we’re the best place to buy an iPhone.”

At an Apple Retail Store Leaders meeting in San Francisco last summer, CEO Tim Cook told attendees that various iPhone sales incentive programs would soon be unveiled that would benefit customers and Apple Store employees, according to sources cited by 9to5Mac. Cook noted that about 80 percent of iPhone sales come from sources other than the Apple Stores. On the other hand, 50 percent of iPhone repairs and replacements are done at Apple Store Genius Bars. At the meeting, Cook suggested that he would like to see those numbers more closely aligned.

Although offering an increased trade-in value for the iPhone 4 and the iPhone 4S is clearly a benefit for customers, it’s unclear if Apple’s latest promotion will be able to reverse its relatively low iPhone sales numbers at its Apple Stores. As recently pointed out in a research note from Needham & Co. analyst Charlie Wolf that was obtained by Apple Insider, iPhone sales through Apple’s retail stores have declined as the iPhone has become more widely available at various carrier stores  and electronics retailers.

“The sales performance of the Apple Stores is also hostage to the company’s distribution strategies,” wrote Wolf. “Same-store sales have also been affected by the roll-out of the iPhone to carrier stores around the globe.” However, regardless of its effect on Apple’s retail sales, the latest iPhone trade-in promotion offers a great opportunity for Apple users who want to upgrade to the latest models at little to no cost.

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