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Sunday, 30 November 2014

Why Target, Best Buy and Wal-Mart need Apple...........

Apple may not give Black Friday discounts on its blockbuster devices, but experts say retailers like Target, Wal-Mart and Best Buy are turning to the iPad to attract customers.
Among “door-buster” widescreen TVs—many by lesser known brands—the major big box stores had generous deals on the iPad Air 2. Target TGT, +2.55%  offered the 16-gigabyte iPad Air 2 for $499 with a $140 gift card both online and in stores and Wal-Mart WMT, +3.01% offered it for $489 with a $100 gift card as pre-Black Friday discount. Best Buy BBY, +1.70% sold out online of the iPad Air 2 by simply knocking $100 off the original price. The iPad Air 2 (and Apple’s “Beats by Dr Dre Solo HD”) were the top selling items for Target online and in stores, a Target spokeswoman says. In contrast, Apple AAPL, -0.06% only offered a $50 iTunes gift card with a full-priced iPad.
Given Apple’s reluctance to offer deals, nothing gets consumers excited during the holiday season like an eye-grabbing discount on an Apple product, says Ben Arnold, industry analyst and executive director with The NPD Group, a market research company. “The iPad is becoming increasingly important to Black Friday and Cyber Monday,” he says. “Promotions like these are hard for shoppers to pass up as they combine a premium brand, a proven home run of a product and a good discount.” Indeed, he expects iPad sales to increase by 50% year-over-year during Black Friday week 2014—after sales for the iPad doubled year-over-year for the same period last year.
Retailers view the shiny iPad Air 2—the latest generation Apple tablet—as the modern equivalent of the razor, says technology consultant Jeff Kagan. In the past, retailers would rather give away the razor at cost, and make a profit on selling the refill blades on a continuing basis, he says. “In 2014, they can bring customers in to buy Apple products at a discount, and then make a profit on other purchases once the customer is there. Bottom line—you have got to get the customer in the store.” During the holidays when consumers are surrounded by discounts, they are rarely going to visit a store and only buy an iPad Air 2 (if it is still in stock, that is).
In fact, all stores pushing online discounts this week may benefit from Apple products, according data released Saturday by the “IBM Digital Analytics Benchmark,” a real-time analysis of millions of online transactions from 800 retailers. Apple iOS led the way in mobile shopping this holiday season, outpacing Google’s GOOG, +0.27%  Android operating system in sales and traffic. Apple iOS users averaged $122 per order on Black Friday versus $98 for Android users; iOS traffic accounted for over 34% of online traffic, more than double that of Android, which drove 15%, and iOS sales accounted for 22% of online sales, nearly four times that of Android, which drove just 6%.