Loyalty Truth

Apple is positioning itself strongly into the largest smartphone market in the world, China, this evidenced by a recent announcement of a partnership between Apple and UnionPay.

UnionPay, the largest (and only) state-approved credit and debit card payment provider in China is described as “an inter-bank transaction settlement system”. The company has a virtual lock on the Chinese e-commerce market, being effectively the gatekeeper for any company planning to offer e-commerce services in the nation.

The formation of the partnership with Apple will enable Apple users to facilitate one touch purchases by linking an Apple ID with a UnionPay card account. “The ability to buy apps and make purchases using UnionPay cards has been one of the most requested features from our customers in China,” said Eddy Cue, Apple’s SVP of Internet Software and Services.

Prior to the new-found partnership, Apple had created a large foundation with thousands of apps available for Chinese mobile customers. Without a convenient payment method however, room for growth remained thin. Cue added, “China is already our second largest market for app downloads, and now we’re providing users with an incredibly convenient way to purchase their favourite apps with just one-tap.”

Apple’s position in the Chinese market is likely to become stronger with the addition of UnionPay. Xiaomi, one of Apple’s main competitors in China, builds smartphones with a similar style to the iPhone, selling them at half the price, sometimes less. Xiaomi is pricing phones competitively in order to promote their own mobile market and services. Apple must create roots within the Chinese mobile market and continue to strengthen its position if they want to compete effectively over the long term with Xiaomi. The partnership with UnionPay is a significant step forward for Apple.