The Apple iPad
Trends and Statistics 3 November 2011
Brought to you by web and iPad publishing specialists
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The Apple iPad did to the tablet PC market what the iPhone did to the smartphone market: re-invented it Gartner.com
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Apple iPad - Trends & Statistics
Going into 2012, The Apple iPad and The Apple iPad 2 find themselves in an ever-increasing pool of competitors. The market Apple created in 2010 has since grown to become one of the key components in the technology industry, with hundreds of tablet devices now available. As a result, a notable shift has taken place in the analysis of the device’s success as a product. Where it was once examined as a standalone product, it is now more regularly judged against its competitors. While this mode of analysis has changed, statistics and trends relating to Apple’s iPad and iPad 2 still remain almost unanimously positive - Apple are on course to sell 46.7 million tablet devices this year, 4 times larger than their Android Rivals. In this third trends and statistics document, we will look at Apple’s current and projected position in the market and display that although Apple is set to face increasingly stiff competition; all signs suggest that the device will continue its tablet dominance for the foreseeable future.
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The tablet market continues to be summed up like this: the iPad and everything else. And everything else doesn’t amount to much
Cnet
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The iPad is currently untouchable as the leading tablet device In our last report , we suggested that the iPad’s most significant impact would be the creation of an industry almost overnight. At that stage of 2011, competitors were scrambling to develop and release their own devices that they hoped would rival the iPad’s supremacy. This developer battle has perhaps become the defining issue of the technology industry during the latter months of 2011. For Apple, the good news is that their market domination has persisted throughout.
According to the IDC, Apple’s tablet market share actually rose to 68.3% of the worldwide market, up from 65.7% in the first quarter. During the same period, the number of devices sold by those operating an Android system fell to 26.8% from 34.0%. Considering the number of devices using an Android operating system, Apple remains way out in front as the world’s most popular tablet device.
Current share of tablet marketplace by operating system 5%
27% 68%
Apple Android Blackberry
Source: IDC Market Intelligence
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The customer base established by the iPad appears unlikely to erode as well. According to a U.S tablet survey by Robert W. Baird, 98% of current iPad owners that are considering a second purchase are looking at another iPad. There are several factors for both the market share and customer loyalty of the iPAf, however put simply, the iPad and iPad 2 offer users the best hardware, the best software the most Apps, and now with iOS 5, the iCloud. New devices which do not have these 4 components integrated in one ecosystem will continue to suffer when compared to Apple’s devices.
Tablet Planned Purchasing Who is the manufacturer and what tablet device are you planning on buying? August 2011 100%
85% 80%
60%
40%
20%
4%
2%
1%
RIM Playbook
Motorola Xoom
0%
Apple iPad
Samsung Galaxy Tab
Source: ChangeWave Research
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Tablet devices are here to stay
Although making a significant impact on the technology industry, the tablet market in 2011 is still in its relative infancy. The ‘newness’ of these devices has prompted some detractors to label the tablet boom a passing fad, however forecasts from industry analysts predict year-on-year growth of the tablet device, with the iPad and its follow-up devices maintaining their position as industry leaders.
Tablet Sales Predictions 2010 - 2015 Device Sales (Millions)
400
300
Gartner 200
IHS 100
0
2010
2011
2012
2013
2014
2015
As the graph illustrates, both Gartner and IHS have predicted a similar trajectory for the tablet industry, with huge yearly increases leading to approximately 300 million worldwide tablet sales recorded by 2015. During this time, several notable milestones have been predicted for the industry. Research by Social Cast predicts that in 2012, more tablets will sell per year than notebook laptops, and that by 2014 one in five US consumers will own a tablet PC (currently 8 per cent of Americans own a device).
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William Power, Analyst at Robert W. Baird
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We found that tablets appear to be taking incremental dollars away from PC’s
Significantly, analysts have been quick to emphasise that the iPad will retain its position as the leading device throughout this period. Gartner forecast that of the 326 million tablets sold in 2015, Apple will sell 148m iPads. While this is a smaller share of the overall tablet market, it would remain far and away the most popular tablet device, and remarkably, the most popular operating system, with Android sales projected at 116.4 million.
Tablet Planned Purchasing Who is the manufacturer and what tablet device are you planning on buying? August 2011 100%
85% 80%
60%
40%
20%
4%
2%
1%
RIM Playbook
Motorola Xoom
0%
Apple iPad
Samsung Galaxy Tab
Source: ChangeWave Research
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iPads and tablets appear to be very conducive to deeper, more information-packed experiences Localytics
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Magazines are set for a huge sales boost on the iPad
Statistics published over the last quarter have given publishers the biggest signal yet that consumers are adopting iPad magazine reading on a considerable scale. In a survey of over 200 people, UK marketing and analytics company imano found that 69% of those surveyed regularly use their device as a magazine or newspaper reader. These consumer habits are expanded further by Gartner, who in May found that 52% of those who read magazines on the iPad actually found the experience easier than reading a print copy, while 42% said it was just as easy.
How easy do you find the iPad magazine reading experience 6%
42%
52%
Easier than the print version As easy as the print version Less easy than the print version
Source: Gartner
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It is important that publishers recognise the huge potential for the growth of this market, and the credible predictions being made about its growth. PriceWaterhouseCoopers have recently estimated that by 2015 the North American digital magazine market will be worth. This indicates massive growth of what was considered a $4million dollar market in 2010. Perhaps best emphasising the huge potential for Magazine apps currently is the New Yorker Magazine. According to statistics 20,000 people have purchased annual subscriptions at a yearly rate of $59.99 in 2011, and “several thousand� have purchased individual issues at $4.99 each. According to Conde Nast estimates, the New Yorker already has an audience of 100,000 readers on the iPad.
Representing a significant milestone for magazine publishers, Apple launched its Newsstand service for the iPad on October 12th. The new service affords newspapers and magazines a higher profile, dedicated space within iTunes and is set to act as the primary sales channel for digital magazine editions. Since its recent release, the channel has been responsible in some cases for a huge 268% Digital magazine sales increase.
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Although consumers have been using mobile technology for a while, in the last year, there has been an awakening on the corporate side
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The iPad is the dominant enterprise & consumer tablet
George Ravich, CMO at Fundtech
More and more companies are seeing the benefits of deploying tablet devices in the workplace. Although perhaps less publicised than its success as a commercial product, the iPad has already proven an essential business tool for many companies, and remains the corporate tablet device of choice.
Corporate Tablet Demand - A Comparison May 2011 vs August 2011
For those companies buying Tablets in the next quarter, who is the manufacturer of the Tablets your company is planning on buying? 100%
80%
80%
80%
60%
40%
20%
6%
7%
6%
5%
10% 4%
0%
Apple
Samsung
Dell
Motorola
8%
3%
RIM/Blackberry
Source: ChangeWave Research
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As this recent Changewave survey displays, Apple’s position as the dominant corporate tablet has not deviated over the past quarter. Significantly, this 80 per cent share is of an increasingly bigger pie. According to data by from technology research group Gartner, by 2013, 80% of businesses will support a workforce using tablets. The professional landscape most altered by the iPad is undoubtedly the mobile technology industry. While this may seem obvious, it is an interesting sector to look at as it is the forerunner for tablet usage trends that may emerge more universally in the future. For example, according to a Social Cast survey, 27.4% of mobile workers believed the tablet could replace the laptop as the mobile device of choice in the future. While this may not be set to happen immediately, it is an interesting projection from those who work with these devices the most.
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Every single organisation that is dedicated to digital should be spending the majority of their time, effort and resource optimising for smartphones and various tablets Bonin Bough head of digital at Pepsico
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The iPad is a purchasing machine
Purchases made on the iPad continue to act as a good indicator of the devices popularity, and how well they have been adopted by their user base. In the last quarter statistics have emerged to suggest that both internet browser and app purchasing has massively increased, and has the potential to grow much further.
Claire Watts, CEO of QVC
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We see [the iPad] as a key growth vehicle
Significantly for retailers, research has shown that owners of the iPad spend more money via the device than through any other platform. The Wall Street Journal has reported that, on average, PC and Laptop users buy a product 3% of the time, whereas a consumer browsing on the iPad or iPad 2 has a conversion rate of between 4-5%.
Dana Mattioli, Wall Street Journal
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Tablet owners tend to be wealthier, which gives retailers a self-selected audience of their best customers
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These estimates are reflected in the results of Imano’s survey into iPad usage, which found that 48 per cent of iPad users spent the most money through the device, while only 19 per cent said they spent most through their computer.
How easy do you find the iPad magazine reading experience
Mobile Phone 11%
Laptop 16% Computer 19%
iPad Mobile Phone Laptop Computer Cable / Internet TV Don’t Spend Money on a Device
Cable/Internet TV
iPad 48%
4%
I Don’t Spend Money on a Device
3%
Source: Gartner
The same survey found that customers are growing ever more willing to purchase apps. A third of those surveyed have paid for 20-49 apps for their device, and just over 1 in 10 have bought 50-99 Apps.
How many Apps have you paid for using your iPad
50 to 99 11%
100+ 6%
20 to 49 33%
0 to 9 26%
10 to 19 24%
Source: Imano
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Catalogue apps are flourishing on the iPad
An App format that is thriving on the iPad and the iPad 2 is the Catalogue shopping App. As we’ve already highlighted, e-commerce is proving to be hugely popular on the device. Although internet browsing might be the traditional way to shop online, many retailers are finding that a catalogue app is a perfect fit for the device. A survey from eConsultancy has found that 54.4% of UK shoppers have used a catalogue before making an online or in-store purchase this year. With an interactive catalogue App, which is tailored to mobile shopping, the route to online purchase can be reduced significantly. This has been proven by online shopping research TheFind, who have found that the conversion rate on its catalogue app is about 10% higher than on its website, and average order size is between 10% and 20% higher.
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Wall Street Journal
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Tablet users are spending three times as much time on the catalogue app than on the website
A look at YUDU’s own catalogue apps shows that users are engaging with the content and the retailer themselves. Across our catalogue apps 39.4% of users supply opt-in data that then becomes the property of the company. This data affords retailers up-to-date information about their audience demographic and can allow for better targeted advertising campaigns.
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Conclusion
Although the tablet landscape has changed dramatically throughout 2011, the iPad and the iPad 2 remain the benchmark by which all other tablet devices are judged, and if the quarter has proven anything, no device is yet to meet the lofty standards set by Apple’s devices.
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Apple delivers a superior and unified user experience across its hardware, software and services. Unless competitors can respond with a similar approach, challenges to Apple’s position will be minimal Carolina Milanesi, Gartner Research
Both the current and projected sales figures have proven that the iPad is still king in the tablet market, and will remain the key player in an industry that is set for unprecedented overall year-on-year growth up until at least 2015. But the newest threat to the iPod’s tablet dominance is perhaps the largest. Amazon’s Kindle Fire looks set to offer a unified service that rivals the iPad’s own. Amazon’s established presence as a content-delivery channel, already in possession of millions of consumer’s details, encouraged the pre-ordering of around 95,000 devices on the first day of pre-release. While this may be slightly troubling news for Apple, the larger pool of tablet devices can only be considered as a positive for digital magazine publishers. As we reported in a recent blog post, the Kindle Fire will be geared towards media consumption, and in particular, interactive colour reading experiences. It is truly exciting and encouraging for Amazon to put their name to hardware that allows for this kind of reading. Perhaps what it emphasises more than anything however is the enduring potential of the industry, and how important digital reading experiences will be in this overall growth. If Amazon’s faith is well placed, 2012 looks set to be a huge year for tablet magazine publishers and the devices they are viewed upon.
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