Holy... I just Realized Why the Apple Watch Is $349+

MICHAELSD

macrumors 68040
Original poster
Jul 13, 2008
3,714
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They're following the iPhone's launch cycle by starting it high to build demand, then subsequently dropping the price to make a lower price seem like a value. It's a marketing mind game.

Confession: I was one of the people that said $600 was too high for the iPhone and that I'd buy it after a price drop but I caved after two weeks. Don't see that happening here but who knows once I try it... :rolleyes:
 

mtmac

macrumors regular
Nov 30, 2012
127
0
Apple just hinted at what will be possible on the watch. The release was so that Apple could present the watch rather than slowly have their Asian suppliers leak it part by part over the next six months.

I expect it to be far more competent than any other watch out there when released. The build quality from those who have seen it in person have said that it is impeccable. While I think the gold releases will be ridiculously priced, the base price for the best smart watch in the market is reasonable. Upon introduction, iPods were priced much higher than the MP3 players already out, but the ease of use proved that people were willing to pay a premium for something superior. The digital crown will go down as a legendary input device, like the mouse from the mac, or the jog wheel from the iPod.

We've gotten spoiled by everything being so incredibly cheap. This is an incredible amount of technology for $350. From PC Magazine, 4/15/2012 "Forty years ago this month, Hamilton introduced the world's first commercial electronic digital wristwatch. It retailed for the pricey sum of $2,100.(It would go for about $11,400 today.)" Give it another decade and people will bitch it doesn't have a 4K display.
 

Cashmonee

macrumors 65816
May 27, 2006
1,196
876
They're following the iPhone's launch cycle by starting it high to build demand, then subsequently dropping the price to make a lower price seem like a value. It's a marketing mind game.

Confession: I was one of the people that said $600 was too high for the iPhone and that I'd buy it after a price drop but I caved after two weeks. Don't see that happening here but who knows once I try it... :rolleyes:
You think the pricing on the original iPhone was planned? Apple way overpriced it. They made a mistake (it is possible, you know), and paid dearly in correcting it. At the time it was quite the blunder. I remember watching the announcement, giddy with excitement as they went through all that it does, only to be smack down off my high when the price was shown. The iPhone didn't really start selling until the 3G.
 

SHNXX

macrumors 68000
Oct 2, 2013
1,835
629
I don't think so.

Apple watch is not subsidized.
As long as it uses crystal sapphire and high-grade stainless steel, it will remain at high prices relative to cheap disposable watches from the competition.
 

JerZyT28

macrumors regular
Jul 24, 2011
169
9
cheap disposable watches from the competition? Enlighten me


I don't think so.

Apple watch is not subsidized.
As long as it uses crystal sapphire and high-grade stainless steel, it will remain at high prices relative to cheap disposable watches from the competition.
 

epicnemesis

macrumors member
Oct 30, 2008
50
20
You think the pricing on the original iPhone was planned? Apple way overpriced it. They made a mistake (it is possible, you know), and paid dearly in correcting it. At the time it was quite the blunder. I remember watching the announcement, giddy with excitement as they went through all that it does, only to be smack down off my high when the price was shown. The iPhone didn't really start selling until the 3G.
Funny how carrier subsidies change perception. I just bought my iPhone (6 128gb) for 850 bucks before taxes. Wasn't the original 600 for 8GB?

The phone was well priced, it just didn't have the subsidy that the American market is used to.
 

MICHAELSD

macrumors 68040
Original poster
Jul 13, 2008
3,714
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NJ
I don't think so.

Apple watch is not subsidized.
As long as it uses crystal sapphire and high-grade stainless steel, it will remain at high prices relative to cheap disposable watches from the competition.
Despite the subsides only possible on phones, as Apple did end up lowering the non-subsidized price by $199, $349 is too high for a mainstream market.
 

T5BRICK

macrumors G3
Aug 3, 2006
8,103
2,098
Oregon
cheap disposable watches from the competition? Enlighten me
I think they were referring to other smart watches.

http://www.samsung.com/us/mobile/wearable-tech


Despite the subsides only possible on phones, as Apple did end up lowering the non-subsidized price by $199, $349 is too high for a mainstream market.
It's priced just fine for what it is. I won't be buying one, but the price isn't why.

The original iPhone didn't have any subsidy, that was Apples mistake. If it had been sold the same way as current iPhones, they wouldn't have needed to drop the price.
 

Cashmonee

macrumors 65816
May 27, 2006
1,196
876
Funny how carrier subsidies change perception. I just bought my iPhone (6 128gb) for 850 bucks before taxes. Wasn't the original 600 for 8GB?

The phone was well priced, it just didn't have the subsidy that the American market is used to.
The original iPhone was subsidized. $499 for 4GB and $599 8GB was the on contract price. You couldn't buy it without a contract. What happened was that AT&T and Apple split profits, part of which were profits Apple ate to get the price down a bit. It was subsidized, just not in the way phones are usually subsidized.
 

JerZyT28

macrumors regular
Jul 24, 2011
169
9
I think they were referring to other smart watches.

http://www.samsung.com/us/mobile/wearable-tech




It's priced just fine for what it is. I won't be buying one, but the price isn't why.

The original iPhone didn't have any subsidy, that was Apples mistake. If it had been sold the same way as current iPhones, they wouldn't have needed to drop the price.
Then saying that was a sheep response. Personally used the G watch and its a fine watch. Just don't have a need for it. Bow the Moto 360 is out, best looking smart watch out..hands down. Google software on it works fine too. The only issue for me? I have no specific need to pay over $200 for a smart watch.
 

SHNXX

macrumors 68000
Oct 2, 2013
1,835
629
Then saying that was a sheep response. Personally used the G watch and its a fine watch. Just don't have a need for it. Bow the Moto 360 is out, best looking smart watch out..hands down. Google software on it works fine too. The only issue for me? I have no specific need to pay over $200 for a smart watch.

It looks like **** (46mm with thin bezel is a stupid dimension for watches for humans) and uses glass, has a non round screen, low grade stainless steel (not 316L) and it's $250.

Truth is that 250 is just not possible for reasonable quality material on watches.
 

cariacou

macrumors 6502a
Jul 21, 2010
503
424
They're following the iPhone's launch cycle by starting it high to build demand, then subsequently dropping the price to make a lower price seem like a value. It's a marketing mind game.

Confession: I was one of the people that said $600 was too high for the iPhone and that I'd buy it after a price drop but I caved after two weeks. Don't see that happening here but who knows once I try it... :rolleyes:

yes and no :)
that was only for the iphone.

think about the ipad: unexisting market. had to create the need for it. low release price: $499.
now, 5 years later, price: $499. not a cent cheaper :)


the apple watch will be the same. I don't expect it to be sold any lower than $249 for the 2-year outdated model.
 

mtmac

macrumors regular
Nov 30, 2012
127
0
$349 is too high for a mainstream market.
If you think that's too high for adoption, prepare to be shocked by how many people buy the gold version that will make the $350 version look comparably dirt cheap.
 

iEnvy

macrumors 65816
Jun 25, 2010
1,129
175
DFW
How much do you guys think premium watches cost? This is fairly normal pricing and on top of that, it's a smart watch with Apple build quality and premium materials.
 

itjw

macrumors 65816
Dec 20, 2011
1,088
6
How much do you guys think premium watches cost? This is fairly normal pricing and on top of that, it's a smart watch with Apple build quality and premium materials.
$350 is a steal. Especially when you consider every 11 year old and unemployed, living at home, loser will have to have one because, well... same reason they have to have an iPhone, because if they don't they won't be "cool".

Apple has introduced a product that (if we're talking about real Swiss stuff) is unattainable to most normal folks at current prices, let alone the destitute of the world that always somehow seens to end up with an iPhone even though they can't pay their electric bill. But three fiddy? I can has it!

Now, people who can't afford to plop down thousands on a real timepiece, can instead buy an Apple watch and still think they have status.

It's actually a pretty smart move.

VERY few people that actually have a high end watch now ($2K+) will be switching (they may be adding, don't get me wrong, but not switching).

But for the people that always wanted a watch for status, but couldn't afford a Rolex/Omega/Paneri/Patek/Etc..., it's an option that is feasible.

If Apple really wanted to sell a lot of them, they should offer some crazy finance plan. Even if they did so at 24% interest, as long as the down payment was small (say, $99), they'd sell in droves.

The Apple Watch is in a niche in between the Timex/Fossil/Movado's of the world and the Chronometer timepieces of Switzerland.

As long as they market to that niche, it'll do just fine.
 

edhchoe

macrumors 6502a
Oct 28, 2011
780
259
it costs $200 to manufacture iPhone. with 2 year contract you pay $200.
but with a watch we won't have a contract. so no subsidizing. therefore, it will play out differently.
 

MICHAELSD

macrumors 68040
Original poster
Jul 13, 2008
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it costs $200 to manufacture iPhone. with 2 year contract you pay $200.
but with a watch we won't have a contract. so no subsidizing. therefore, it will play out differently.
As I had pointed out, the $599->$399 drop was unsubsidized.

----------

$350 is a steal. Especially when you consider every 11 year old and unemployed, living at home, loser will have to have one because, well... same reason they have to have an iPhone, because if they don't they won't be "cool".

Apple has introduced a product that (if we're talking about real Swiss stuff) is unattainable to most normal folks at current prices, let alone the destitute of the world that always somehow seens to end up with an iPhone even though they can't pay their electric bill. But three fiddy? I can has it!

Now, people who can't afford to plop down thousands on a real timepiece, can instead buy an Apple watch and still think they have status.

It's actually a pretty smart move.

VERY few people that actually have a high end watch now ($2K+) will be switching (they may be adding, don't get me wrong, but not switching).

But for the people that always wanted a watch for status, but couldn't afford a Rolex/Omega/Paneri/Patek/Etc..., it's an option that is feasible.
This is an insightful comment... I didn't look at it in this way. While I doubt many consumers will consider an Apple Watch high-end compared to a Rolex, etc., I do think it's in an interesting marketing space that places it between a brand like Fossil and the brands you had listed. Frankly yes, the Apple Watch will be more iconic than a Fossil watch but...

You rarely see two people with the same watch whether it's from an awful brand like Timex, a brand I find to be the best-bang-for-your-buck such as Fossil, Rolex, Omega. However, the Apple Watch will quickly compare to an iPhone in terms of exclusivity provided. I.e. If you're in NYC, you won't see your favorite Fossil watch on someone else on a normal day although a few months after the Apple Watch you will see plenty of them around. In 2-3 years it won't feel as high-end when 'everybody' has one.
 

kilcher

macrumors 65816
Jul 3, 2011
1,262
316
They're following the iPhone's launch cycle by starting it high to build demand, then subsequently dropping the price to make a lower price seem like a value. It's a marketing mind game.

Confession: I was one of the people that said $600 was too high for the iPhone and that I'd buy it after a price drop but I caved after two weeks. Don't see that happening here but who knows once I try it... :rolleyes:
Whoa! I think you're on to something! I don't know why all new technology doesn't cost more at first then come down as component costs come down, R&D costs are recouped, items can be produced and sold in mass quantities, etc. etc.

Oh wait.
 

itjw

macrumors 65816
Dec 20, 2011
1,088
6
As I had pointed out, the $599->$399 drop was unsubsidized.

----------



This is an insightful comment... I didn't look at it in this way. While I doubt many consumers will consider an Apple Watch high-end compared to a Rolex, etc., I do think it's in an interesting marketing space that places it between a brand like Fossil and the brands you had listed. Frankly yes, the Apple Watch will be more iconic than a Fossil watch but...

You rarely see two people with the same watch whether it's from an awful brand like Timex, a brand I find to be the best-bang-for-your-buck such as Fossil, Rolex, Omega. However, the Apple Watch will quickly compare to an iPhone in terms of exclusivity provided. I.e. If you're in NYC, you won't see your favorite Fossil watch on someone else on a normal day although a few months after the Apple Watch you will see plenty of them around. In 2-3 years it won't feel as high-end when 'everybody' has one.
I agree exclusivity goes down over time and adoption (I see iPhones everywhere now, and they sure used to be "exclusive" even if the folks that think they're above all that refuse to believe it).

That's the exact reason I don't see Apple in the watch game for the long haul though. Not only is it going to lose it's status just as fast as it gets it, it's also going to suffer because people won't want to upgrade every year.

If they thought the iPad market was tough to churn every year, wait until they hit the watch market. Not to mention that very few folks are going to be chomping at the bit to buy a year old watch anyway (hurting resale and also hurting upgrade potential). Even with new features, if they aren't "revolutionary" it'll be hard to convince an upgrade every few years, let alone every one.

That, coupled with a relative lack of exclusivity over time (because the price point is too LOW in my opinion), means it isn't a long term play in my mind.

They could have made it outrageously expensive ($1999 to start), and then slowly dropped the price over time with "budget" models (or a new model altogether made of polymer or something). Instead, by making it available to everyone, they actually made it less attractive to the high end buyer.

People don't buy Rolex's because they keep great time. They buy them because of how they feel about themselves wearing them. I'm not saying that as a knock, because I'm as guilty of that as anyone (but at least I admit it). It's why "replicas" sell so well. It's not about the watch, it's about the status the watch provides.
 

SingingSabre

macrumors newbie
Sep 15, 2014
13
0
Tucson, AZ
While I think the gold releases will be ridiculously priced...
It's not a gold colored watch, like the "gold" iPhone. It's gold, and according to some sources, solid gold.

This is a play for the luxury goods market, not the entry level tech market.

Apple Watch Sport will be like your iPhone 5S, the base model. The Edition models will be aimed at high end purchasers. It's a fascinating move and I'm super excited to see how everyone in the spectrum reacts once things are finalized and announced. :)
 

Piggie

macrumors G3
Feb 23, 2010
8,380
2,732
It's not a gold colored watch, like the "gold" iPhone. It's gold, and according to some sources, solid gold.

This is a play for the luxury goods market, not the entry level tech market.

Apple Watch Sport will be like your iPhone 5S, the base model. The Edition models will be aimed at high end purchasers. It's a fascinating move and I'm super excited to see how everyone in the spectrum reacts once things are finalized and announced. :)
The thing is.

I'm not even sure Ohhhhh GOLD has a lot to do with it.

Not many people having something I would suggest it more to the point.

Let's be honest, Gold is, in many ways, tacky and as common as much, it's a VERY trashy low class status symbol.

Exclusivity is Far More a status symbol than gold.

It's almost as if Gold is the thing that the masses think makes them special, but the special people have things the masses do not.

As has been said above. Apple's watch is going to give you almost zero exclusivity as most people on a moderate income can afford one, even children as birthday/Christmas gifts will have one.

Having the same device, but in gold/colored gold/solid gold, call it what you will, makes no difference, it will be the same watch in different colors everywhere you look.

And of course, it will be dead easy to get a steel one Gold Plated really cheap, so that knocks the gold look out the window.

Sitting eating your meal with your classy old rolex etc, will still make you feel above the masses playing with their apple toy that's out of date next year.

This being said. I see nothing wrong with the Apple watch as a device.
I just STRONGLY question some of the fantasy views people here have.

It's not special, it's not going to be special, and it never will be special.
It's too dam common.
 

Julien

macrumors G4
Jun 30, 2007
11,276
4,246
Atlanta
...Let's be honest, Gold is, in many ways, tacky and as common as much, it's a VERY trashy low class status symbol.

Exclusivity is Far More a status symbol than gold.

It's almost as if Gold is the thing that the masses think makes them special, but the special people have things the masses do not.....
Let's be honest: Au is a special metal with properties like malleability, hight specific gravity and is also non-corrosive.

Let's be honest: Au is also the most beautiful and alluring metal that has captivated humans attention for over 5000 years. ;)

Lets' be honest: Au can NOT be called common since you could hardly fill a single swimming pool with ALL of it: :eek:

 

Piggie

macrumors G3
Feb 23, 2010
8,380
2,732
Let's be honest: Au is a special metal with properties like malleability, hight specific gravity and is also non-corrosive.

Let's be honest: Au is also the most beautiful and alluring metal that has captivated humans attention for over 5000 years. ;)

Lets' be honest: Au can NOT be called common since you could hardly fill a single swimming pool with ALL of it: :eek:

Image
Some disagreement about that :)

http://www.bbc.co.uk/news/magazine-21969100

However, my point still stands.

You could have a gold bar on your wrist, and it still be worth less that a sheet of paper as far a monetary value, and desire to own that item goes if that sheet of paper has something written on it by some special person.

It's really all about exclusivity. The fewer people can own something often the more desirable it is, or course it helps with who made it.

It still feels that, perhaps in time the higher priced Apple Watches, should have more things unique to them apart from just the colour.
 

Michael CM1

macrumors 603
Feb 4, 2008
5,677
273
Funny how carrier subsidies change perception. I just bought my iPhone (6 128gb) for 850 bucks before taxes. Wasn't the original 600 for 8GB?

The phone was well priced, it just didn't have the subsidy that the American market is used to.
Ding ding ding.

The only pricing blunder was the non-availability of subsidies. You still had to sign a two-year contract and didn't get any discount, so it was like the phone cost another $300 compared to the others at the time.

Perhaps Apple was trying to kill contracts back then, but it doesn't work when Apple had almost zero control over the contracts. It took a desperate T-Mobile to do this, and thank goodness it did.
 

matrix07

macrumors 603
Jun 24, 2010
5,330
1,983
Whoa! I think you're on to something! I don't know why all new technology doesn't cost more at first then come down as component costs come down, R&D costs are recouped, items can be produced and sold in mass quantities, etc. etc.
Yes, it comes out of thin air. The first break through technology shouldn't cost more than many iterations later. Apple is greedy. Don't you know even a kid can invent an iPhone? :p

Holy! (I love this word. Sounds like you discovered something you still have no clue about)
 
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