Will Apple Watch bring wearable tech into the mainstream?
Perhaps the biggest surprise with the debut of the new Apple Watch on Tuesday was that its brand name didn’t start with the letter "i." Most reviews gave the device high marks for raising the design bar for smartwatches. Critics pointed out that full functionality requires the device to be wirelessly tethered to an iPhone. Ultimately, however, it is consumers not critics that matter. Has Apple once again created a market where one previously didn’t exist?
As Ben Arnold, executive director, industry analyst at The NPD Group, pointed out on his company’s blog, smartwatches have largely been "products without problems to solve." According to NPD, sales of smartwatches totaled just over $130 million in the past year.
In an opinion piece on the CNN website, Jeff Yang of The Wall Street Journal cited stats that showed only two million smartwatches were purchased over the 52-weeks ending in March compared to 964 million smartphones. Those numbers, he wrote, are "the difference between a niche product and an emerging necessity."
While the Apple Watch may not rise to the level of technological or fashion necessity overnight, Katy Huberty, a Morgan Stanley analyst, told Bloomberg News that Apple may sell as many as 60 million devices in the first year.
Apple is following a familiar game plan to rule the wearable tech roost. As it has done in the past, the tech giant didn’t rush to be first to the market with its product. It is counting on superior design, brand equity and marketing muscle to drive sales past its rivals in the space.
Forrester Research, via Information Week, predicts Apple will help to legitimize smartwatches with its entry and then, in short order (2016), dominate the market. Forrester bases its optimism on Apple accomplishing the same feat with MP3 players (iPod) and smartphones (iPhone).
The Apple Watch, which will launch in early 2015, comes in three models (Watch, Sport and Edition) and two sizes (38 and 42 millimeters). The devices are made with polished or space black stainless steel, silver or space gray anodized aluminum and 18-karate rose or yellow gold cases. Apple has created 11 different bands for the Watch, including a sport band, link bracelet, leather loop, classic buckle, Milanese loop and more.
In true Apple fashion, the Watch will be priced at the top of the market with a starting point of $349. This compares to Samsung’s Gear 2 ($299.99) and Motorola’s Moto 360 ($250) and Sony’s SmartWatch 3 ($199.99).
- Apple Watch
- Apple Watch: A Smartwatch in Name Only – The NPD Group Blog
- Apple Watch: Start of a wearables revolution? – CNN
- Apple Watch Puts a Mini iPhone on Your Wrist – Strategy Analytics Blog
- Apple Made a Perfect Watch, But Needs to Decide What It’s Good For – Wired
- Apple Sticks to Premium Prices With Watch at $349 and Up – Bloomberg News
- Here’s the Apple Watch Next to All the Other Smartwatches – Bloomberg Businessweek
- Apple to Dominate Wearables Through 2016: Forrester – InformationWeek
Discussion Questions
Do you agree that smartwatches are “products without problems to solve”? Will Apple succeed in creating a mainstream market for its Watch where one previously didn’t exist?
Most of the skepticism about the Apple Watch comes from those who were also doubters about the original iPad launch. If you’ll recall, many critics thought that the tablet business was superfluous, being positioned between a smartphone and a laptop in terms of size and functionality. But history has proven the tablet (and the iPad in particular) to be a PC killer.
It’s too early to tell whether the Apple Watch will have the same kind of impact, but it’s far too early to write it off as a niche product. Apple does have a track record for creating demand for categories where the “first to market” didn’t always get it right. And it also has a pattern of starting high on its pricing (for early adapters). I don’t expect the Apple Watch to cost $349 by the time I might be ready to buy one.
I agree with all of the points in George’s piece: smart watches don’t solve a problem, Apple does have fabulous design and marketing muscle, their presence does legitimize the space, etc., but this is much more of a test product than iPhones.
At the advent of the smartphone era, phones were still purchased to make calls, with added tech features as a bonus. The same logic can be made for watches, but the incremental gain is smaller than the leap smartphones made. The biggest advantage to a watch is not needing to pull a phone out of the pocket to do mostly the same stuff.
So the key here is that the Apple Watch will only tether with an iPhone. For Apple, that’s a subtle push to get people to embrace the ecosystem and rebuff others. For consumers, that might be a push over the edge unless they are already Apple Kool-Aid drinkers.
As it has the in the past, Apple will succeed where others do not. The Apple Watch will become a fashion accessory and eventually a key device in many peoples’ lives. This is just the first iteration of the watch. Look for it to become more useful and better technologically, over time.
It’s a product with a problem to solve. The question is, is it a mass-market problem. As a health and fitness device, it’s a market, but it’s not “everyone.” Fashion? Maybe. Things you can’t already do on your smartphone (which is never out of hand)? Not so much maybe. Still what was the mass-market need for an iPad before there was one?
Let’s see. To make an Apple watch work I have to have an iPhone in my pocket. Isn’t one of the reason watches are worn less is because people use their phone as their watch? If I were to join the Apple ecosystem, I would need to buy both a phone and a watch from them. Seems to make the total investment rather high to get two devices to do what one of them did before and can still do.
Frankly, I understand the larger phone (still would have battery concerns) but the watch? Agree that they are “a product without a problem to solve.”
Smartwatches may not be a mass-market solution, but show promise as an enterprise solution. Pilot tests ongoing in Asia involving smartwatches are showing impressive results giving associates free hands to work while receiving data on their wrist watches.
For example, a doctor can have free hands while receiving a queue of patients to visit on their watch. Japan Airlines is pilot testing gate attendants using smart watches and iBeacons to inform them where to go and where they are currently assigned to work. Retailers can receive a queue of which customer to serve next on the floor, or where to work at in real-time.
There are emerging use cases for smart watches in the enterprise setting that are very promising.
First, let’s move beyond the mentality that says every initiative has to solve a “problem.” If all we did was work to solve problems we’d be even more depressed as a society than we are now, though that is hard to imagine. If we solve ALL our problems we’ll simply be caught up, a luxury we’d enjoy for about three seconds at which point we’d run into yet another problem.
Seeing greater and higher “possibilities” is far more energizing and potentially rewarding, especially if you’re the only one seeing them. As I’ve said many times in this space: problems are always about the past, possibilities are always about the future.
A smartwatch is an example of what is possible. So far so good. The problem (and this may be a function of age) is that this possibility is just too much work! I can’t read anything that small. I don’t have the patience to fiddle around just to know what time it is. I’m not so desperate as to need to be in constant contact with everyone I know and I don’t care what my pulse is—having one is good enough for me.
There will always be people who line up for stuff like this just because. Will most of us do it? I don’t think so. My sense is we’re already tired of talking about smartwatches and we’re looking around for what’s next.
Smartwatches don’t really solve any problem I have or perceive. But I do believe Apple, with its unique Apple polish magic, will create a mainstream market for its Apple Watch for a spell. Then a new technology will fashionably replace it and become the next advancement without future uses and become just another Dick Tracy watch. As my my own wristband tells me, any advanced technology is indistinguishable from magic, which in this case appears to be making money more from fashion than problem solving.
Has Apple once again created a market where one previously didn’t exist?
Will Apple Watch bring wearable tech into the mainstream?
Will Apple’s superior design, brand equity and marketing muscle drive sales past its rivals in the space?
Yes, yes and yes.
Because Apple is Apple.
I think the Apple Watch will definitely do better than any smartwatch to date. I think it would have been huge if it was ready for this holiday. Instead it will have to now build momentum early next year.
With that said, I think it will absolutely build a mainstream market. They will eventually create a less expensive model and it will take off.
Whatever—think consumer vs. the analysts. The new shopper with the money to burn and the image to maintain will have that watch as fast as they had their iPad. Smart move by Apple to play so hard on the unique assortment of bands and face styles that the Apple Watch has. That is from the true talent of designer Sir John Ive at Apple.
Fashion, in apparel and accessories, operates with little logic in today’s fast-changing fashion world. Fashion for watches, eyewear, apparel and more is increasingly personal, and the Watch will map to many peoples’ personal “brand” needs—it is the world of Millennials that will thrive on this.
Being a major watch guy, my wife asked me yesterday: “So does this mean your Rolex, TAG and all those other watches you have are no good anymore?” Apple is already getting the watch into her brain.
GO APPLE!
Apple connects with its consumers and leads markets with new technology products. It may take time as the early adopters establish the Watch as the next cool thing, but as social media creates buzz, no surprise that the market will follow.
We’ve focused on function in the Apple Watch discussion, but it’s form that concerns me more.
I can’t quite imagine wearing that hunk of plastic and carrying a smartphone too on an all day, every day basis. I have a few decent watches that I enjoy wearing. Even the cheaper one is far more sleek than this.
(By the way, the same criticism holds for other smart watches we’ve already seen from Samsung and others.)
For me, cooler apps and interfaces by Apple don’t solve this fundamental issue. You can’t optimize ugly.
My dad taught me to “make it as easy as possible to separate a man from his money.” Apple is about to do just that.
This could quite possibly be the most consumer-centric product Apple has produced to date. Not because it is a wearable, but because it will leverage actual, natural behavior. And by behavior, I mean transactions.
This is not about telling time, or even tracking your heartbeat. This is about a new node in the Apple ecosystem that will transcend the iTunes universe.
Apple Pay.
Apple Pay starts with 800 MILLION iTunes accounts. It is essentially taking “friction” out of payments. And by friction, I mean the cumbersome act of pulling your card out of your wallet and swiping.
Behavior. Approve payment? Touch your wrist, tap your phone. Easy-peasey.
The watch, phone, tablet are just facilitating purchase behavior.
More and more, as new devices (Apple Ring? Samsung belt buckle?) connect with this platform the easier it will be to spend money.
Agreed, you don’t necessarily need a problem to solve for innovation. However, we can’t ignore the fact that “demand” must exist for a product to be successful. Demand is proportional to the pain a product is addressing. In many cases the problem or pain is not clear until we introduce the product. I mean, look at computers? How many, very intelligent people thought that computers in homes will never happen back when they were first introduced?
Having said that, I’m a little skeptical about watches. It is a very personal accessory. Often times it compliments or enhances the image of the person. If you are asking people to change this, the value proposition has to be pretty strong. If you are just targeting those people that will use this as their fashion statement or if this gear is their image enhancer, fine but that market is not very big.
It really feels like the companies that are in the race just don’t want to miss out on the opportunity if it does take off like cell phones did.
There is no doubt that wireless technology will eventually be integrated into something we have on us at all times but not sure if that is the watch.
Although I don’t feel this is particular an attractive piece of gear for me, I do like that Apple jumped into it. Any time Apple gets into the game, there is a massive following of Asian companies that make the cheaper versions which eventually lead to innovations that can be used in other areas, namely embedded products.
With all the free press Apple continues to get, versus competing products, especially a good one from Samsung, I think consumers will take a bit longer to embrace the smartwatch, only because it is not yet standalone in most cases. You still have to carry a smartphone to reach full functionality. Also, I believe size matters here, in that my fat fingers and aging eyes aren’t equipped to live with all that stuff on my wrist to manage. People love the Apple brand, so that will definitely help, like it did for iPod, iPad, etc., when those product categories already existed, but were struggling until Apple came along.
I don’t agree. Smart watches could have the capability to help solve many problems and increase convenience greatly. The problem with “smart watches” has been that they have been largely gadgets with a myriad of features that were difficult to locate and impossible to operate without referring to the typical micro print manual. I haven’t had an Apple Watch in my hands, but based on Apple experience it will function intuitively and provide a great deal of delight to the owner.
The fact that Apple owners know Apple provides a delightful experience, trust the brand and tend to have more disposable income than your typical Android/Windows/Blackberry owner ensures a level of adoption well in excess of anything that has been in the market so far. I predict that more apple watches will be sold in the first week they are offered than Samsung sold since their introduction. As this watch becomes “THE FASHION STATEMENT” of 2015, people will flock to the problem to the extent that there will become a black market for them due to production not being able to keep up with demand. Accessory watch bands will become a big business. If you noticed, the bands have a very secure, but quick change feature which will lend itself to owners having multiple very high profit bands.
These people (Apple) don’t think like normal marketers. They aren’t about selling products, they are selling experiences and lifestyles. I am buying another 1,000 shares.
The Apple Watch is fashion and as such seeks to solve no problem that cannot already be solved by other means. But as a fashionable consumer product, the “solution looking for a problem” is not a legitimate criticism. In the case of the Apple Watch, the “problems” of the consumer are the same problems they face when shopping for jewelry, clothing, or any other fashionable product: Does the item make them feel better about themselves? Does it create some excitement for them? Does the item make them want to purchase the product? If it does these things for the consumer, then it has solved the problem. The fashion aspect will help to make this a successful niche product.
To make this a successful mainstream product Apple will need to add functionality to the fashion aspect of the device. If they can successfully add Pay, voice utility, etc. and alleviate the need to carry an iPhone then I think they will have cracked the code of the mass wearable market.
The Apple Watch is a MAJOR step toward the elimination of checkout “as we know it.” It will be most valuable where checkout is the greatest inconvenience and frustration for the shopper—and that’s a LOT of places, for a LOT of people.
Unless they have screwed up in the design—I SERIOUSLY doubt that—this will be another global winner.
Apple creates products we don’t know we need (or will like). There are probably some very “cool” functions on these watches we don’t know about. If anyone can make their watch mainstream, Apple can. I think there are enough Apple fans out there to get enough sales to be close to a tipping-point of popularity. Can’t wait to see these watches and all they can do.
The right way to look at this is Apple has put a stake in “wearable technology” and watch is an avatar of it. Apple has once again created platform to exploit and at this point I can only imagine the kinds of problems that the apps leveraging this platform will be able to solve. Just like 7 years back it was naive to think iPhone was just a phone—it’s a gaming device, GPS, personal assistant and the list goes on.
The design experts at Apple will take care of aesthetics and fashion aspects of the watch such that people would think twice spending hundreds of dollars on regular watches that just tell time.