All Apple does anymore is change the sizes of their products and yet people keep buying them.
Yes, that's all they ever do
In the case of this product, yes, people are going to buy it because of its size. That's the point.
On paper, I don't think Apple got anything wrong with the SE. It's a 6S in a 4-inch body, it's going for a decent price, and it'll have better battery life than the 4.7. Even the colors give the design a fresh look.