Plenty of ink has been spilled about the supposed demise of Apple's iPad. Unit sales have fallen for two straight years, including a 19% plunge in Apple's recently ended 2015 fiscal year.
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However, there is still plenty of demand for iPads -- and it tends to show through most clearly during the holiday season. Sure enough, iPads appear to have been big sellers for the Black Friday shopping weekend, particularly at third-party retailers like Target .
Look beyond the Apple Store for great dealsApple typically has a very modest Black Friday sale at its own retail outlets. In order to preserve its premium brand identity and high-touch service, Apple is never interested in using big discounts to drive traffic and sales volume. This year, it went even further by not offering any discounts at the Apple Store on Black Friday.
Apple doesn't resort to Black Friday discounts to drive traffic. Image source: The Motley Fool.
Apple's legendary customer loyalty also means that the company doesn't have to worry that it will lose sales if it is underpriced by rivals on Black Friday. By contrast, mass-market retailers in the U.S. (and elsewhere) compete viciously with one another to "win" the holiday season. As a result, these big retailers are always the best place to look for Black Friday deals on Apple products.
For example, Best Buy offered $100 off the 64 GB and 128 GB versions of the iPad Mini 4 and the 16 GB and 64 GB versions of the iPad Air 2, as well as $125 off the 128 GB iPad Air 2. Sam's Club offered $150 to $175 off the higher-tier iPad Air 2 models. Wal-Mart was selling the base versions of the iPad Mini 2 and iPad Air 2 for $199 and $399, respectively -- $70 and $100 below their list prices. Staples offered discounts of $30 to $150 on iPads, with the largest markdown coming on the 64 GB iPad Air 2.
Target arguably had the best deals of all -- at least for frequent customers. Target didn't actually discount any iPads, but it offered Target gift cards ranging from $80 with the purchase of an iPad Mini 2 to $150 with the purchase of an iPad Air 2.
For most iPad versions, the gift cards that Target offered were bigger than the best discounts available at other retailers. This was a clever strategy because it led to high iPad sales on Thanksgiving and Black Friday while ensuring that those customers would be back at Target sooner rather than later.
An iPad a secondThe big Thanksgiving and Black Friday iPad discounts appear to have driven strong sales, both in stores and online.
The iPad Air 2 was a top-selling item online on Thanksgiving and Black Friday. Image source: Apple.
According to Adobe, Apple's iPad Air 2 and iPad Mini -- it didn't specify which version -- were two of the four best-selling electronics products online during the two-day Thanksgiving and Black Friday period.
Thanks to its big gift card offers, Target was probably the biggest winner from the strong demand for iPads. It began its "Black Friday" sale online early on Thanksgiving Day and then opened its stores at 6 p.m. that evening. Target says that it sold an average of an iPad a second throughout Thanksgiving Day.
If that's literally true, then Target sold 86,400 iPads on Thanksgiving. That's not too shabby for a supposedly moribund product on a single day at a single retailer that operates in a single country!
An iPad comeback is brewingLast year, Apple sold 21.4 million iPads during the holiday quarter. While that was down 18% year over year, it still represents a significant hurdle for Apple to overcome to return to growth this quarter.
However, consumers showed last week that they are still interested in buying iPads: at least if they're on sale. The apparently strong sales performance at mass retailers like Target on Thanksgiving and Black Friday suggests that a return to growth could be right around the corner.
It would be particularly impressive if Apple posts iPad unit sales growth this quarter because it did not release a new 9.7-inch iPad this year. Considering that more than 70% of iPad usage comes from 9.7-inch models, this is a significant handicap. So even if iPad sales don't break out of their slump this quarter, they probably will start growing again as soon as a new 9.7-inch model arrives.
The article A Strong Black Friday Shows That the iPad Isn't Dying originally appeared on Fool.com.
Adam Levine-Weinberg is long January 2016 $80 calls on Apple, short January 2016 $120 calls on Apple, and short January 2016 $140 calls on Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool recommends Adobe Systems. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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