John Paczkowski

Recent Posts by John Paczkowski

Best Buy Is Selling Nearly as Many iPhones as Apple Itself

Apple’s move to make Best Buy an outlet for the iPhone back in 2008 is proving a wise one — lucrative, too.

Over the past few years, the retail chain has become an increasingly important outlet for Apple, extending its reach and distribution via its 1,100 stores. About 600 of them host an Apple Store-within-a-store, most of those in geographic locations that Cupertino feels are too small to support a dedicated Apple store.

And they’re selling a lot of iPhones.

Almost as many as Apple itself, according to new data from Consumer Intelligence Research Partners (CIRP).

The firm surveyed iPhone buyers in December 2011, January 2012 and February 2012, asking them where they purchased the device. And it found that retail stores accounted for 76 percent of iPhone sales; online stores, 24 percent. When the iPhone 4S first launched, retail stores and online outlets accounted for 67 percent and 33 percent of sales, respectively, largely due to online preorders.

More interesting, however, was the breakdown of the stores themselves. According to CIRP’s data, Apple sold 15 percent of all iPhones purchased in the U.S. during the period of the survey (retail, 11 percent; online, 4 percent). Meanwhile, AT&T sold 32 percent via its online and retail stores; Verizon, 30 percent — again, online and off — and Sprint, 7 percent.

And Best Buy? The big-box retailer sold 13 percent, just 2 percent shy of Apple itself. The remaining 3 percent is “Other,” which I’m told is a combination of retailers like Radio Shack and Walmart and respondents who received their iPhone as a gift and didn’t know where it was originally purchased.

So when it comes to iPhone distribution, it’s obviously the carriers that drive sales. But retail partners like Best Buy are clearly hugely important, as well. Nearly as important as the Apple Store.

“Apple Stores and the Apple Web site are tremendously productive, but they are limited by their relatively small retail footprint,” CIRP’s Josh Lowitz told AllThingsD. “There are four times as many Best Buy stores, and probably 20 times as many AT&T, Verizon, and Sprint stores, so aggressive distribution through all these channels is critical to Apple’s U.S. strategy.”


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