Apple HomePod sales saw a 180% boost after the launch of the HomePod mini.
The $99 HomePod mini is Apple’s main focus now after discontinuing its larger HomePod. A report from market research company Omdia shows how that decision helped Apple snipe massive market share from Amazon in the smart speaker market.
The original HomePod launched in 2018 with beam-forming technology – allowing the speaker to shape the sound to the room. Apple’s marketing for the product failed to convey the original HomePod had the audio internals of high-end equipment – so it was something of a sales flop.
Instead, Apple launched the HomePod mini, which is essentially a smart speaker. It’s $99 price point puts it right up against Google and Amazon’s smart speaker offerings. That’s a winning strategy in terms of taking market share from competitors. Sales of the HomePod increased from under one million in Q2 2020 to 2.5 million in Q2 2021. Take a look at the chart below highlighting the stark difference.
Omdia’s report says Apple’s smart speakers have continued to grow at historic rates. Apple’s market share of the US smart speaker market has increased from 9.6% in the first half of 2020 to 21% in the first half of 2021. That’s a year-over-year shipment increase of around 245%.
Omdia suggests discontinuing the much more capable HomePod may have helped drive HomePod sales success.
“The discontinuation of the original HomePod may have contributed to the spike in growth, as Apple enthusiasts rushed to buy the remaining stock,” the report reads. That may not have worked out so well for those Apple enthusiasts who installed the most recent beta version of software, though. Many users report the software update left them with bricked HomePods.
Apple’s growth in the smart speaker market comes at a time when shipments of smart devices slowed in the United States, too. Quarter-over-quarter shipments of smart speakers in Q2 2021 declined by 27%. Most of that loss is from Amazon’s Alexa platform, which declined 31% QoQ.
Household penetration in the United States is nearing 60%, which explains the slowdown. But new product designs with additional features can help spark sales – especially with new display units. Omdia says Apple may need to release a smart speaker with a display to remain competitive against Amazon and Google.
The smart speaker market is starting to reach a point of maturity. People are more likely to remain in whatever ecosystem they bought into during the frontier days – unless they’re already Apple customers.