Analyst: Apple Watch launch was 'botched'

[Dennison]

If Apple announced a new laser pointer it would sell over 1 million in the first day. It has nothing to do with the product...

Now that's just flat out wrong. is still a real company competing in a heated market of new mobile technology. A million people won't bend over for anything at any price. It has to be compelling, functional and of course requires a good amount of hype.

 

[Antiloop]

Now that's just flat out wrong. is still a real company competing in a heated market of new mobile technology. A million people won't bend over for anything at any price. It has to be compelling, functional and of course requires a good amount of hype.

A product does have to be compelling, functional and well designed to last in the long term and to grow a strong user base and for people to gain a sense of attachment to it. That is undoubtedly necessary for the product to be successful with the general public.

But, does Apple have a pretty large group of fans who will blindly buy a product, sight unseen, just because it is the latest and newest thing from Apple, without actually thinking of what use and value it has to them personally? Absolutely. Did they represent a big part of the initial group of people that preordered on the 10th? Most likely (we will never really know for sure though).

Look at what has been written by people in this forum in the past month in the lead up to pre-orders and the beginning of shipments. It is clear that there a lot of people who just got it because it is Apple and for no other reason. I'm not saying that is a bad thing. Apple makes some sales and people will get whatever value out of it that they ascribe to it. But blind consumerism towards Apple products is most definitely a thing.

 

[Fattytail]

A product does have to be compelling, functional and well designed to last in the long term and to grow a strong user base and for people to gain a sense of attachment to it. That is undoubtedly necessary for the product to be successful with the general public.

But, does Apple have a pretty large group of fans who will blindly buy a product, sight unseen, just because it is the latest and newest thing from Apple, without actually thinking of what use and value it has to them personally? Absolutely. Did they represent a big part of the initial group of people that preordered on the 10th? Most likely (we will never really know for sure though).

Look at what has been written by people in this forum in the past month in the lead up to pre-orders and the beginning of shipments. It is clear that there a lot of people who just got it because it is Apple and for no other reason. I'm not saying that is a bad thing. Apple makes some sales and people will get whatever value out of it that they ascribe to it. But blind consumerism towards Apple products is most definitely a thing.

And that's exactly what makes Apple the most valuable company in the world! Pretty much every product offering is a guaranteed success because of this fan base. Maybe not necessarily a success by Apple standards, but a success by any other company's.

 

[Spetsnazos]

And that's exactly what makes Apple the most valuable company in the world! Pretty much every product offering is a guaranteed success because of this fan base. Maybe not necessarily a success by Apple standards, but a success by any other company's.

correct, that was my point all along.

I'm in the Apple camp as a developer and I like the environment. SOme of their products are terrible:
New Macbook pro with 1 port
Apple TV
Macbook "Pro" 13"

 

[Antiloop]

And that's exactly what makes Apple the most valuable company in the world! Pretty much every product offering is a guaranteed success because of this fan base. Maybe not necessarily a success by Apple standards, but a success by any other company's.

I wouldn't go quite that far either. What makes Apple valuable is that everyone, from teachers to suburban moms to gym rat douche bags to hipsters to a niece or nephew and everyone in between is a potential customer for Apple. It doesn't just appeal to techno geeks. It has the potential to appeal to everyone.

Apple loyalists will always be there to spike up the numbers in the opening days and weeks of a new product. But they are a finite customer base. How a product does 3 or 6 months later (or in the case of the Apple Watch how it does during back to school and the holiday season) is ultimately a much more important indicator of its success then the initial launch period. And additionally Apple is on a different playing field then most every other company in the world. The fact that it can outsell Pebble or Samsungs watch lineup is a given. It is the traction that the Apple Watch gets in the long term that will really set it apart from everyone else.

 

[Hendu98]

I think it's all relative...

Analysts said it'd sell X
Apple predicted Y
It actually hit Z.

It doesn't matter what any of these numbers are, but if Z < X, analysts will be always be upset. X could be 300mm and Z could be 200mm, it's still not enough.

The only real measure of this success will be whether or not apple continues the product, which is the only time Y and Z comparisons will come into play. And we likely will never see those figures.

 

[albusseverus]

… analysts will be always be upset.

No truer word was ever writ.

They appear to be hopeless at what they do because they look at the wrong things. Analysts REAL job is to make money for their clients. (Drive the stock price high with ludicrous "expectations", then clients sell at the peak and buy again on the cheap.) The rest is theatre.

"Cutting expectations to 31 million." Seriously? Who could read that and not laugh until they cracked a rib? Must have taken balls to say that with a straight face. In Tim Cook's wildest dreams… Theatre? That's practically slapstick!

Indulge me a partial re-post from another discussion. (Apologies if you're read this before.)

Don't get me wrong. I really think watch will be a big deal, just not day-one. There's billions of wrists begging for a lot more than just the time on them. Doesn't have to be earth shaking. iPhone doesn't sell because it is the best smart phone in every aspect. It sells because it's the least fuss. Each owner only needs one or two features that really help them out plus a quality product that is minimum-fuss, for iPhone to be a success. The same utility will be found for watch over time.

The addiction symptoms displayed by those who can't stop wearing their watch because they'll lose credit for their "fitness circles" is deeply worrying. Typical Adobe/Kevin Lynch mentality, borrowed from the games industry, borrowed from the Gaming (gambling) Industry. If you thought you got addicted to notifications/communications on your phone, that is NOTHING compared to your health.

All we know so far is that watch is selling better than iPhone and iPad, which were both declared a failure at launch, and are now the mindshare/technological/sales leaders in their markets. watch swallowed the whole previous year's smart watch sales in a month and according to Tim Cook sales are increasing.

Expectations are just that. Unfounded and untested. Even Apple's sales deal-makers could be guilty of over-enthusiasm for a new product, yet to take hold in the general population. I don't doubt Tim Cook has realistic expectations and his sales staff worked hard to exceed them for him. Question is, does that help or hurt Apple or watch? In a year or two, all this nonsense will be forgotten and even at exorbitant prices, watch will be "the one that gets the job done with the least fuss" and be the market leader.​

 

[Michael CM1]

Dumbledore, you probably can't be more right. These things are going to start at $400 for most people, about twice as much as probably most iPhone buyers pay using subsidies through contracts. We know they're really $650 and up, but most people still don't. Back to my point. The iPad started out at $500, a little bit more for a much larger device that people knew how to use had they ever seen an iPhone. So the last two major product launches, one in a category people almost needed -- smartphones -- and another that was basically a larger version but without much product or even demand to begin with -- tablets.

So now we're at a watch. It's something nobody really needs anywhere close to a smartphone or even a tablet. It doesn't really have an app store, even to the extend the iPad did at launch. It's a category far different from either of those products, and it only works if you have one of the iPhones from the last three cycles.

Given all that, I don't know how people thought it would sell tens of millions. Maybe I believed the hype, but that's why nobody wants me running things. Apple knocked it out of the park so hard with the iPod, iPhone and iPad -- three products that basically built upon the one before -- that analysts just went lazy crazy. Hell, they again highballed Apple's iPhone numbers and Apple set another quarterly record. So if they highball those so often, you think someone would tell these analysts to just stop trying.

The product launch was kind of botched for whatever reason. There are obviously still supply chain issues for them to only recently hit Apple Stores and still a few months from hitting third party stores such as Best Buy. Since Apple seems to be happy with the numbers and doesn't seem to be indicating some sort of Surface-style "oops, they hate it," I'd say it's got at least a decent start. I don't know how 75 percent market share is somehow any sort of failure. "Yeah, you landed on Mars. But you stepped on it with your left foot first, so it just doesn't count. You have to come back to Earth and start over again for it to count." Analysts, oy.

 

[sss4r]

And then what happens next year? How does Apple make all those people upgrade? Let's say they add another 30 million watches next year between upgrades and new adopters ... That's only 60 million watches in two years. Those aren't even iPod numbers. And what if nobody else decides they need an Watch to go with their iPhone 7. Then so much for the next big thing from Apple.

A company with $80 billion in cash reserves hardly needs one niche product to be a resounding success in order for them to engineer another product.

 

[oftheheavens]

It certainly isn't a revolutionary product... After playing with it after a few days it's clear this is definitely a first gen device-- almost feels like a beta device actually. It attempts to do everything, but ends up doing nothing well.

I think Apple should've waited until they had better sensor and battery tech, and could make it a bit thinner before they released it to the public. I can't really see that many people buying this except tech nerds like myself--yet. Really disappointed in the fitness aspect of the device, impressed with the notifications though.

I don't see mass adoption until Apple Watch 3 or 4... Right now there are still too many kinks for the price.

I agreed with you up until why they should have waited. The hardware seems fine IMO, the problem is that they rushed IMO the software so that they could get in the market, and ultimately release a product that can be updated heavily over the next two or three years before slowing down (opposite of the first iPhone that had slow components). I have apple native apps that just simply never load, that isn't something they didn't know about.

But, again IMO, they gave us a powerful watch that can sustain many heavy OS updates before needing to be replaced which will in turn still give early adopters a fair deal on a watch (what causes me to think this is that there is already a video of a watch running one of the OS's and even if it was an old one that is still impressive for how small the thing is. I do still think that we will see new watches every two years (but something tells me yearly) that change form factor and add faster chips that we really don't need with the software that they allow third party to access.

again this is all imo and I'm no expert, just my guess.

 

[Ries]

So roughly 120 million iPhone 6's have been sold to date. If "only" 8.4 million or so Watches are sold..say the rest of this calendar year...how is that dismal?

Apple needs to sell 2 mio a month for suppliers to break even. Seems they promised the suppliers higher sales numbers than they are getting. Makes the "Above expectations" seem fishy.

http://www.cultofmac.com/384037/apple-watch-demand-not-enough-for-suppliers-to-break-even/

 

[Night Spring]

The hardware seems fine IMO, the problem is that they rushed IMO the software so that they could get in the market,

I do agree the software has lots of rough edges, but I don't think it's because they rushed it. There's only so much you can do with software while it's in development, even if you do lots of beta testing. You release it in the real world, and it goes into the hands of many people, several orders of magnitudes more than any beta testing group you are able to assemble. Use cases are going to pop up that never came up during beta testing. You just can't anticipate everything. If iPhone UI was smoother than the watch on release, I think that was because (1) it's easier to design an UI for a bigger screen, and (2) Jobs was the ultimate beta tester. But even Jobs would have had trouble nailing the watch software on the first go. There's so little space, it's just that much more difficult to design for it. So the software is rough, and I doubt it would have been appreciatively better if they had spent another year in developing it.