A new report from Consumer Intelligence Research Group (CIRP) says it’s not entirely clear where the new iPhone 16e fits into the iPhone lineup.
On the timeline, it replaces iPhone SE, which served as the low-price, entry-level phone since its introduction in 2016. In the iPhone model lineup, it’s in an entirely different place, perhaps more comparable to the ill-fated iPhone 12 and 13 minis.
“Apple designates the new phone as one of the latest iPhone 16 models and prices it considerably higher than the old iPhone SE,” says CIRP. “Though still the lowest priced iPhone, this suggests Apple wants the iPhone 16e perceived as a lower-priced version of the latest models, rather than an absolute entry-level phone. An entry-level phone like the iPhone SE might appeal more to Android switchers or first-time smartphone buyers. The iPhone 16e target customer is not as easily identified.”
To understand the iPhone 16e challenge, the research group looked at how new iPhone models below the baseline flagship have sold in recent years. It found that while the introduction of Pro and Pro Max models has been a big success, Apple has had a difficult time selling cheaper, simpler smartphones.
Apple reintroduced iPhone SE in April 2020. Since that year, all of the models introduced below the basic numbered iPhone, account for under 20% of total sales in any quarter and have dwindled to 5% in recent quarters.
iPhone SE and mini models together grabbed 10-20% share of new iPhone sales in a given quarter. That combined share plunged in late 2022 when Apple retired the mini form factor and reintroduced the Plus version as part of the iPhone 15 lineup.
CIRP notes that Mini models were least successful. The iPhone 13 mini share hit a high of 8% in the September 2022 quarter, the quarter when the most dedicated iPhone buyers are waiting for the release of the latest models and price drops on legacy models. The iPhone 13 mini along with the iPhone 12 mini, was at 3-6% in almost all quarters before then. Apple discontinued iPhone mini models after only two years.
“In theory, Apple needs a range of models to appeal to a range of buyers with varying incomes and appetite for new features. It continues to appeal to those customers in two ways: with newly released lower-end models, and by continuing to sell older versions of the flagship models at progressively lower prices,” says CIRP. “By doing both, Apple may confuse buyers who want something other than the current premium models. Between those two strategies, Apple has had relatively greater success selling the legacy flagship iPhones, especially when compared to SE and mini models.”
Perhaps iPhone 16e finally represents a coherent strategy to serve a more price conscious and less-feature sensitive buyer, with a current model and presumed annual releases, adds the research group.
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