Edition - Top or Flop?

[kerosene]

Watch Edition appears to be the most discussed. Gruber mentioned a $5000 price point.

My personal take: it won't be very successful - functionality is not that 'need to have' yet; it's a bit geeky; needs daily charging; will become obsolete in a few years; same watch as the cheap ones, only difference materials and price; can't compete with high end mechanical timepieces for longetivity and prestige.

Time will tell.

For the fun of it, what's your take - top or flop?

 

[JayLenochiniMac]

Define "successful." $5,000 anything is never going to sell in as many numbers as a $349 product. That's why Apple can make the Edition models as exclusive as possible while still selling a good number of the lower trims.

 

[kerosene]

Define "successful." $5,000 anything is never going to sell in as many numbers as a $349 product. That's why Apple can make the Edition models as exclusive as possible while still selling a good number of the lower trims.

Many ways to measure success. Apart from sales numbers and profit margins - does it add value to the brand? Or, does it dilute the brand, in the same way Dolce & Gabbana got diluted because everyone and their dog in Russia started wearing their T-Shirts?

For me it's the latter. Apple used to be good for the things it didn't do as much as what it did.

 

[repentix]

I don't see the point in the watch in the first place, not to say a 5000 $ watch which is going to be obsolete in one or two years. I am still waiting for a smartwatch that is independant from your smartphone and only requires bluetooth to get apps onto the smartwatch which then work independantly, a smartwatch with a 3.5 inch jack for my headphones, a smartwatch which doesn't need to be connected to my phone all the time! The watch looks and feels like a good idea, but it isn't made to last! It doesn't have any sort of lightning or 3.5 inch jack for jailbreaking or useful things and I have the feeling, that the software updates will magically stop in two years time! It will most certainly have underpowered hardware and apple will restrict any kind of really useful app.

Adding to the no ports policy on the watch, I think apple wants to stop jailbreaking on the watch through a closed system with the iphone being the only way of communicating with it. This seems to be apples long term approach with ios devices in general.

 

[JayLenochiniMac]

Many ways to measure success. Apart from sales numbers and profit margins - does it add value to the brand? Or, does it dilute the brand, in the same way Dolce & Gabbana got diluted because everyone and their dog in Russia started wearing their T-Shirts?

For me it's the latter. Apple used to be good for the things it didn't do as much as what it did.

They'll most likely not provide a breakdown of the different models. It'll be inside information and all we'll know is how they're doing as a category.

 

[Mad Mac Maniac]

I voted top, but I think it's way, way way too early to really even guess. My vote is mostly based on Apple's recent successes.

Information still needed
-Cost
-Upgrade program
-where/how will be sold
-finalized software features
-battery life
-the charging base
-weight/quality of gold/material

Then of course this is also based on not even having seen one in person. Just way to many variables to merit any kind of educated guess.

 

[mtmac]

Gruber also predicted a replaceable smart watch component, therefore it would not be outdated in a couple years. They will succeed with the edition watch as well as the disposable sport and upgradeable aWatch as well.

The number of sales will go down as the price increases, but the profitability per unit will go up. I'm betting they will make the most overall on the aWatch, then sport, then edition. The edition however is the Corvette that gives it the substance, which will drive people in to look, and most will settle on a Camaro or Impala.

So yes, the edition is a top tier product like the MacPro, but they make more money and sell more units like the MacBook Air.

Having an upgradeable, well-designed, long-lasting timepiece made out of high quality traditional materials will be the hook that sells the smart watch to the masses. This is the new iPod or iPhone. This will become the new "must have" item, if not this generation, a later one just like those two products.

 

[lostgear]

If the editions is solid gold, then it will be thousands. My guess is that it will be some type of gold shel.

However if it is solid gold, then come upgrade time, I bet Apple will do some kind of buy-back towards the cost of the upgrade.

 

[cariacou]

Watch Edition appears to be the most discussed. Gruber mentioned a $5000 price point.

My personal take: it won't be very successful - functionality is not that 'need to have' yet; it's a bit geeky; needs daily charging; will become obsolete in a few years; same watch as the cheap ones, only difference materials and price; can't compete with high end mechanical timepieces for longetivity and prestige.

Time will tell.

For the fun of it, what's your take - top or flop?

low volume, high margin. definition of luxuary products.
lots of companies succeed with similar business models: think Ferrari, LMVH, Rolex, ...


it's been decades since they started and no one would think about calling them flops

 

[kerosene]

low volume, high margin. definition of luxuary products.
lots of companies succeed with similar business models: think Ferrari, LMVH, Rolex, ...


it's been decades since they started and no one would think about calling them flops

I don't know...Apple reaching out for these customers feels like overstretching to me. Yes there were those who needed to goldplate their iphones before, but this was never mainstream, never Apple itself. Apple used to stand for the most desirable consumer technology, but it was always within the reach of the middle classes. The Gold watch breaks with that culture.

Apple now trying to play a role in the luxury segment to me is as if Ferrari would start to produce small but pricey everyday cars of the VW Golf range. It' s a stretch out of their segment that doesn't do them any good, neither in their luxury segment nor in the new one, just dilutes the brand.

 

[Piggie]

If the editions is solid gold, then it will be thousands. My guess is that it will be some type of gold shel.

However if it is solid gold, then come upgrade time, I bet Apple will do some kind of buy-back towards the cost of the upgrade.

There is not going to be THAT much gold in it

 

[SHNXX]

depends on what the definition of top/flop is in terms of sales and how expensive the Edition is.

 

[lostgear]

There is not going to be THAT much gold in it

Lets say the watch weighs 250g, which is not unreasonable for a 42mm watch, and 200g of that is the case, at current gold rates, that is about £5,357, never mind machining costs etc.

That is a substantial amount to shell out on a 2 year basis.

The Editions is going to be v.expensive and v.exclusive.

 

[SHNXX]

Lets say the watch weighs 250g, which is not unreasonable for a 42mm watch, and 200g of that is the case, at current gold rates, that is about £5,357, never mind machining costs etc.

That is a substantial amount to shell out on a 2 year basis.

The Editions is going to be v.expensive and v.exclusive.

The whole watch might weigh that much but that would include the crystal sapphire, the chip inside, sensors, strap, buckle, etc.
In short, the weight of the gold will be much less.

 

[lostgear]

The whole watch might weigh that much but that would include the crystal sapphire, the chip inside, sensors, strap, buckle, etc.
In short, the weight of the gold will be much less.

Role on 'early 2015' when we can all stop speculating........#

 

[iolinux333]

low volume, high margin. definition of luxuary products.
lots of companies succeed with similar business models: think Ferrari, LMVH, Rolex, ...


it's been decades since they started and no one would think about calling them flops

Ferrari flopped with that model and got bought by FIAT whose claim to fame is making cheap junk in huge volume for the masses. I could cite a dozen more examples of the same. You should hope Google one day doesn't end up buying Apple.

Remember when Motorola and their RAZR were king of the mountain?

 

[Kavier]

I like the edition, but I will have to wait to see what the sales price is before I decide whether or not to purchase.

 

[SHNXX]

Ferrari flopped with that model and got bought by FIAT whose claim to fame is making cheap junk in huge volume for the masses. I could cite a dozen more examples of the same. You should hope Google one day doesn't end up buying Apple.



Remember when Motorola and their RAZR were king of the mountain?

Not only that but the notion that apple watch is like a Ferrari must be some kind of a failed attempt at comedy.

 

[mtmac]

Voting presently against Apple. I wish I could get those odds in Vegas. They have more tops than flops.

 

[Phil A.]

I think it will definitely be a hit.

You only have to look at how many celebrities / sports men and women and other personalities brandish an iPhone and I would suspect that a large percentage them of could buy a $5K or $10K watch without even noticing it and probably will buy one.

IMO, the Watch Edition isn't about attracting people who buy expensive swiss made timepieces so much as it is about attracting the new generation of rich listers who don't currently wear a watch at all

 

[kerosene]

Expanding a bit on the pricing idea that the Watch Edition would not cost an arm and a leg contrary to what Gruber and many others have predicted (i.e. under $1500).

This would come to the surprise of many, and could really create a small sensation. Apple could come out and say - 'Hey, we appreciate you want our watch in a material of your liking, but contrary to what the whole luxury industry is doing when it comes to precious metals, we're Apple, we're not greedy and we think what we produce has value by what it is, not by what it appears to be. Our business is to always offer a fantastic value proposition, not to blow prices out of proportion. So you like gold, we do too, but we don't see why you should be paying the crazy prices the luxury industry wants you to. That's why the Edition starts at $1499 - the best gold watch money can buy.'

Doing this Apple could indeed have again found its sweet spot in a new industry. Not by howling with the wolves and trying to become like them, but by going strictly against the traditions and market models of the big watchmakers.

IMHO that would be a stroke of genius strategy, the early presentation and making Gruber and others believe (and vocally resound) that Apple is trying to become a luxury company would fit in perfectly.

 

[Julien]

...This would come to the surprise of many, and could really create a small sensation. Apple could come out and say - 'Hey, we appreciate you want our watch in a material of your liking, but contrary to what the whole luxury industry is doing when it comes to precious metals, we're Apple, we're not greedy and we think what we produce has value by what it is, not by what it appears to be. Our business is to always offer a fantastic value proposition, not to blow prices out of proportion. So you like gold, we do too, but we don't see why you should be paying the crazy prices the luxury industry wants you to. That's why the Edition starts at $1499 - the best gold watch money can buy.....

Since the least expensive 18K gold luxury watch usually starts well north of $10,000, Apple can say exactly the same at a $5000 price point.

Also while Gruber says $5,000 a likely starting point he also says "... I made a friendly bet last week with a few friends on the starting price for the Edition models, and I bet on $9,999..."

While it could come in lower than 5G I just don't see anyway it will be $1,500. If going for this 'bottom' feeder market Apple would have just used the more common consumer grade jewelry of 14K. Using 18K gives a STRONG hint that Apple is looking more upscale.

Also to add another hint: Look at the band hardware (18K too). It is put together with 4 screws instead of rivet fasteners. The 2 rivet fasteners appear to hold a tension spring. Anyone in the jewelry business will tell you this is a sign of quality.

 

[kerosene]

Since the least expensive 18K gold luxury watch usually starts well north of $10,000, Apple can say exactly the same at a $5000 price point.

Also while Gruber says $5,000 a likely starting point he also says "... I made a friendly bet last week with a few friends on the starting price for the Edition models, and I bet on $9,999..."

While it could come in lower than 5G I just don't see anyway it will be $1,500. If going for this 'bottom' feeder market Apple would have just used the more common consumer grade jewelry of 14K. Using 18K gives a STRONG hint that Apple is looking more upscale.

Also to add another hint: Look at the band hardware (18K too). It is put together with 4 screws instead of rivet fasteners. The 2 rivet fasteners appear to hold a tension spring. Anyone in the jewelry business will tell you this is a sign of quality.

Image

I strongly disagree that at $5000 Apple can use the same line of argumentation.

As discussed in another thread, the estimated 20g of 18K gold in the shell are around $600 according to market prices. The rest of the watch isn't that different from what's in the $350 entry price for the Sport. it's a pimped up mass product, nothing else.

If they really want to go for prices of $5000 and beyond I predict limited success/failure, and permanent damage to the brand. In this case Android will eat them alive on the consumer electronics front and Apple will find itself in a silly Vertu like existence.

 

[Julien]

...In this case Android will eat them alive on the consumer electronics front and Apple will find itself in a silly Vertu like existence.

Whether $1,000 to $10,000 the Edition is not targeted as an Android competitor or even for the average user. The Sport is going head to head against Android watches and is meant to be the bread & butter seller to the public at large. If the average person wants to move upscale they can buy the Watch. The aWatch will succeed or fail on the back of the Sport and not the Edition. The Edition is 'bait' to lure 'normal' people into buying the Sport. In many ways the more the Edition costs the more desirable the Edition will be to celebs and the more desirable the $350 Sport will be to the general public.

Apple famously invited the fashion and jewelry industry representatives to the event to preview the aWatch. If Apple doesn't offer a fashion/jewelry statement in the Edition they will be ridiculed as a fashion poser/charlatan in the fashion/jewelry press.

 

[SHNXX]

The reality is that if its $5000, it is a product that is targeted at the extremely wealthy.

When a wealthy person buys a traditional watch that is 5-30k, they most likely will use it for many many years, likely over 20 years with service every 5 years.

When someone buys a 5k or above apple watch, the watch will be functionally obsolete and even worse, possibly rendered useless by year 3 because of degradation of battery performance from many charging cycles.
Furthermore, apple will not have parts to service the watch at some point.

So let's say that one expects to use apple watch to its capability for about 3 years since by then, there will be much better watches from Apple and the battery life will have degraded.

That's an annual expense of about $1700.

If you assume that you can use a mechanical watch with no problem for at least 30 years with lets say $1500 service every 5 years, a mechanical watch equivalent in per annum expense would be a $42000 watch (1700 per year including service costs).
This doesn't even account for the fact that mechanical watches have much much better value at the end of 20-30 year of ownership compared to apple watch at the end of 3-5 year ownership.

Most people cannot afford a $42000 watch so if the apple watch really is $5000 for a device that should work no more than 3-5 years, this would not be targeted at the masses.

Similar calculations also point to the fact that even at 3000, the apple watch is comparable to a $20000 watch, although people won't be making this kind of calculation when buying.
Thus it is safe to say that despite the forum members' attempts to justify the costs by suggesting upgrade plans, etc, the Edition may not be targeted at the average apple product buyers at all.