Burberry CEO Angela Ahrendts will join Apple in spring 2014 as its newly-created senior vice president in charge of strategy for its retail and online stores, where she will likely use her experience selling luxury clothes worldwide to help expand sales of luxury electronics in emerging markets.
"I am profoundly honored to join Apple in this newly created position next year, and very much look forward to working with the global teams to further enrich the consumer experience on and offline," Ahrendts said in a press announcement from Apple on Monday, which added Ahrendts had led Burberry through a period of global growth.
Apple on Tuesday also confirmed reports that it was hosting an event on Oct. 22 by sending invitations to media with a simple message "We still have a lot to cover," according to AllThingsD, a news site that covers the tech industry. The event will likely feature the unveiling of a new, thinner iPad and an iPad Mini that features Apple's high-quality retina display. MacPro computers will also likely be discussed.
Sales of Apple's recent product line of the iPhone highlight a challenge that Ahrendts will face when she takes control of the company's retail strategy. A poll conducted by Consumer Intelligence Research Partners in late September shows 64 percent of iPhone buyers in the U.S. opted for the new iPhone 5S instead of the 5C, which was marketed as a less-expensive model of the iPhone 5 intended for emerging markets. According to the poll cited by AllThingsD, the 5C accounted for 27 percent of iPhone sales in late September, while 9 percent of iPhone buyers purchased the iPhone 4S.
The global market share of smartphones running on Apple's iOS system was dwarfed at 16.9 percent in 2013 by the 75.3 percent of smartphones running on Android, according to a September report from the International Data Corporation (IDC) analyst firm. This is both a challenge and an opportunity for Apple's global growth, says Ramon Llamas, research manager for the mobile phones team at IDC.
Without a wireless contract the iPhone 5S costs $649, and the 5C costs $549. Ahrendts will likely use her experience selling luxury products to help sell Apple products as "an experience," rather than by slashing prices on products, Llamas says.
"The thing about emerging markets is that people are still going to want the high–end device with a bit more allure. Ahrendts has shown at Burberry that people are willing to spend for high-end things," Llamas says. "For the same price of an iPhone you can get several Android devices. But the thing is that you are buying into an experience that cuts across the iPhone, the iPod and the iPad – and should rumors be believed, the iWatch. It's selling that experience."
Apple's rumored project of an "iWatch" wearable tech device will likely not be mentioned at the upcoming event on Oct. 22, Llamas predicts.
"The time is not right," Llamas says. "The iWatch would get its own event."