Apple’s Hip Hop Strategy Forgets Beats Headphones

By CultureBanx Team

  • Apple’s last Beats launch was the BeatsX earphones in 2016

  • Beats owns nearly 50% of the premium headphone market

Beats is arguably the world’s most iconic headphone brand. Its success was built on the popularity of hip hop culture and catapulted to new heights when Apple (AAPL +0.06%) acquired the company. There have been very few product advancements, so is Apple leaving Beats and African-American aestheticism behind?

Why This Matters: Apple needed to tap into black culture to differentiate its headphone product from the competition. The company shelled out around $3 billion to acquire Beats back in 2014. Herein lies the dilemma for Apple, even though they own Beats outright, it’s clearly in direct competition with their in-house AirPods brand.

The last major launch was the BeatsX neckband-based Bluetooth earphones back in 2016, other lines have received basic incremental updates. Despite the lack of new innovative hardware Beats is a staple among hip hop artists and athletes alike, which have helped pushed the brand to own nearly 50% of the premium headphone market, according to Statista. Not to mention, Beats is one of the main products that connects Apple to urban markets.

With the purchase of Beats the iPhone maker had access to Dr Dre and Jimmy Iovine’s music engineering team, that they used to create Apple Music. By harnessing black culture when it came time to launch its music streaming service, they were able to brake records with hip hop artists releasing songs on their platform.

In its latest quarterly earnings results, Apple reported $3.74 billion in revenue from its "other products" division, which includes sales of Beats Headphones, Airpods and more.

What’s Next: At this point it’s possible we won’t see any new Beats products from Apple by the end of the year. We may only be left with the lingering question about what the company’s long-term plans are for the Beats brand. It’s been speculated Apple will hold one more event in 2018, so be on the lookout for any Beats announcements.

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