Apple Watch Revenue Will Likely Be Dominated by Expensive Gold Edition

[technosix]

It seems that consumers should be leasing Apple Watches, not buying them. A luxury watch may be cheaper than a luxury car, but the same economics are true: If you want to upgrade to each new model, you spend less money by leasing.

I hadn't considered the lease option but I think you're on to something here. Given the likely demand for Apple watch, some will naturally want it right away as opposed to waiting for ver 2.0

If a lease program was structured so that it benefitted both buyer and seller the potential response could be stunning. Executed properly the program in itself could drive a very high volume of sales.

 

[Gameboy70]

$249 entry level and i'd be in line on launch day. $349...it's just above my instant-buy threshold. I have to think about it.

Has Apple ever introduced a new product within the general public's instant-buy threshold? Every new product I've seen announced from Apple invariably elicits a chorus of commentary amounting to, "X would be successful if it were priced [announced price minus $100-200]."

Apple charges what people are willing to pay, not what they say they're willing to pay. If the aWatch turns out to be a bad product, then even $249 is overpriced.

 

[hlfway2anywhere]

Has Apple ever introduced a new product within the general public's instant-buy threshold? Every new product I've seen announced from Apple invariably elicits a chorus of commentary amounting to, "X would be successful if it were priced [announced price minus $100-200]."

Apple charges what people are willing to pay, not what they say they're willing to pay. If the aWatch turns out to be a bad product, then even $249 is overpriced.

AppleTV at $99. iPad at $499. I'd say those were "instant buy" prices for products of their category at the time of release. The AppleTV at least.

 

[Keirasplace]

AppleTV at $99. iPad at $499. I'd say those were "instant buy" prices for products of their category at the time of release. The AppleTV at least.

Yet, the Apple TV by all measure is one of their least popular products (took years to make a decent amount of money). So, seems the product was not compelling enough and shouldnT even have been released in the form it was.

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I agree, based on it's assumed functions. However, it's part of the "Platform."
Apple, IMO, has just successfully completed the transition from a Device Co. to a Platform Co. There is too much focus on what each device can or cannot do.

"The Assimilation is Accelerating." All the product needs to do is be part of the "Ecosystem."

Unstoppable now. For better or worse.

Its the network effect, same thing as happens in social media. One product alone has much less value than if he works with many other products and services.

 

[Gameboy70]

AppleTV at $99. iPad at $499. I'd say those were "instant buy" prices for products of their category at the time of release. The AppleTV at least.

AppleTV at launch was $299. The reception to the iPad announcement was lukewarm, and there were a ton of gripes about the price (though, in fairness, some pundits expected it to be $700-800).

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Does anyone else hate the name Edition? The Apple Watch Edition sounds like it's the Watch edition of the Apple.

I don't know anyone who likes it. It always sounds like a word is missing.

 

[Gameboy70]

Of course it depends on the model, not 100% of Rolex's go up in price, but my point is, if the Gold Watch is $4000, it's better spent on a high end watch, like a Rolex, and opt for a cheaper Apple Watch. I wasn't saying one shouldn't buy any Apple watch because of a lack of appreciation.

Of course there will be the wealthy who just don't care and want to flaunt their bling in full gold at 4K.

People buy expensive watches because (1) they really, really like watches, and (2) because they can afford them. Fine watches are usually not purchased as "investments". Visit a watch forum sometime and see how rarely the topic of resale value comes up.

I dealt with customers every day who typically owned several watches ranging from $8k to $30k+. If I hadn't had that experience, I'd probably agree with most of the commenters in tech forums, shocked that anyone would spend thousands of dollars on a watch, especially one that obsolesces in short order.

Think of it this way: for anyone with a six-figure salary, the Edition will cost about a week's earnings. How many of us peons in the five-figure set call each other out for spending a week's earnings on an iPhone every year or two? Few of us ask, "Will the iPhone 6 stand the test of time?", or "Is it really rational to spend hundreds of dollars upgrading from an iPhone 5?" No. Most of us just buy it without much reflection, and are happy with the purchase.

I expect the one-percenters with money to drop on the Edition, assuming they think it looks nice, will just buy one this year—without the emotional handwringing we see in tech forums—then buy another one in a few years. Any demographic that buys summer homes and weekend cars has much lower purchase thresholds than worker bees like you and me.

 

[Gameboy70]

A pretty persuasive prediction of $10k: http://grail-watch.com/2015/02/16/gold-apple-watch-edition-must-cost-10000/

 

[mrhick01]

I took my 7 year old MacBook Pro to the Genius Bar to replace a bad mother board; the tech informed me Apple stops repairing their products approximately five years after manufacturing of the model has been discontinued.

What is the value going to be of a $4000 gold Apple watch seven years from now when it now longer works and the parts aren't available to repair it? The "melt" value of the case, in my opinion....

Your Macbook Pro isn't made of gold or rose gold.

There's cheap LCD watches that are 30 years old or more that still work.

 

[dexterbell]

I predict two things. Thousands of Asians lined up on opening day to buy these and send them to China and make a massive profit, and people showing these off getting robbed left and right.

 

[Michael73]

What if, just suppose what if, at that $4000 price Apple offers to replace the internals over the next few upgrades as part of the price. Now your gold watch is good for a decade or so. Do you buy one then?

I know it's still expensive, and this sounds far fetched, but Apple is known to shake up the market and a complimentary upgrade would definitely do that (and kill a few of the nay-sayers agruments.)

This isn't going to happen. However a thought occurred to me the other day...if Apple is willing to sell future watches without bands and they're made to be interchangeable, then it's worth it.

So, what you're really buying is two separate items, a (very expensive) band and a tiny wrist computer. Every year or two spend $500 to upgrade the computer bit and add the original gold band to it. I could see that happening, easily.

 

[loon3y]

lol $4,000 on a piece of technology thats going to be obsolete in a year.


how bad are these guys going to feel when the 2nd or 3rd generation is going to come out?


but i presume its only going to be the wealthy that can spend money on crap like that. Similar to how the wealthy travel first class ($10 grand for international)

Having the apple watch 4K edition dominate sales is NOT apple's goal. That would mean regular sales would be down and the common consumer isn't getting this watch.

4 Grand on a piece of technology that is literally going to be obsolete? Yeah those are like those crappy Gold smart phones or flip phones the wealthy bought for 4-6 grand a piece years ago.


No this apple watch isn't "Jewelry", a Rolex doesnt lose more then half its value when a new model or edition rolls out.

The apple watch is technology, not a "Watch" like people say here.


LOL at seeing the apple watch 1st generation Gold edition literally go obsolete when the 2nd or 3rd gen comes stand alone with their own OS.

 

[Doctor Q]

The high-end models are absolutely perfect for the gift bags that Academy Award nominees in major categories get every year. Vanity items that nobody really needs, but ensure that everyone else is looking your way.

 

[gnasher729]

Ferrari only makes 7000 cars a year too. A bit more exclusive.

If you want exclusive: Jaguar has been building six more of the "lightweight" version of the E-model.

18 chassis numbers were allocated in 1963, but only twelve were built (11 are still in existence). They are now building the six remaining ones, identical to the 1963 ones except where changes are needed to make the cars road legal.

For exclusivity, as far as the USA is concerned, google for "Bill Gates Porsche 959".

 

[AppleScruff1]

If you want exclusive: Jaguar has been building six more of the "lightweight" version of the E-model.

18 chassis numbers were allocated in 1963, but only twelve were built (11 are still in existence). They are now building the six remaining ones, identical to the 1963 ones except where changes are needed to make the cars road legal.

For exclusivity, as far as the USA is concerned, google for "Bill Gates Porsche 959".

I was speaking of production automobiles, not custom one of's etc.

 

[bushman4]

It's going to be interesting to see what price Apple will charge and what features the Applewatch will have.
If it has unique features it may command a price.

 

[manu chao]

Let's bookmark that and come back in two months when we should know the answer.

I cannot convince you that your guess was not very logical by simply showing that you were wrong. You'd either see your wrong guesses accumulating or you remain convinced that logic was on your side and it's not your fault if the world behaves illogical.