Thursday, 09 April 2015 16:01

Will Apple’s Watch ‘desire/interest’ result in sales?

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Apple aficionados have high expectations of Apple’s new watch. But does desire/interest equate to stellar sales?

A new report by highly respected Argus Insights titled ‘Wearables heartbeat’ (sorry only available by US$6000 subscription only) raises some interesting issues.

Argus collects consumer data and applies its algorithms to reveal insights on consumer trends. It has been remarkably accurate in interpreting social media and turning it into data that accurately reflects consumer sentiment and sales. Its strong belief is that user experience correlates to product success

Analysis of 7.8 million social conversations and 65,000 reviews from September 2014 to end of March 2015 suggests that excitement for the Apple Watch is waning in advance of product sales.

John Feland, CEO and founder, Argus Insights said, “We have seen a couple of remarkable Apple Watch spikes – when it was first introduced of course and then when it was launched with details in March – but aside from those two periods, there has not been a sustained level of consumer interest compared to Android Wear or FitBit.”

“Fitbit suffered the most after Apple’s initial announcement but dominated holiday 2014 [sales] with both their fitness bands and their first smartwatch, the Surge. Android Wear devices like the LG G R and the Moto 360 are the highest rated wearables by consumers, ahead of the Apple Watch shipping. Even Pebble, which succeeds with a fraction of the promised functions of the Apple Watch, has been gaining demand since Apple’s September reveal.”

Argus says Apple ‘watchers’ went nuts with anticipation but the hype/gloss has worn off since. What it did was call attention to the wearables market – not create a new category as iPhone, iPod and iPad justifiably did.

Argus measures three things:

  1. 1.Consumer Delight
    1. Delight metric based on research from Stanford University on Innovation Metrics
    2. Delight is calculated using ‘star’ ratings from consumer reviews, not sentiment analysis of review text
  2. 2.Buzz Volume
    1. Volume of consumer mentions related to a particular product or topic for a given time frame
  3. 3.Mindshare
    1. Validated Buzz Volume normalized for all the brands within a market segment
    2. Strongly correlates to market share and anticipates future consumer demand

Argus says the key takeaways from this research include:

  • Unlike Smartphones and Tablets, at launch, the Apple Watch is not considered a game changer by the bulk of consumers
  • Strong holiday sales by FitBit, Jawbone, Samsung, Moto, and LG mean fewer wrists for Apple to compete for
  • Requirement for iPhone to function ensures Android users won’t switch immediately
  • Pebble’s tremendous success with Time and strong demand AFTER the Apple Watch reveal in September indicate even iPhone users are looking for a simpler experience than Apple Watch promises
  • Apple’s Retail chain is not set up to sell for fashion, nor are they equipped to handle the expected high volume of returns (doesn’t fit right, didn’t match my favourite shoes etc.)

Opinion

I wrote a much-flamed article titled ‘WTF – Watch Tim Fail’ that obviously upset iFans. I was accused of being 100% Microsoft shill and of rants against hallowed Apple – sticks and stones!

This report from Argus – a respected market intelligence company with a reputation for accuracy in predicting consumer demand seems to support a number of key points in my article.

  1. Of course, Apple Watch will be successful – but it will not be anywhere near the epoch making, category defining products that iPhone, iPod, and iPad were
  2. Working only with iPhone makes the iFans happy but it will not tempt the vast number of Android, Windows or BlackBerry users and will not make them switch operating systems
  3. Samsung has had at least two iterations, and several models of smartwatch. It is probably closer to getting it right than Apple is. Apple will also face serious competition from the Swiss watch industry who will get it right and I look forward to prestige brands successfully melding the essence of a watch and technology together.
  4. How will iFans feel when their expensive Watch 1.0, is superseded by Watch 2.0, and so on.
  5. We all know that Apple goes after the premium end of the market but perhaps it has misjudged how much people will pay for what amounts to nothing more than a fancy digital ‘watch’.

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Ray Shaw

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Ray Shaw ray@im.com.au  has a passion for IT ever since building his first computer in 1980. He is a qualified journalist, hosted a consumer IT based radio program on ABC radio for 10 years, has developed world leading software for the events industry and is smart enough to no longer own a retail computer store!

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