Research from the University of Warwick suggests the rush to be among the first to own the new iPhone 5 could see consumers paying more than three times over the retail price on internet auction sites.
Warwick economist Professor Michael Waterson has published a study which monitored rocketing sales of the iPhone 4 on internet auction site eBay just after the product was launched in the UK. He is predicting that the iPhone 5 will prove more popular and consumers will once again pay well above the retail price of the phone, which is expected to be announced by Apple today (Tuesday 4th October).
Professor Waterson’s study monitored sales of the iPhone 4 on eBay for six weeks after it was launched in the UK. He found people paid between £600 and £1,500 on eBay for the handsets, which normally retailed at around £499 to £599 in stores.
Professor Waterson said: “We monitored all eBay transactions on the iPhone 4 for six weeks from 24th June last year when it became available in the UK. The extent of eBay activity on this product was extraordinary, with total transactions amounting to around £1.5m for 2,183 sales.
“For the 16GB version of the phone, 98% of sales completed at a value in excess of the listed retail price of £499. The average price was £640.35 and the maximum achieved was £1,180. For the 32GB version of the phone, 97% of the sales completed above the listed retail price of £599. The average price was £778.73 and the maximum price achieved was £1,551.”
Professor Waterson said the announcement today would reveal details of the new specifications for the iPhone 5 and possibly a date for its much-anticipated launch.
He said: “There are so many rumours about the improved specifications of the iPhone 5 and there is so much kudos attached to being one of the first people to own one of these coveted handsets. I will be extremely interested to watch the online activity around this product once it is available , I think we will see prices in some cases rising to an unprecedented level.”
Professor Waterson said the bidding frenzy for the iPhone 4 was due to a delay in getting stocks to retailers.
He added: “The product was in short supply at this time and so it's probable that demand was influenced by immediacy or ‘snob value’. We could well see a repeat of this situation for the new iPhone 5.
“It seems we are willing to pay well over the retail price for the kudos of being one of the first people to own the latest piece of technology. This study suggests technology is the one area where we are not prepared to tighten our belts in the current financial climate.”
Notes to editors
Read the working paper, ‘eBay and the demand for the iPhone 4’ by Michael Waterson and Chris Doyle
To arrange an interview with Professor Waterson call 024 7652 3427, or please contact Kelly Parkes-Harrison, Press and Communications Manager, University of Warwick, k dot e dot parkes at warwick dot ac dot uk, 02476 150868, 07824 540863