Apple iWatch will occupy the high-end smart watch market

Apple iWatch will occupy the high-end smart watch market

Apple recently dug out Patrick Pruniaux, vice president of sales and retail for the luxury watch brand haoya under Louis Vuitton ), peranius is the third senior manager Apple has dug from luxury brands in the past year. In February last July, Paul Deneve, CEO of apple, became vice president. In last October, Apple tapped Angela Ahrendts, Chief Executive Officer of berkeli, as the head of its retail business.

The recruitment of three luxury brand executives strongly suggests that the price of Apple iWatch will be much higher than that of smart watches sold in the current market. It seems risky to launch high-end products in a market that is flooded with cheap smart watches, but it is actually an effective way for iWatch to subvert the market like iPod, iPhone or iPad.

Luxury business

Apple usually turns a blind eye to the low-end market. Steve Jobs, Apple's founder and former chief executive, once compared apple to BMW and Mercedes-Benz, demonstrating that profit margins and reputation are more important than market share.

Apple's goal has always been to lead the high-end market. The iPhone 5s bare metal price is $649-849 (about RMB 3989-5219). At this price, its only competitor is Samsung Galaxy S5. According to data from comScore, a market research firm, Apple still dominated the U.S. smartphone market with a 42% market share, with Samsung only 27%.

This is why Apple released the iPhone 5c. The bare metal price for the iPhone 5c is $549-649 (about RMB 3375-3989), slightly lower than the iPhone 5S, known as the "poor iPhone" is doomed to the iPhone 5c failure fate. The problem is that Apple listened to the advice of Wall Street analysts who believed that Apple needed a low-end product to compete with cheap Android phones, rather than simply sticking to the "BMW and Mercedes" positioning that Steve Jobs set for Apple. Although it is not a completely failed product, the iPhone 5c has deviated from its goal. It is not able to attract Android users, but has eroded iPhone 5s sales.

Market research firm Forrester data shows that the average annual household income of iPhone users in the United States is $0.1052 million (about $0.6467 million ), more than 89.3 thousand USD (about 0.5489 million RMB) for Android mobile phone users ). Mac computer sales also showed the same trend. The average annual household income of Mac users was 98560 US dollars (about 605838 RMB), higher than 74452 US dollars (about 457649 RMB) of PC users ).

Given Apple's market share, its popularity among high-income households, and the cold reception of the iPhone 5c, Apple's release price is much higher than Samsung Galaxy Gear's $-(about RMB) iWatch is reasonable.

Only high prices are not enough. Consumers will not queue up to purchase smart watches that experience the same products as existing products on the market but have a high price.

MP3 players, smartphones, and tablets are not invented by Apple, but they are revolutionizing these three types of product markets. The reason is that Apple has worked hard to find out its opponent's weakness. The Apple iPod solves the problem of limited storage space for other MP3 players. The iPhone does not use hard-to-use physical keyboards and configures touch screens. The iPad converts the tablet into a large smartphone, rather than a small pen notebook.

These three products show Apple's strengths. Apple will not keep pace with existing products, but fix existing product defects and launch better products. The current smart watch industry is like this. Many companies are eager to launch products and hope to gain a place in the smart watch market.

This chaos means Apple will have the opportunity to subvert the smart watch market and seize the market with a late but outstanding product.

Why does iWatch stand out?

Currently, smart watches have three important problems: appearance, battery life, and usefulness. Apple will be able to launch products that are more fashionable than Samsung Galaxy Gear or Sony SmartWatch with a number of big names in the fashion industry. Apple's recent acquisitions and recruitment shows that it can solve the second and third problems.

Apple acquired the energy-saving LED startup company LuxVue in May, indicating that the iWatch battery life will be longer than the current smart watch. Apple recruited from Nike's FuelBand department and other medical equipment companies, indicating that iWatch will be configured with a large number of biometric sensors.

The data collected by iWatch will be compatible with Apple HealthKit, which can collect data from compatible third-party applications and wearable devices and integrate the data to the Health platform of iOS 8. Health can be connected to Epic Systems, an electronic medical record company, to provide patients with relevant information directly to doctors, making iWatch a more useful Health monitoring device than existing smart watches.

Despite these obvious advantages, Apple iWatch will face more intense competition. Android Wear released by Google will fill the market with a large number of cheap smart watches. Samsung's recently released SiMBAnd enables third parties to customize it and add health sensors. Some media reported that Microsoft is developing smart watches compatible with Android, iOS, and Windows Phone.

Of course, the smart watch market is large enough that these companies can coexist peacefully. Market research firm ON World predicts that smart watch shipments will surge from less than 4 million this year to 2018 in 0.33 billion.