Apple Bests Samsung at Customer Retention

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Even though Citi analysts indicated in their downgrade of Apple (NASDAQ:AAPL) that the company’s iPhone 5 production cuts were a warning signing of diminishing consumer demand, a survey conducted by Morgan Stanley and AlphaWise found that more iPhone buyers are opting for the latest model than in previous years. According to AppleInsider, this statistic suggested that more customers “than ever are willing to pay for the best device available.”

Of the 1,000 U.S. smartphone buyers questioned in the poll, 86 percent of respondents planning to buy an iPhone said they would purchase the iPhone 5, which costs $199 for the base model with a two-year contract. In the same survey a year ago, 82 percent said they would buy Apple’s latest model smartphone, the iPhone 4S.

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With interest in the iPhone 5 high, only 10 percent of the 2012 survey participants responded that they planned to buy the iPhone 4S and 4 percent said they would choose the iPhone 4. In comparison, 15 percent of respondents in 2011 said they would purchase the previous year’s model, the iPhone 4, while 3 percent said they would pick the iPhone 3GS.

As AppleInsider reported, analyst Katy Huberty “noted that the improvement in customers opting for the latest model is likely due to the fact that this year’s model is a major upgrade with a redesigned exterior, larger 4-inch display, and high-speed 4G LTE connectivity.”

The survey also showed that Apple has the best customer retention rate in the smartphone industry, with 83 percent of iPhone users stating that they planned to buy another iPhone, while last year’s result came in 10 percentage points lower. In this category, Apple beat out Samsung’s (SSNLF.PK) 63 percent retention rate for the top spot.

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