This morning Walmart cut prices for the iPhone 5C and 5S to $29 and $99, respectively. We spoke with workers around the country and found that despite the newsworthy numbers, the retailer is struggling to clear the brightly colored inventory.
At $29, the iPhone 5C is the second lowest price on the market for an iPhone (Sprint has a web offer for a free iPhone 5C with two year contract) and the lowest for the AT&T and Verizon plans. At $99, their iPhone 5S is $100 below AT&T and Verizon stores, but the same price as Best Buy. It seems like the iPhone 5C is the most dramatic change, a power move by Walmart to be the leading seller in that market.
Initially, it seemed this could be promotional pricing. However, Danit Marquardt, director of corporate communications at Walmart, told The Wire that this was a "permanent price change." She said the shift was made to benefit Walmart customers, who actively seek the lowest priced electronics. Pricing this low can also pop up for refurbished iPhones, but Walmart is selling only brand-spanking new devices.
The Wire checked in with a number of Walmart associates around the country to understand how the iPhone 5C was selling, before and after the pricing shift. The price change is not reflected online, so customers have to visit brick and mortar locations to get the best prices. However, two stores in Virginia told us that they never had the 5C to begin with. Stores in North Dakota and California reported the same dilemma.
An associate at a Walmart in New Jersey said that all of the stores received limited inventory of the 5C from the get-go. When asked why this might be, they explained that the phones just weren't selling in the Garden State. This associate also pointed out that while the functionality of the 5C was "perfect," many smart phone shoppers did not care for the style, seeking the sleekness of traditional iPhone models. Because of the bright colors, "a lot of people choose not to buy them." Store associates in other locations agreed, though it is only the first day of the price shift.
While Walmart is offering the best pricing for Verizon and AT&T iPhone 5C models, it seems like the market they cornered has limited interest. Though their 5S pricing is comparable to their competitors, they may end up getting people in the door for $29 pricing, but up-selling them to the preferred $99 5S model. If this does lead to a pick up in sales for 5C, this could clear the shelf space for iPhone 6 models, rumored to be arriving early this fall.
Either way, kudos Walmart, you've just made moves to become a larger player in the mobile sales game right before the release of the most anticipated mobile device of the year. Now if only you'd stop selling those bee-killing plants.