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Apple's iOS Loyalty Rate Is Lower Than Google's Android, But Apple May Steal More Users Each Year
By: Forbes | March 10, 2018

It estimates that over the past two years Apple’s iOS loyalty rate has been 85% to 88%
Apple should gain more switchers than it loses

There are essentially two viable smartphone operating systems, Apple’s iOS and Google’s Android. Both of them have very strong loyalty rates, with Android’s a bit higher than iOS’. However, since Android has a much larger install base and sells more smartphones each year, it actually loses more to Apple than it gets from iOS. (Note that I own Apple shares).

OS loyalties are at all-time highs

Consumer Intelligence Research Partners, or CIRP, has surveyed 500 U.S. smartphone users, who have activated a new smartphone each quarter, over the past four years. It estimates that over the past two years Apple’s iOS loyalty rate has been 85% to 88% and Google’s Android loyalty has ranged from 89% to 91%.



Mike Levin, Partner and Co-Founder of CIRP said, “Loyalty for both Android and iOS increased in 2015 and into 2016, when it leveled off for both operating systems,” He added, “Loyalty is also as high as we’ve ever seen, really from 85-90% at any given point. With only two mobile operating systems at this point, it appears users now pick one, learn it, invest in apps and storage, and stick with it. Now, Apple and Google need to figure out how to sell products and services to these loyal customer bases.”

Android has better loyalty but bleeds more users than iOS

Apple sold 215.8 million iPhones in calendar 2017, and IDC estimates that there were 1.244 billion Android smartphones shipped during the year. The results below are not close to being exact, but they give an indication that more Android users defect each year vs. iPhone customers.

iOS switchers

• 86% loyalty during 2017 (therefore 14% switch)
• 215.8 million iPhones sold
• “Lost” about 30 million to Android

Android switchers

• 91% loyalty rate during 2017 (therefore 9% switch)
• 1.244 billion Android smartphones sold
• “Lost” about 112 million to iOS



Apple probably picks up more Android users than it losses

While I believe the assumptions and calculations are solid, having 112 million Android switchers seems very high since more than 50% of iPhones sold would have been to Android switchers. One reason this could be too high is that these calculations are based on U.S. users.

Katy Huberty at Morgan Stanley estimates that Apple’s iPhone retention rate in China has been about 60% over the few months. This would lead to more users leaving Apple’s ecosystem. While I haven’t seen an equivalent Android estimate from her, I suspect its loyalty rate is less than the U.S.


Toni Sacconaghi at Bernstein estimates that 36.5 million of iPhone sales in fiscal 2017 were from switchers, and he estimates this level has been between 33.5 and 37.6 million for the past three years. This would put Android’s loyalty rate around 97%.

Josh Lowitz, Partner and Co-Founder of CIRP said, “We know Android has a larger base of users than iOS, and because of that larger base, the absolute number of users that switch to iOS from Android is as large or larger than the absolute number of users that switch to Android from iOS. Looking at absolute number of users in this way tends to support claims that iOS gains more former Android users, than Android does former iOS users.”

The bottom line is that while the smartphone market is forecast to grow at low single digit rates over the next five years, Apple should gain more switchers than it loses . From a reverse perspective, having a smaller install base is a benefit as long as Apple can keep its loyalty rate close to Android's. It also means that Apple should retain its majority of the smartphone profit pool and investors should not get too worked up about the rumored iPhone X production cuts.

https://www.forbes.com/sites/chuckjones/2018/03/10/apples-ios-loyalty-rate-is-lower-than-googles-android-but-apple-may-steal-more-users-each-year/?utm_source=yahoo&utm_medium=partner&utm_campaign=yahootix&partner=yahootix&yptr=yahoo#5b8be92c68a8

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