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The Apple Effect and Protective Cases

Reporter noted that 80% of buyers of the iPhone 3GS bought a case along with their new phone. Only 20% of iPhone 4 buyers did, but Apple was offering free bumper cases along with the iPhone 4 as a solution to a reported antenna issue.

This also doesn’t take into account that fact that many iOS device owners buy multiple cases. Run several hundred million iOS devices through the calculator, multiply by protective cases that typically retail for anywhere from $20 to $60 and you can see how a multibillion market is possible.

Two major risks are faced by manufacturers of iOS cases. Because so many people buy a case at the time of device purchase, there’s a tremendous rush to be the first in stores when a new iOS device is released. This, in turn, can lead manufacturers to turn to the risky strategy of basing a new case on an early stage prototype iOS device that may or may not be legitimate.

In 2011, Hard Candy Cases made headlines when it spent $50,000 on new case moulds prior to Apple’s fall iPhone event: the cases were based on a “prototype” iPhone 5, while Apple released the iPhone 4S. The case manufacturer lost 2,000 pre-orders and was stuck with moulds that were junk. It had lost the early adopter sales by having to start from scratch. As Hard Candy says on its website : “We rolled the dice. We took a gamble. No one’s more disappointed that us. It didn’t pay off…”

Source: Investorplace.com

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