Apple Watch: Pc on the Wrist
APPLE WATCH: PC ON THE WRISTApple Watch is a smartwatch developed by Apple, which incorporated fitness tracking and health oriented capabilities along with integration with the iOS and other Apple products. The watch was launched with much moolah and is expected to reach 31mn sales for Apple by 2020. Looking at some of the internal and external factors, the target isn’t going to be a cakewalk given the competitors and Apple’s own strengths.Internal Analysis (SWOT):StrengthsWeaknessesLoyal Customer BaseSuperior Design and TechnologyWider Integration with Apple ProductsHistory of InnovationLimited Target SegmentNegative Customer Feedback post releaseLow Adoption of Cloud ServicesNot water resistantNew product in existing marketsImproving device speedImproving water resistanceWidening the market (initially 16 countries)Introduction of variantsLow Cost RivalsLow Customer AdoptionDemographic Changes: Demand for continuous innovationOpportunitiesThreats
External Analysis (Industry Analysis):The smartwatches are a part of the wearable technology industry. However, given that the watches aim to compete with classic premium watches (Tag Heuer, Omega etc.), it is marginally cannibalizing the watches industry segment as well. For the analysis, the focus will be on the wearable technology industry. The industry primarily features devices such as wearable cameras, Virtual Reality headsets, wrist-wear etc. The industry has grown very quickly and is expected to reach USD 51.60Bn by 2022, CAGR of 15.5% between 2016 and 2022 (Source: MarketsandMarkets.com). The growth has been anticipated based various factors namely: consumer preference for sophisticated gadgets, increasing growth prospects of next-generation displays in wearable devices, and growing popularity of Internet of Things (IoT) and connected devices. Moreover the wrist-wear products are expected to dominate the space as the key industry players are introducing products with advanced features to serve the customers’ needs of fitness and healthcare (wrist-wears can measure fitness and health measures like heartrate, calories, distance travelled, and steps). Moreover, these can be tracked and stored using the smartphones, hence further enhancing the potential growth of wrist-wears. Another analysis by CCS Insights seconds the research of MarketsandMarkets.com: A look at the wearable technology forecasts for the next five years clearly highlights the market growth and the products’ growth for the period (Image in the next page). Customers:The primary target segment for the Apple Watch are the affluent millennials, given that they are more receptive to technology and have sufficient income to endorse apple products. However, they are missing a trick here by not making it affordable for teenagers, which have been the target of its competitors like Fitbit, Moto360 etc. However, in the recent times customers have started to question the need of a smartwatch and this had led to a decline in sales of these watches. In the year 2016, the sales of Apple Watch were down 55% by July 2016 in comparison to previous years. This was despite the wider availability of the watches and introduction of new models.