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Apple takes a slow, steady route with smartwatch sales

Fred O'Connor | April 15, 2015
Apple has deliberately taken a cautious approach to debuting its first wearable, preferring to see how people interact with the Apple Watch and ensure that the device meets the company's high quality standards instead of initially ramping up production.

Apple should want to get the watch on as many wrists as possible, with an emphasis on software developers. They're the people who can create apps that show the value in using an Apple Watch to complete tasks, he said. Right now, the watch's apps just mimic the functions found on an iPhone app.

"You still need the app that will convince people to use [the watch], especially since the phone has to be in arm's reach to use with the watch," Campbell said.

The strong sales following the Apple Watch's debut shouldn't come as a surprise given the hype and excitement around the device, he said. The wearable's success depends on whether that interest is sustainable and genuine.

If people are using their Apple Watches on a daily basis six months after purchasing it, that would show there's a true demand for the product. But if the watch ends up in a drawer with other discarded wearables, that would reflect more of a curiosity in the product, Campbell said.

Apple planned to have the watch demand exceed supply, to protect itself in case the any hardware or software components were defective, said Ryan Martin, a mobile analyst at 451 Research.

"One way to hedge that is to limit the number of units you make available right out of the gate," he said, noting that Apple has followed this pattern when releasing other devices or entering product categories.

If the Apple Watch's robust sales continue, the company may have to balance the decision to limit production with market demand, he said. A middle ground may be to make more of only the best-selling watch models while continuing to gather user feedback on the device.

 

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