Apple Inc.’s (NASDAQ:AAPL) retail stores are experiencing a period of sales “doldrums” in the absence of fresh, new, and exciting products to draw crowds of eager purchasers through their doors.
According to reports, however, this is actually a sign of robust sales of existing Apple items. The Cupertino firm now offers its signature product lines, such as the iPhone, iPad, and Mac, through so many third-party outlets that a lack of decline in Apple Store purchases actually means that consumption of these items is rising.
Physical sales numbers are down by 5% since December 2013, but revenues remain largely the same. This would seem to indicate that people are using the Apple (AAPL) retail outlets to make larger purchases than a few months ago, either upgrading to more expensive systems or buying several items rather than just one.
Powering these sales is the slow but measurable improvement of the American economy. Thanks to Federal Reserve policy and the efforts of the Obama administration, despite Congressional efforts over the past two years to hamstring the recovery for political reasons, job creation has been outpacing job loss, unemployment has fallen well below 7%, and affordable health care has been introduced in the form of the ACA to ease the burden of high premiums and serious health problems caused by lack of readily accessible, affordable preventive care.
Most importantly, consumer spending jumped in March, indicating that all these “slow-motion positives” are finally having an effect on the economic health of the average U.S. citizen. This likely explains why Apple’s retail outlet revenues have remained nearly constant despite a notable drop in overall units sold.
According to rumor, Apple’s “next big thing,” besides the much anticipated release of the iPhone 6, is likely to be the vanguard of a whole ecosystem of health related products. Though the iWatch is part of this ecosystem, it is unlikely to be the Alpha and Omega of the new product category if the rumors prove correct. Many other products could ultimately integrate medical technologies, and with Apple’s push to acquire the services of medical technology professionals, it is unlikely that a single wristwatch is the focus of all this expenditure and research.
An iMedical ecosystem (to coin an unofficial phrase to describe it) would likely be a lucrative one for Apple (AAPL) if handled correctly. People naturally want to live as long as possible, and be as healthy as possible while alive in order to better enjoy their existence. The iPhone 6 will doubtless be the first product that returns large numbers of people to Apple Stores, but the iWatch and other products will also likely boost brick-and-mortar retail sales.
