Angela Ahrendts Updates Retail Employees on Apple Watch and MacBook Launch Situation

[AdonisSMU]

That's why her exuses doesn't make sense. The launch date was April 10th, the 24th is just a shipping date so they didn't let us try the product 2 weeks before launch as she says.

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So? You need some reading comprehension man.

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I read the whole post. We're talking about not being able to walk into a store and buy the Apple Watch, then you answered something about being able to walk into a store and buy other products except the Apple Watch and MacBook. So again, your answer has nothing to do with what I said.

Go quote my post please. Please quote my original post. You said

It's not a launch if I can't go to store and buy one. Apple is not a kickstarter nor Amazon, we as customers expect the ability to go to an Apple Store and buy Apple products.

I said

And you still can with the exception being the launch period for the AppleWatch and MacBook. You are crying over spilled milk.

Email Tim and see if he'll have more sympathy for you than I have because you can't buy the Apple Watch in the store. Go cry in a corner somewhere.

Hell if you want to get technical you can order a AppleWatch in the store with one of the many Macs they have in the store.

You clearly said APPLE PRODUCTS.

10million+ iPhone 6 users bought their products online along with 2million+ Apple Watch users.

 

[Keirasplace]

I think part of the backlash is because Angela Ahrendts is largely unknown to the Apple fan community in general. I think this video is only the second or third time I've heard her voice period. We've all seen Craig several times now.

Angela comes across to some, I think, as someone who thinks she's above speaking to Apple customers and fans. If that was true, it would be ironic considering that she is VP of retail. That perception, though, is largely due to the fact that she's never appeared on stage at an event even for five minutes. She would go a long way toward endearing herself to the Apple customer and fan if she would give the retail update at the next keynote, I think.

She had barely came in at Apple in September. The only other occasion to speak was in March. Maybe you'll see her more in the future. It is not like she's been there for a long time at all. She's been there for what 9 months; that's not a long time to make your mark on such a huge organisation as Apple.

 

[mikeray]

Go easy on her guys. Not everybody was blessed with Steve Job's public speaking ability. She will get better.

I already think she has a great speaking ability. She's being very frank with this info.

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Haven't you seen Angela on video before? She's very good at it. She's obviously nervous in this video though.

She is being passionate about what she says because she cares, not because she is nervous.

 

[RnSK]

Math and physics.

"Ahrendts again told employees that the Apple Watch is only available online due to global demand exceeding supply."

How can this happen in only 5 minutes...

Quite easily. It's just math and physics.

https://forums.macrumors.com/posts/21060765/

Let's just say for the sake of argument, Apple's capacity was, optimized, 2million units (which is I believe far more than actual two-week capacity considering they aren't completely built robotically...and even robots break down under stress, but I digress) but let's just say.

Let's say their advanced ordering system was able to handle a very low number for a system like this, 50,000 orders per minute. Really, really low, because I understand that most people simply cannot conceive large numbers and orders of magnitude are *right* out.

So, given these numbers, if you are the last person in the last fraction of a minute that can be processed, 49,999 people are in front of you, roughly half the number of people that attended the last Super Bowl. I believe Apple's capacity is probably closer to that amount, but lets go with our original numbers, then scale up.

So, given this best-case scenario and every person and machine was operating at peak to pull this off, Apple would have sold every watch they had out of two-thousand THOUSAND of them in...less than one hour anyway.

So say they had "only" a million...one-thousand THOUSAND of them. That's 20 minutes.

The reality is, since Apple has done this enough times, they can likely do at least 100,000 - 200,000 fully atomic transaction per minute and feed this directly into the supply chain.

Keep in mind, some of these SKUs are especially 'fiddly'...leather from these tanneries, the ridiculousness of doing large parts of the link bracelets by hand...there are constraints of math and physics and 10,000s of thousands of people at play here....so even if we look at "all things being optimal" they'd have sold everything they could have made fairly quickly...and I was being generous with that crap capacity.

But, no, let's instead not work with things like science and instead blame the VP of Retail, heheh, or cook up some crazy conspiracy.

The reality is, even doing some simple math like this, it would be pretty easy to reverse-resolve Apple's current capacity so they are going to wait until the *last possible moment they can* to tell anyone how much they can do so competitors don't have ANY advantage until the lock up the full supply chain and market segments they want.

It's just math, physics and business...and the math is the "easy" part to work out.

-K

 

[Brookzy]

Ummm...I got my Macbook on the 15th. Not sure how this was bad...came right to my door...

There are lots of counties outside the United States. And in these countries - which were 'wave one' in Angela's own words' - the new MacBook has been back ordered by one month from the moment the store went live on the 10th.

 

[aluren]

Apple should have made it so easy with the SKUs, but they complicated all this SKUs for maximum profit (thats what corporation should do), but they sacrificed user experienced.

All they have to do is this.

1. Apple Watch Sport comes default with Black fluoroelastomer
2. Apple Watch with black leather (paying premium for this anyways)
3. Apple Watch Edition with black leather.

Then buy all the color combination as extra bands.. so anyone can walk into the store and buy a watch, and get the experience of having whole watch with bands, but same time, can upsell on bands.

This would have been more logical and a more standard Apple type launch, but I guess Angela wanted to infuse her fashion/retail expertise into all this to prove her worth to Apple.

 

[RnSK]

Not sure what the US quip was for...

There are lots of counties outside the United States. And in these countries - which were 'wave one' in Angela's own words' - the new MacBook has been back ordered by one month from the moment the store went live on the 10th.

...but it doesn't matter. They can only sell what they can make. If they hand on hand less than what people wanted to buy, or could make in X amount of days, simple math. 'Maths' even someone *inside* the US can do

-K

 

[Mactendo]

This would have been more logical and a more standard Apple type launch, but I guess Angela wanted to infuse her fashion/retail expertise into all this to prove her worth to Apple.

They wanted to make these watches as unique as it's possible right from the start. All same black leather straps and same watches would be boring and looking dumb on people's hands. Many wouldn't go buy another one strap.

It doesn't mean the launch is not messy, it is. They should've probably first launch try ons and then preorders with immediate shipping.

 

[JediZenMaster]

I'm liking this new approachable apple. I don't have an issue with Angela but yet some people are acting like she murdered their new kitten.

At the end of the day it's just a computer and if you have issues with her vote with your wallet because a tiny pebble in the sea being this forum isn't going to do a thing.

I'm glad there has not been a portmanteau of launchgate or something to that effect. Meanwhile the world continues and the sky is blue

 

[bunnicula]

They wanted to make these watches as unique as it's possible right from the start. All same black leather straps and same watches would be boring and looking dumb on people's hands. Many wouldn't go buy another one strap.

It doesn't mean the launch is not messy, it is. They should've probably first launch try ons and then preorders with immediate shipping.

I do question having so many options at launch. Not saying they should all be black, but they could've done black/white/pink for sport bands, black/blue/brown (or 3 other colors) leather classic, Milanese for a metal option, and left all the other bands as separate purchases and this would have been so much simpler.

I picked classic and Milanese because the prices were the same, btw.

These styles of bands were the ones that they have the most of anyway.

 

[ghsDUDE]

She seems like a great leader. I can't believe how many people don't realize why they're launching the watch this way.

There are so many versions, colors, and sizes that Apple truly had no idea where the most demand was going to be. With the iPhone it's easier because it's a market they understand and have history with preorders from the past.

What if they loaded up on Apple Watch and didn't do as many Sport versions as needed? Looks like 85% of orders were Sport and the Space Gray option was the most popular. Cut Apple some slack during this launch.

I'm excited to get mine in May!

 

[Keirasplace]

For something that costs about 30-40 bucks to make they should have had literally 10-20+ million of them ready to go - the risks of a $400-800M initial inventory are trivial given apples cash. Im sure the margins are even better on the customizations after, so they should have dumped bazillions of these on eager customers rather than a gradual ramp.

Oh, man, you really think that this product costs $40 bucks?

The likely average marginal cost of a whole watch, band, charger, packaging (if you include all types and all sizes and only count sports band), is likely at least $200. That still leaves Apple with a more than 50% profit margin after all other costs (R&D, especially in materials, manufacturing and software is very big on this) are counted.

That would put a 10M watches at more than 2B dollars in inventory; probably 2-3 months of production. That's a big number for any company, for a unreleased product; even for Apple. That's more watches/bands that all others have produced and shipped since these things have existed in. That's not even counting the bands which will up the ASP of the watches substantially. That's not a small number, even for Apple.

The link and milanese bands are rarely sold in huge quantity like Apple ships, and as such there was probably no production capacity before. Stocking on these would be a gamble (Considering their cost to produce) for an unreleased product.


If they chose the mix badly, having this much inventory won't help. they'll still have big delays with some part of the inventory not selling for up to 6 months, while others are in short supply.

 

[Smileyboy]

I feel like it's nice of them to say.... But they should have had at least a million available to ship. Especially the SS models. Angela...... I'm not impressed!

 

[prism]

What a fake show of empathy in a poorly recorded video shot during the toilet break.

 

[Keirasplace]

This would have been more logical and a more standard Apple type launch, but I guess Angela wanted to infuse her fashion/retail expertise into all this to prove her worth to Apple.

That would be a boring, blah launch, I mean really really blah. You'd get a blah launch like others did before, which didn't work at all.

Colors have been a big part of Apple's DNA, not sure how launching all black would be "more Apple like". That makes little sense.

BTW, those bands were announced only a few months after she joined the company, so its VERY unlikely she had anything to do with the various bands and colors being offered.

They probably hired her BECAUSE they had already decided to take a more fashion oriented angle.

 

[jaykk]

T
Colors have been a big part of Apple's DNA, not sure how launching all black would be "more Apple like". That makes little sense.

My point was about simplicity, and better user experience. I have seen in all most all video reviews people switching bands from exercise to night out etc. Why can't apple include one standard band, which costs them 0.02 cents to make, and make the SKUs simple?

 

[whiteonline]

Unapologetically unapologetic.

 

[RnSK]

Why do you think they would NOT have had?

I feel like it's nice of them to say.... But they should have had at least a million available to ship. Especially the SS models. Angela...... I'm not impressed!

People act like they are the only folks in the world that want these things...like they were hoping "bad" reviews would decrease demand or something.

A million is one-thousand...THOUSAND. That's a lot of *anything*...let alone a thing that has at least 50, more likely 100 pieces. It's just...a lot. Most people have a hard time getting their heads around big numbers if it isn't a part of what they do. it is a NON-TRIVIAL PROBLEM.

If they had a million watches, they would have sold out of them in a mere 10 MINUTES @ 100,000 orders per minute. That would be if less than ONE out of every EIGHT people in just...New York City *alone* would have bought one.

Unless they'd stockpiled these things for MONTHS and MONTHS, there simply isn't any conceivable way to meet that kind of demand for *anyone*.

I wish people understood this stuff more, even a little. it would save them *so* much stress and consternation

-K

 

[iChrist]

Is this the kind of person Apple hires?

Very condescending and horrible at 'public' speaking. And that face.

Ack.

 

[forgot-username]

No one was able to try out the watch, we could only try on the watch and watch a demo loop, this is a far cry from experiencing the watch. Fiddling with a watch that is mounted on a stand and not on your wrist does not cut it. We could not experience the taptic feedback [...]

While I totally agree that not having try one BEFORE opening pre-orders was a mistake (my theory is that they were worried that FEWER people would preorder after seeing it in person) I have to ask did the ones you tried not vibrate? The demo loop includes tactic feedback so you could experience exactly that.

 

[RnSK]

Is this the kind of person Apple hires?

Very condescending and horrible at 'public' speaking. And that face.

Ack.

Um...she wasn't "public speaking" from a prepared speech. She was talking to her retail team. I didn't find it condescending at all...but I'm not mad at her because her boss can't perform miracles

As for her face...let's see yours, Sunshine

-K

 

[sunwukong]

"Ahrendts again told employees that the Apple Watch is only available online due to global demand exceeding supply."

How can this happen in only 5 minutes...

Exactly. Ok, can't absolutely predict the future, but they can get pretty close- they've been doing this awhile. New product, yes, but not that different they could not see this coming. Basically sold out in 6 minutes? I got a 42mm SS light brown leather band within 6 minutes of start and order delivery est is not until May 13-27? I mean SIX MINUTES!

IMO they should have held SOME back to have in stores, even if just a few. You can't have a launch day if no one can buy it on launch day. You can't do all online or all in store. They tried all in store with no preorders one year for iPhone and never did it again.

So now people can't do anything on launch day that they couldn't do days before and now even weeks/months after? Sorry, that is not a launch day.

 

[sualpine]

Isn't it funny how someone can be at Apple Corporate for less than a year and already be out of touch from Apple Retail?

 

[RnSK]

Because...

My point was about simplicity, and better user experience. I have seen in all most all video reviews people switching bands from exercise to night out etc. Why can't apple include one standard band, which costs them 0.02 cents to make, and make the SKUs simple?

...people like me and seemingly, a crapton more, would have been less happy

The fact that they actually had the foresight to attempt this level of customization and this level of build quality clearly signifies they understand the larger consumer market far better than anyone previously...and you

I absolutely would not have wasted money on a cookie-cutter 2¢ band or a plastic watch. No one with any taste wants such a thing.

-K

 

[pacalis]

Oh, man, you really think that this product costs $40 bucks?

The likely average marginal cost of a whole watch, band, charger, packaging (if you include all types and all sizes and only count sports band), is likely at least $200. That still leaves Apple with a more than 50% profit margin after all other costs (R&D, especially in materials, manufacturing and software is very big on this) are counted.

That would put a 10M watches at more than 2B dollars in inventory; probably 2-3 months of production. That's a big number for any company, for a unreleased product; even for Apple. That's more watches/bands that all others have produced and shipped since these things have existed in. That's not even counting the bands which will up the ASP of the watches substantially. That's not a small number, even for Apple.

The link and milanese bands are rarely sold in huge quantity like Apple ships, and as such there was probably no production capacity before. Stocking on these would be a gamble (Considering their cost to produce) for an unreleased product.

If they chose the mix badly, having this much inventory won't help. they'll still have big delays with some part of the inventory not selling for up to 6 months, while others are in short supply.

Fitbit flex is estimated at $17 on $99 retail. So if we assume Apple has similar margins (which is nuts, Apple will have better margins at retail), $40s is probably a bit low. For the sport, it's likely closer to ... $60.

Saw an estimate of the display being the most expensive component at $7, another $20 estimating labor and glass for the sport. But it doesn't really matter if it's $60, or $80 or $100 on the sport, Apple stocked over 10 million iphone 6's and they don't have these kind of margins, and thats a $200+ per unit cost. Even more so, the margins on the higher end phones will be even higher, and the accessories for this thing have to be in the 90%+ range.

And "Big number for any company" Really? They need to move $2B dollars just to have a 1% impact on revenue. Relative to the bets made on iphone, ipod etc... and given the potential upside I see in this business, I think it was obvious last month that they didn't bet big enough for their launch.