New Deal, New Stores: Apple’s Plan for China


Apple (NASDAQ:AAPL) is getting aggressive with its retail presence in China, as the country’s largest wireless carrier is set to introduce the iPhone to its new 4G network next week.

Apple reached a long-awaited deal with China Mobile (NYSE:CHL) at the end of last year, which will make the iPhone available to the carrier’s 700 million subscribers. Now that the iPhone can be used on China’s top three wireless carriers, Apple is working to build its retail presence both online and with physical stores in hopes of boosting its smartphone market share in China.

Apple has announced a new retail store location that will open on Friday at China Central Mall in Beijing’s Chaoyang district, Bloomberg reports. This store brings Apple’s total number of Apple Stores in China and Hong Kong to 13, and it is the fourth Apple Store in Beijing. According to Bloomberg, Apple CEO Tim Cook said he’d like to have a total of 22 Apple Stores in China to help the company better reach what has become the world’s biggest smartphone market.

In addition to the new location in Beijing, Apple has opened an official store on Alibaba-owned Chinese online shopping site Tmall. According to a report from The Wall Street Journal, Tmall is one of China’s most popular online marketplaces.

Some believe that China may soon overtake the U.S. as the world’s biggest e-commerce market. Alibaba’s sites, Tmall and Taobao, are two of the most popular online shopping destinations in the country. Apple already operates its own online retail site in China, but the link to Tmall could help the company reach more consumers.

Even with its new partnership with China Mobile, Apple is facing some big obstacles in China. Rival Samsung Electronics (SSNLF.PK) has a dominant market share in the country already. Cheaper smartphones made by a variety of companies and running on Android are more popular there than Apple’s expensive iPhones, which are priced too high for many Chinese consumers to afford.

According to current rankings, the iPhone maker controls just a 6 percent share of the Chinese market, falling behind Samsung, Lenovo (LNVGY.PK), Yulong, and Huawei, per research firm Canalys. Apple is hoping that the China Mobile deal and the new retail options will change those numbers.

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