One of Apple’s main strategies for growth over the last few years has been a shift to services and subscription models.
The segment has been its fastest-growing since 2015 and its second-most lucrative sector behind the iPhone, which generates around $40 billion every quarter. Services and subscriptions brought in close to $20 billion in Q2 revenues and grew at 17% YoY.
But why exactly?
Apple releases new versions of its main products every year with improved performance, design innovations, and new features, but critics often feel like there’s a diminishing marginal utility to the constant updates, restraining the addressable market for the company YoY.
In its latest report, Apple tallied 860 million paid subscriptions for its platforms (Apple Music, Apple TV+, Fitness+, iCloud, AppleCare, Arcade, etc.). At that number, Apple would have to at least double subscriptions to tie the current iPhone’s revenue share.
To dominate the subscriptions business, you first have to dominate the attention business — or at least that’s what Apple thinks. And that’s where sports come in.
Recently, Apple has taken strategic steps to expand its paid subscriptions with the help of the sports industry through diverse efforts within media, music, fitness, and original content.
Apple sees sports as more than just a way to broaden its subscription environment. Sports are a logical extension of the brand, message, fundamental values, and standard of experiences it aspires to deliver.
Apple will have a stronger chance of success at bringing on — and more crucially, keeping — new customers if it deliberately targets the segments, partnerships, and products that most correspond with the brand. All signs point to a long-term commitment.
Want to learn more? Check out the full Apple report here.