Piper Jaffray: Apple still owns GenZ

Among 9,500 U.S. teens surveyed, 83% have an iPhone, 20% an Apple Watch.

From a note to clients by analyst Michael Olson that landed on my desktop Tuesday:

Apple’s share of smartphone ownership was flat in the Fall-19 Piper Jaffray Taking Stock With Teens survey. Of >9,500 respondents, 83% have an iPhone, the highest percentage we have seen in our survey. The iPhone may have room to move higher, however, with 86% of teens anticipating their next phone to be an iPhone, tied for the highest ever in our survey (flat from Spring-19). Android was the runner up with 10%, up from 9% in the spring. The Apple Watch was the top smartwatch among teens, garnering 20% share, with the Samsung Gear next on the list at 2%. 23% of teens plan to purchase an Apple Watch in the next six months, up slightly from 22% in the spring. Overall, we view the survey data as a sign that Apple’s place as the dominant device brand among teens remains well intact.

Maintains Overweight rating and $243 price target. 

My take: This is Piper Jaffray’s 38th semi-annual Taking Stock With Teens report. Like past surveys, it seems skewed to the relatively well-heeled. These teens estimate they spend, on average, $2,400/year.

4 Comments

  1. Gregg Thurman said:

    This is significant.

    The point of McDonald’s Happy Meal was to kidnap to shopping habits of children, as they will be customers for life. The same was true with Camel cigarettes and it’s cartoonish “joe Camel” campaign. Saturday morning children’s’ TV fare commercials are all designed to create customers for life.

    Apple not only has a very large user base for its iOS products, but it established that base with the young (who are in the most important financial demographic), all of whom will be customers for life. A

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    October 8, 2019
  2. Fred Stein said:

    OMG. That is like… WOW. OMG

    Philip. When are we going to get emoticons. I mean like REALLY?

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    October 8, 2019
  3. Robert Paul Leitao said:

    This is all good. However, I’d like to see the survey questions expanded to get some insights as to where members of the GenZ cohort are getting their music (Apple Music, etc), whether or not Apple Arcade is evidencing any early appeal and what content streaming services are most popular.

    iPhones may be de rigueur and an aspirational acquisition for members of the GenZ cohort, but what are their preferences for services?

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    October 8, 2019
  4. Jerry W Doyle said:

    “… Like past surveys, it seems skewed to the relatively well-heeled.”

    The survey may be skewed to the relatively well-heeled, but I see throughout the day teenagers with iPhones who do not appear to come from “relatively well-heeled” families. It is as Gregg Thurman denoted. Much of it all is to kidnap the shopping preference of this generation, which seems to be “iPhone” as the smartphone of choice among GenZ. As Gregg T alluded to, its the “cool” factor of owning the iPhone. Once in the ecosystem then it is going to be difficult to extricate oneself.

    The other part of the survey that I find interesting is the Apple Watch was the top smartwatch among teens, garnering 20% share. Samsung Gear is next on the list at 2 percent.

    We all know the Apple Watch is a “hit!” The Watch has been a hit for years, but only now is it beginning to inculcate itself as the needed device within the populace. More and more folk are buying Apple Watches. Apple Watches are popping up everywhere. The Watch, of all Apple devices, is an “elixir.” The device grows on you. With each passing day, each passing week, each passing month until finally, one realizes that “… I can’t leave home without it!”

    The Watch is the iPhone on your wrist, and; “its looks so cool with its colored bands.”

    The folk I see wearing it more are young adults in their twenties and thirties. It’s only a matter of time before teens awake to the Watch.

    My niece gave an evening party for her daughter going off to an out-of-state university. A money tree was sitting in the middle of the gift table where folk could choose presenting a gift or hanging money. There were large bills hanging, but there also were many nice presents. I gave her a brand new Apple Watch! It wasn’t just my niece and her daughter and daughter’s friends who emitted “awes,” it also were the adults in the room. The excitement of that gift (Apple Watch) was many times more than anything opened that night, even to the point that it didn’t matter how much money was on the money tree when she was asked to count it all: “…. I’m too busy enjoying learning the features on my new Watch!”

    In summary, I believe the Apple Watch is exponentially becoming one of the fastest sought after Apple devices, and this segment of Apple’s business is going to ramp up ever higher in the coming years. That 20% figure is low! It shows much potential growth exists among this segment of society.

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    October 8, 2019

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