How businesses and brands can develop a useful IoT strategy.
Updated, March 2015
Whilst some are calling the Apple Watch a game changer, many tech observers have missed the point. The Apple Watch is a fashion accessory and it makes Apple a fashion brand. Whilst previous products from the iPod onwards have had a lifestyle element to their branding, the watch puts Apple firmly into the fashion accessory market. The industry bible, Women’s Wear Daily pointed out that Apple’s real competition is not from other tech providers such as Samsung, but the from the mid-range watch manufacturers such as Swatch and Guess. Both of these companies are developing their own products due out within the next 12 months.
Apple understand the importance of being a fashion brand. They have made significant hires from Burberry and Gap, not to mention the addition of leading designer Marc Newson. A number of fashion and watch journalists were invited to the launch event, which further demonstrates the importance of the sector to Apple.
What was the fashion industry’s reaction to the Apple Watch? Generally favourable, but not totally blown away. It’s probably best summed up by Alex Blanter from A.T. Kearney, who specialises in fashion insight:
“Everybody is still trying to figure out how to make a smartwatch a truly must-have device, rather than an interesting and curious novelty,”
An interesting take on the Apple Watch came from HSBC Research who looked at the market for the product in China. They pointed out that luxury watches are bought not to tell the time, but as a status symbol. Is the Apple Watch a sufficient status symbol for that market? They pointed out that the most significant market in this area were as gifts. On that basis, Louis Vuitton or high end sporting goods are competitors as much as watch brands. Perhaps that is Apple’s biggest challenge. Whilst smartphones are (arguably) an essential item, the Apple Watch is not. As an accessory, watches are replaced much less frequently than smartphones. Whilst there is clearly a market amongst the early adopters, does it have what it takes to compete in the higher end accessories market? Understanding the retail challenge, Apple announced that the Watch would be available in selected retailers such as Galeries Lafayette in Paris, and Selfridges luxury hall in London.
One thing that is in Apple’s favour is that they’ve created a product that has watchmaker’s credentials. The Hodinkee watch blog declared the Apple Watch to be a bona fide time-piece, from the overall design, through to the straps, the astronomy face and the rotating crown. The review makes a convincing case for the Apple Watch as a genuine watch. Following the official launch in March 2015, commentators generally agreed that the Watch meets the stylish credentials that consumers are looking for. However, the watchmakers blog pointed out after the launch, Apple will not be in the high end $17,000 Edition, but rather, from shifting a large amount of $500 mid-range watches.
It’s not just the existing watch makers – brands from Motorola to Huwei have also launched equally attractive smart pieces. This is not the first time that Apple has entered an existing market saturated with products. Aside from the brief partnership with Motorola, Apple had never launched a phone before the iPhone. However, when it comes to smartwatches, in spite of some predictions, as the tech analyst Benedict Evans points out, no one really knows the answer. The ultimate questions is whether Apple brand is sufficient to drive the large scale adoption that the company is hoping for.