Focusing on the US Market

If you look at Apple’s business model, it quickly becomes apparent that its retail operations are a key part of its route to market. Wherever Apple stores open, Apple’s share of the local PC market rises. About 50% of Mac purchases in the stores are by people converting from Windows. In effect Apple’s stores are show rooms as well as retail outlets. The only country where Apple has a significant number of stores is in the US – and there is no evidence that it has saturated the US with stores. The USA is also the trend-setting market in computer technology. It gives the lead to other markets. The US market is about 29% of the global market, but that percentage is falling as the number of PC owners rises in fast developing countries like India and China.

The latest figures (4Q07) from Gartner suggest that Apple has 6.1% of the US market, whereas IDC thinks it’s 5.7% – so lets assume it’s 5.9% – and that factors up (by 25%) to 7.4%. Thus:

Apple’s Share of the US Home PC Market = 7.4%………….(III)

Market Share By Revenue

So far we have focused on unit sales. But, the average revenue that Apple gets per unit is roughly double what other vendors get. This is because Apple sells at a premium and because it does not focus on low-end models. This means that we can almost double the above percentage to show market size by revenue, to give us 14.7%.

I’m reasonably sure that this figure is accurate, because I’m not alone in suggesting a figure in that region. According to Charles Wolf, of the Wolf Bytes newsletter, Apple’s share of home PC revenue in the US is 15.8% which he maintains is almost double its share of the number of units sold. If we average his figure with mine we have:

Apple’s Share of the US Home PC Market By Revenue = 15.05%…..(IV)

It’s your choice as to how important you think this revenue figure is. I regard it as less important than the number of units. However the number of units does not tell you how much the product is being used, only how many products have been sold.

Market Share By Usage

A web site can monitor its visitors and know who is using which OS. It can also gather statistics from multiple web sites to get a more accurate picture. This is what Net Applications does, using 40,000. It’s current figures suggest that 7.57% of Internet users are using Macs. I find that an interesting figure given that Net Applications is actually monitoring sites right across the world – not just US sites.

If the Mac has just 3.2% of the global PC market currently, but 7.57% usage share then one or more of the following statements must be true:

  • Mac users replace their computers a lot less frequently (i.e. greater obsolescence in Windows PCs leads to more PC sales).
  • A significant percentage of PCs don’t access the Internet.
  • Many PCs that do access the Internet access it less frequently than Macs do.

The third of these statements is probably the main cause of the high usage figure. Net Applications also reports that the Safari market share (by usage) is 5.8% and Safari usage usually indicates a Mac (or an iPhone).

Apple’s Share of the Global PC Market By Usage = 7.57%……(V)

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