According to Al Ries, the person who coined “positioning” says “by introducing a cheaper iPhone, Apple will lose its position at the high end. And conversely, it won’t sell very many inexpensive phones because of competition from Chinese and Taiwanese companies.”
What this effectively means is that Apple bit of more than they could chew, by wanting to maintain the high end smartphone market – while aiming to get a larger market share through appealing to lower income earners. According to Ries this will hurt the brand over all, by moving their positioning from a clear point where people know what to expect to an undefined brand.
Earlier this fall Apple was ranked number 1 in terms of brand value, however this could be reduced with the ambiguity surrounding the two different iPhones. Google, which ranked number 2, is the producer of Android, which is now Apples toughest competition (next to Samsung).
This, however, is only one mans opinion. There is a posibuility that the two different phones will start to dominate the market by increasing the market share significantly. And perhaps it was a smart move to use the “iPhone” brand on this new product, so lower income earners who now can afford an iPhone 5c associate them selves with the “exclusive” Apple and iPhone brand. Only time will tell.