Wal-Mart drops iPhone 5c/5s prices ahead of launch

The company offers some major discounts to lure in customers.

By Benzinga Sep 12, 2013 5:15PM

By Louis Bedigian

Hoping to gain an edge over the competition, Wal-Mart (WMT) has reduced the price of Apple's (AAPL) upcoming iPhones.

Available for pre-order this Friday, the iPhone 5c officially retails for $99 with a two-year contract. Wal-Mart will sell the 16GB model for $79. The retail giant has knocked $10 off the price of the 16GB iPhone 5s, bringing it down to $189.

According to CNET, the standard 16GB iPhone 5 can currently be purchased for $79. This deal will likely end the moment the iPhone 5c becomes available.

Wal-Mart is also selling the 8GB and 16GB iPhone 4S for 97 cents. On Monday, the retailer will reduce the price of the iPhone 4 to just $0.10. Those who purchase the three-year-old handset will also get a $100 Wal-Mart gift card.

These discounts do not apply to those who purchase an iPhone 5s or iPhone 5c without a contract.

On Saturday, Wal-Mart will reduce the price of the contract-free iPhone 5 (from $649 to $549) and the contract-free iPhone 4 (from $449 to $349). These prices are specific to Wal-Mart's Straight Talk prepaid plan.

Luring Customers Away

Best Buy (BBY), Target (TGT) and Apple's own outlets are among the top-selling retailers for iPhones. By offering the cheapest prices of any retailer, Wal-Mart is attempting to lure customers away from those stores.

This might work, but the gains could be short-lived.

When releasing a new product, Apple typically sends the largest shipments to its own retail locations. If 100 people show up at each Wal-Mart and the retailer only has 50 units to sell, half of its prospective customers are going to walk away disappointed. Next time, they might return to the Apple Store to increase their chances of scoring a new iDevice.

Wal-Mart must also deal with the challenge of customer loyalty. Some people simply prefer the Apple Store experience. Wal-Mart won't be able to persuade those customers to shift retailers unless it gives the phone away for free. Even then, some people may not budge.

At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

More from Benzinga

Sep 14, 2013 12:17PM
Funny how so much of America bags on WalMart at every opportunity, but idolizes Apple.  Apple is large, a corporate predator, contributes very little to the US job market as they manufacture their products overseas;  they pay pennies to produce iPhones, iPads, and iPods, yet charge the highest prices in the market.  Many trash WalMart for low pay and for being anti-union - yet Apple doesn't even employ Americans, and the average pay in the countries they produce their products makes our minimum wage look like a king's ransom.  But despite all this, Apple is held up as the ideal, and people line up overnight for their new product releases.  Worse, they willingly pay whatever astronomical price Apple sets, because they absolutely have to have that latest whatever it is the day it's released.  PT Barnum was right - there's a sucker born every minute.  When it comes to anything Apple produces, there will always be iDiots.
Sep 14, 2013 12:46PM
I personally sold my iPhone 4 to GameStop for $200.00 dls. I bought a Samsung Ultra from Boost Mobil, and never looked back. My contract with At&t was killing me. they kept promising that my monthly payment would drop to $80.00 dls, which never happened. my payment stayed at $200.00 to $300.00 consistently and I felt like I was buying At&t a new car. It cost me $1200.00 dls fine for stopping my contract!! OUCH! I hated being tied to the iTunes store, and wanted a micro SD card and a keyboard. yes, I am a die hard keyboard user. then I realized how much better Android is. just the Google Travel App by itself justifies the VERY low price of my phone. and now I only pay $35.00 dls a month.. plus I have a 16 Gig memory card LOADED with apps and music.. I get my text messages right on my screen. and my Calendar notifications. GREAT. I shall NEVER go back to iPhone.
Sep 14, 2013 11:03AM
folks will not "prefer the Apple Store experience" for long if Apple continues to charge that big a premium.  Apple is hurting themselves...
Sep 14, 2013 3:48PM
I did this B.S. already with upgrading phone thinking that my 4S was out dated went and paid the extra cost of up grading to the Apple IPhone 5 then after all that wasted money found the Apple 5 not to be a big improvement over the 4S. What I would like some one to do is make the Car chargers and Head phone and cable adapters for for the car to fit threw the stupid cases we buy to protect our phones. I have the 100.00 dollar case to protect my phone from water and God forbid dropping it, and my Apple home charger fits at the bottom without taking the case off, yet the car charger is to wide to fit with the case on the phone and the ear phones will not fit with the case and and card that came with my new car's these days will not fit with the case on. and if you go replace one they too are too dam wide! Why can get a man on the moon and get all he needs there? Yet hear on Earth we have lousy cell towers, have over priced crap for our phones and no one can get anything that fits the products we buy? And as far as buying another Apple IPhone, until Apple comes out with the phone they promised us with Blue Tooth streaming to our car and home radios, and the wireless charging they also promised, I say screw wasting any more money on Apple phones! I got the most memory for my Apple 5, I spent over seven hundred on it, and the return at selling it back is not even close to what I paid for it! The Apple IPhone 4S I should have kept it was like brand new stayed in it's sixty dollar case i bought for it when it was new, unless i had to take it out due to something not fitting threw the case, just as with the case for the Apple 5. I feel the Apple 5 is nothing but a poor mans version of the Apple 5 anyway, I have read nothing new that it truly does that warrants the trading in the Apple 5 for that I would or anyone one else would gain. The only true difference from the Apple 4S to the Apple 5 was more memory, and the size of the screen, so unless you do not have a home PC, there truly is not even a reason to get rid of the Apple 4S, if you have one still. I have had both, and I kid you not I wasted a ton of money upgrading thinking I was getting more for my money when the fact was the Phone carrier I have was the one making money off the deal, I would have to have my Apple 5 for 10 years to make up the money I paid just to have the Apple 5 from the Apple 4S I traded in to get the bragging rights to having a Apple 5. In my opinion seriously do not waste your money, unless you do not have a Apple phone then yes buy one now at these great lower prices, if you already have one then you should already know what I'm talking about. Wait till Apple does as it has promised, wait for the Blue Tooth, the Wireless Charging, and the added memory it said it was going to bring to the tale to make it run faster. So far Apple just came out with a crappy new phone and got everyone all hyped up for nothing!
Sep 14, 2013 3:24PM
I  wouldn't  give a $1 for a lousy Apple phone.
Sep 15, 2013 10:10AM
The only Apples I like grow on trees in Washington.
Sep 16, 2013 9:19AM
Actually, I wanted to see if this was for real. Walmart said they will not honor this because there is nothing on their website about this. The Asst Manager I spoke with this morning is claiming false advertising by MSN. 
Sep 15, 2013 1:14PM
If you need a contract it's not $79 or $189.  The price is closer to $700.
Sep 15, 2013 12:21PM
The lowest real price ?   $549,,,, you can buy two,,, for each of your kids,,, a samsung chromebook laptop,,,, for the less than this...
Sep 15, 2013 7:55AM

Thanks to all of you that gave me some answers about buying the Prepaid phone.

The phone I used was an old Smart phone from LG. Only 3G.

I will consider the Prepaid deal again.

Sep 15, 2013 8:52AM
How does the pre-paid phone at Walmart work?  Is there a contract? do you only have so many minutes?
Sep 14, 2013 9:55AM
Well there goes Apple corp. Walmart will ruin there market for sure! iphone will just become a leader for there other over priced crap!
Sep 14, 2013 10:52AM
The Straight Talk deal @ Walmart with the iphones or any smartphone does not work away from your home zip. Just took a trip from Mobile, Al. to Cleveland, Tn. and all my calls were dropped past Birmingham and on into Cleveland, Tn. In some cases there wasn't even one bar showing. So, take my word for it; you don't get much coverage/strength with Prepaid phones.
Sep 14, 2013 5:21PM
Sure i'll stand in line with the trailer trash...NOT
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