That is an objective perspective. Consumers are not objective. When shown an iPhone 4s, but told it was an iPhone 5, and asked how it was compared to the iPhone 4s
: it's way better, definitely noticeably better, it's a little thinner, looks like the screen is a little bigger, seems a little bit faster, faster, lighter, heavier, a lot lighter, a lot faster, definitely faster (this time by someone with a phone in her hand to directly compare), very nice, very updated, etc.
It doesn't matter if the actual improvements from one model to the next are small. They could make no changes at all, and consumers would still see vast improvements.