Vietnam Embraces Apple’s iPhone
The popularity of Apple’s (NASDAQ:AAPL) products in China is no secret, and the iPhone maker has made several moves to increase its presence in the country by including it in the iPhone 5S launch last September and agreeing to a well-publicized distribution deal with China Mobile (NYSE:CHL) earlier this year. However, Apple’s recently released fiscal 2014 second quarter financial results revealed that China is not the only emerging market with a communist government that is embracing the iPhone. Although it is a much smaller country than China with only tens of millions of potential customers instead of hundreds of millions, Vietnam has emerged as one of Apple’s fastest growing markets for the iPhone.
During the company’s fiscal second quarter earnings call, Apple CEO Tim Cook pointed out that sales in Vietnam more than doubled over the past quarter, increasing by 262 percent. In comparison, iPhone sales in China grew by 28 percent. “We’ve been working at China for a while and have learned a lot and I’m very proud of what we’ve done there,” stated Cook during the earnings call according to Seeking Alpha. “But I think some of these other numbers I just read demonstrates that we’re beginning to have really nice success outside of there as well.”
The sales numbers for Vietnam are even more impressive when the fiscal first quarter is included. As noted by Reuters, Apple sales in Vietnam have tripled in the Cupertino-based company’s fiscal first half. This gives the Southeast Asian country a growth rate five times faster than India’s.
However, as noted by Cook, Vietnam is not the only emerging market to embrace the iPhone. “[Apple] had the largest total sales of iPhone in the BRIC [Brazil, Russia, India, China] countries that we’ve ever seen in our history,” said Cook, according to an earnings call transcript provided by Seeking Alpha. “And so we feel very good about that the strength was broad-based.”
Interestingly, Apple has had strong sales in Vietnam despite the country’s slow economic growth. According to statistics cited by Reuters, the country’s economy only grew by 5.4 percent last year; a growth rate that most economists feel is sluggish. Despite Vietnam’s slack growth, young consumers are flocking to Apple’s premium products. Smartphones made by Apple and other companies aren’t the only consumer electronics products flying off shelves in Vietnam. According to market research firm GfK data cited by Reuters, tablet sales in Vietnam jumped 250 percent last year.
However, the popularity of Apple’s iPhone has also led to the emergence of a thriving knock-off market. Like the copycat versions of Apple’s iPhones made by Chinese manufacturer GooPhone, Vietnam has also seen its share of fake iPhones. According to Reuters, imitation iPhones retail for around $95 in Vietnam.
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