Apple Card  First Impressions

I decided to try the Apple Card and so I signed up for one about 10 days ago. Below are some of my thoughts on it but please don’t think this is a full review of the card which I’m sure you can find in many other places, I will only focus on a few things I care about.

Getting approved

The Apple Card lines up very well with the mid-to-high credit score base, this is anything from 680 to 750 and higher. This means that Apple or in the case of the approval, Goldman Sachs, doesn’t really do anything differently than any other bank so if you have a card like the Chase Freedom, any of the non-premium Amex cards, or cards like Uber, Amazon, and Discover It, you shouldn’t have any trouble getting approved for this card. In my opinion, the mid-to-high credit score having base is the base that usually has iPhones so Apple is doing a good pick of their customer base.

Card features

So before we get to the app features, I wanted to talk about the Apple Card as a regular credit card and its features. Cashback is pretty easy to understand, albeit a bit backwards:

  • 3% only at Apple (store, iTunes, app store, and Apple.com website)
  • 2% on everything paid for using Apple Pay
  • 1% with on everything paid for with the physical Apple Card

And the above cashback is paid everyday under the term “Daily Cash” that’s deposited into your Apple Cash Card (the other one in your Wallet app). The payout happens around “end of business” day (6-7pm) for me, which might not be the case for everyone but since I’m in the same timezone as Cupertino, it might work out nicely for me.

Other than that, a couple of features I’d like to highlight:

  • No foreign transaction fees
  • No annual fees
  • No late payment fees (although Goldman Sachs will be happy to jack up your interest rate)

App powered Card

The Wallet app has come a long way since Passbook where it contained loyalty cards and boarding passes, now it contains a whole payment ecosystem! Below are some screenshots of what the UI looks like when the card as some activity on it:

Apple Pay, just like any other card
Receipt page, similar to any other card except this one shows Daily Cash
This is the main Apple Card view when you tap the card within the Wallet app, notice the vertically misaligned “Weekly Activity” and “Pay More” buttons
Weekly transaction overview, nice that it shows a weekly change in percentage as well
Payment view

So overall, the card as a nice UI but I think there is a lot of room for improvement. A lot of the logistics of the card are hidden away in the settings page which some times you’ll want to be able to access without tapping a couple of times. The main annoyance I’ve felt is that the “Pay Later” mechanism is different depending on where you enter that flow. If it’s from the main card view, it will just ask you when you want to pay later, but from the settings view, you have the ability to choose how much and how often not just when.

One very good thing Apple has done with this card which I believe is a huge credit card experience improvement is simply to show your “current balance” containing all your spending, including “pending” transactions. Because as a customer, I don’t care if my bank has not “settled” with the other parties yet, I want to know at a glance how much money I’ve spent so far. If I spent $100 today and it’s pending for 3 days, I will still be responsible for it whether it was settled today or from 3 days from now, I spent the money today! Chase is notoriously bad at this, some transactions will be pending for up to a week so your balance will go from $0.00 to whatever you did over the past week all in one day!

Color changes

Yes, the Apple Card’s colors change in the app but…I’m not sure how they will look day to day since I’m only doing 2-3 transactions at most a day so some day the card looks blue and others it looks orange. Maybe others have had a better experience with this but for me, it looks like a nice marketing gimmick.

As you can see, this is not a full review so please go somewhere else to read that but for me I just wanted to jot down these notes. I do hope it gave you a bit more context 😁

Conspicuous consumption and other thoughts on spending

I want to talk about how Conspicuous Consumption has led me to write this post, in a hypocritical state of mind if nothing else. As I posted late last night or early this morning, I am in Portland and it’s been a fun few days. I contacted a few friends to meet up and we’ve been catching up. One of my friends works at Nike and he gave us passes to get into the company store, so we went there today. 

I bought a bunch of stuff, and that’s not to brag, but instead to say it’s a bit disappointing that I did that. But hey, it was a “good deal”. 

The reason I am posting about conspicuous consumption is because this term got introduced to me while I was watching Patriot Act with Hasan Minhaj. In simple terms, it’s when people buy stuff to show off to other people. If you’d like to read more about it, check out the Wikipedia article on it.

It’s something that’s been in the back of my mind recently and I’ve been thinking about examples of where I do this and don’t even realize it. Today’s trip to the Nike store has been a big one. I bought two pairs of shoes even though I have 4 pairs at home. The ones at home are all due to reasons I use them for, one for biking and everyday wear, one for a big more comfortable walking. And two “dressy” pairs of boots. 

I see conspicuous consumption all around me but it doesn’t bother me, it gets me thinking about how it’s something that the person wearing it had thought of doing. But hey, maybe most people don’t think about it like I do, most people just buy things because they like them and they don’t give it much thought. I don’t want to judge people wearing nice things, instead, I want to understand what they’re trying to show. Is it a lack of something else that is being covered up, or are they just trying to match. I am betting it’s the latter more often than the former. 

Conspicuous consumption is not bad in itself but it can be detrimental to a society when the patterns become reproducible and destructible. Reproducible in the form of marketing, repetitive hype cycles, and large sales throughout the year. Destructive because it can lead people to spend more than they afford, it can lead to jealousy instead of intended envy which can result in negative emotions of many kinds, and it can also lead to a retail cycle that’s too short for people to feel satisfied. 

I believe this pattern will get worse a lot more before it becomes a trap people will want to avoid falling into. 

I’m often reminded about how my parents don’t really think about brands (except for cars). They don’t see the appeal in a brand name or especially a brand name over clothing if the clothing is to be worn to cover you and not to make you a walking billboard for a particular brand which you paid money to wear in the first place. 

Thoughts on the Spotify IPO

When Spotify announced their IPO awhile ago, I was surprised they were even going for an IPO because of their financials. I'm not going to make this post a deep dive into the financials of Spotify but more on a layperson's thoughts on something like this IPO.

I've used Spotify since the very first day they launched in the US, I'm a huge fan. The product has incrementally gotten better over time, so much that I'm amazed at how well the team has been able to iterate and slowly but surely move the product forward. The music discovery and radio have improved, enough to the point that I cancelled my subscription to Pandora about 6 months ago because I felt like Spotify was close enough in the suggestions that I was wasting my money on Pandora at that point.

Spotify's a good product but I'm not too keen on the business model. Software usually wins when it scales well, the initial effort is huge but over time the number of users start to match the effort and surpass it. Economies of scale work very well for software companies but I think that's not the case for Spotify.

Spotify's biggest issue right now is paying record labels. You can't have popular artists on your platform without paying big record labels. I'm thinking early on it was a side business for record labels but as CD and digital sales have gone down and streaming has become a popular option for consumers, they've started paying more attention to it, money has started rolling in. This means Spotify is at the mercy of record labels, they're going to need to renegotiate better contracts and if they can't they're going to have to pay whatever the record labels are asking. Of course, this is pretty baseless and opinionated but I'm sure it's not far off from the truth. 

As the user base grows, the amount of songs being heard grows as well, this means more money will need to be paid out to the record labels. Ignoring bandwidth and user acquisition costs, the cost of paying record labels increases as users increase and that means it's going against the phenomenon of economies of scale. It sounds to me like Spotify is getting paid by users, taking that money and paying record labels, paying operating costs, and probably not having much money left after, this might not be the best investment to make right now. 

I'm personally waiting to see how they do during their first quarter being public and then I'll decide if I should buy their stock or not. Currently, I own no Spotify stock and I am not affiliated with Spotify. These are all just opinions so please don't take it as facts or investment advice.