If you’ve ever watched the red carpet, you’ve probably been struck with awe at many of the outfits, followed by resentment once you realize you will never be able to afford them. If not, kudos to you. Thankfully, if that is the case, there are Beats By Dre, putting this luxurious style within somewhat reasonable reach of the rest of us.
Based on a leaked email, many have predicted that Apple will unveil a new collection of Beats headphones, its most expensive acquisition to date, alongside tomorrow’s anticipated release of the iPhone 7. As a reminder, Apple bought this celebrity-saturated company in 2014.
The brand has been able to attract the masses with its bold style and feel. Within a year of its 2008 launch, Beats controlled about 57% of the high-end headphone market. That’s when Apple decided to jump in and purchase the company for $3 billion. The new iPhone release may be the perfect moment to capitalize on this trendy asset, and integrate these two brands into a more streamlined experience.
As we wrote last week, Apple will be simplifying the new iPhone, and taking out the headphone jack in favor of an all-in-one port for both charging and audio. However, if you’re someone who wants to charge your phone while listening to music, you’ll need a pair of wireless headphones. That’s where Beats may come into play.
The majority of people we asked do not own or plan to buy wireless headphones. However, we are able to see a much more dynamic story once we dig deeper.
48% of those who don’t own wireless headphones but plan to buy them at least like, if not love, Beats. This number is larger than any other experience with wireless headphones, though in fairness, the group that doesn’t like them is the highest as well. These fans are mostly women up to 24 years old, and are active Snapchat and Instagram users. Those who follow music trends and stream music are 4x as likely to love Beats, and 3x as likely to like them, respectively. Upscale restaurant diners are more than 3x as likely to love them, signaling that fans of this brand have a higher-than-average income. This is unsurprising given that their headphones average around $200-$300, and cater to an audience concerned with style and luxury.
Even though this current group of future buyers only accounts for 9% of those we asked, they can still bring a huge profit to Apple. After all, Beats headphones can cost up to $700, but cost next-to-nothing to manufacture.
Additionally, 16% of the group that does not own or plan to buy wireless headphones, which is the largest group, at least likes Beats By Dre. Though this number is not dramatic, it does provide an opportunity. Many people say that they do not own or plan to buy wireless headphones, but with the new iPhone release they may not have a choice. This group may be forced into the “I don’t own one, but plan to buy one” category. Of that category, we could see a similar percentage of people who at least like Beats By Dre, and will choose to buy them.
What does this mean?
Simply put, this could be very good news for both Apple and Beats (and by extension, Apple again). Beats has huge potential to capitalize on the larger company’s move towards wireless headphones, given that those who don’t yet own them but plan to – and will most likely need to because of the new iPhone specifications – are overwhelmingly fans of their brand. Further, these fans have a high income, and could more likely afford what Beats releases next.
Apple’s possible announcement tomorrow may not only help get others on board with the new iPhone, but also give the company a stronger advantage (even though it doesn’t seem to need it), in the luxury headphone market.