A comprehensive study into the British smartwatch market by watch industry analyst GfK has concluded that this year’s launch of the Apple Watch will ignite sales in the fledgling category.
However, the comprehensive report has plenty of encouragement for traditional watch brands and retailers who will have time to react to a threat that is still poorly defined and understood by the general public.
Complacency, though, would be a mistake in a week when Apple has put smartwatches on the front pages of global media. Almost half (46%) of consumers are aware of the Apple Watch launch. “This is an impressive number for a new product launch and reflects Apple’s dominance in the consumer tech category,” GfK says.
This awareness is also translating into demand. Overall, 19% are extremely or very interested in the launch. 20% are fairly interested. More than one in ten (12%) plan to buy a smartwatch in the next six months. Breaking this down demographically:
• 25-34s are most likely to be extremely or very interested (36%).
• 56% of current smartphone owners are extremely or very interested, compared to 12% of non-owners.
• 61% of those intending to buy are extremely or very interested, vs. 17% of non-owners.
• 27% of Apple fans are extremely or very interested in the launch, as are 29% of owners of other Apple devices.
The desire to buy a smartwatch might not translate immediately into purchases because there is plenty of competition for consumers’ cash. Given a list of consumer electronics people might buy, smartwatches came sixth behind a smartphone, tablet, laptop, games console and smart TV.
The study did not compare the desire to buy a smartwatch to more traditional watches.
GFK’s research has been released in the week of Apple Watch’s launch, but was conducted prior to its launch. Even so, 57% of prospective purchasers said they would wait until the launch of the Apple Watch before deciding which smartwatch or fitness brand to buy.
“We can see evidence of this in our sales tracking data. In Q1 2015, sales volume of smartwatches fell 21% compared to the same time last year. By comparison, the sales volume of wearable tech overall increased in the same period – up 52% and growing 22% in value year on year. Health and fitness trackers are driving the wearables category, up 327% in volume and 356% in value since Q1 2014,” the report says.
Anne Giulianotti, joint head of technology at GfK says: “Apple is a much loved and admired brand – so it’s no wonder that many potential smartwatch buyers are delaying their decision on what to buy until the launch of its device on 24th April. In Q1 2015, smartwatches made up 7% of the wearable tech category. With the launch of Apple’s watch in a few days, we expect that figure to rise as people see what one of the world’s favourite tech brands has to offer.”
Apple is offering a deep list of price points for its Watch collection, but only the entry-level sports version hit the sweet spot with consumers, GfK discovered.
The majority (73%) of people interested in the launch of the Apple watch say they are prepared to spend up to £299, the price of the small sports version of the smartwatch. 17% are prepared to spend between £300-£399, and one in ten (10%) are prepared to pay £400 or more – closer to the £479 price tag of the basic standard Apple smartwatch.
Anne Giulianotti says: “Apple is a master at creating desirable new personal tech devices – not to mention entire categories – but gaining mass appeal for the smartwatch may be the greatest challenge yet. The high price point and lack of clarity around smartwatch benefits generally mean that this wearable technology will have to provide an outstanding experience if its sales performance is to come close to that of the iPad or iPhone.”