Is Interest in the Apple Watch Fading Already?

Increasingly it feels like the Apple Watch has invaded wrists in meeting rooms. We stare with bemusement as the owners proudly announce how it has changed their lives by telling them to stand up every hour and maybe walk more often [the Apple Watch vibrates if you have been sitting for more than 60 minutes]. But the Apple Watch is selling by the bucket load, right?

Whilst the average Apple fan boy is desperately trying to justify their $500+ purchase to anyone and everyone they bump into using ubiquitous phrases such as "I would be lost without it" or “It has revolutionized my life”, could interest in the Apple Watch be on the decline outside of Apple's hard-core fan base?

According to Seeking Alpha, Pacific Crest analyst Andy Hargreaves wrote

Store visits, Google search volume, third-party data and recent supply checks all suggest [the demand has fallen off]

A quick look at Google Trends reveals the predicted spike upon the big release that was surrounded by hype and fanfare. It is clear however that there is an apparent drop in interest after the early adopters and Apple Fans had completed their purchase.

For fiscal 2015, Hargreaves advised he’s cutting predicted sales to 10.5 million unit sales from 11 million. And more interestingly for 2016 sales, he cut his estimates further from 24 million to 21 million.

Anecdotal evidence suggests Apple Watch demand is slowing quickly - Andy Hargreaves

Many have pointed out that people simply do not wear watches anymore and those that do, don’t expect a premium timepiece to become obsolete when the 2nd generation is released a year later. Maybe the Apple Watch is only appealing to a niche market of tech and Apple fans who will always rush out and buy that latest must-have gadget, but is there a sustainable business model outside of this consumer base? These latest figures would suggest not.

Despite consensus that the release of the Apple Watch would harm the fitness market, it would appear the opposite might be occurring. Recent reports suggest that the average consumer is happier with a $50 Fitbit than the cheapest Apple Offering for $350.

More and more people are putting a heavier focus on what they need rather than what they want, and extravagant purchases with a short shelf life are not a priority for many who are watching what they spend.

A recent RBC reported stated

Our proprietary survey indicates a growing interest in Fitbit products (Surge, Charge, Charge HR) vs. Apple Watch, as well as other activity/fitness trackers such as Jawbone, Garmin, and others. Pricing remains a factor in decision making, coupled with battery-life and smartphone-independent GPS-tracking, broader platform and social engagement are some of the factors that appeal to consumers.

Meanwhile Slice Intelligence reported that more Fitbit devices were sold online in May 2015 than Apple Watches - 850,000 Fitbit's sold vs. 777,000 Apple Watches. Fitbit is also predicted to see its revenue grow by 83% as the mass market begins to embrace wearable tech, but not necessarily of the Apple variety.

Apple has a strong ethos of providing aspirational products. However, it seems that customer attitudes are changing along with a growing realization that you do not have to pay hundreds of dollars for a device when cheaper alternatives often perform many of the same tasks.

We are becoming more frugal and it’s getting harder to fool consumers with shiny expensive tech that claims to offer solutions to problems that we do not actually have. This could cause Apple a few problems if they want to concentrate on the mass market.

However, I doubt that Apple would want to dilute or cheapen their brand with offering cheaper products, but we are starting to see slight chinks in their previously untouchable armor.

The recent release of Apple Music seemed to be playing catch-up with the likes of Spotify and even when launched left many saying it felt cluttered or clunky. Is the declining interest in the Apple Watch about something more and are people starting to grow weary of the Apple brand itself?

It’s important to remember that iPhones are still selling by the bucket load with 61 million handsets selling in the first three months of 2015. The sale of 10 million watches is far from disastrous, but the big question the length of life.

We are also becoming more socially aware and persistent stories of Apple products being made in harsh working conditions in China to be then sold at inflated prices in the west will only fuel the fire. I suspect it's more about them being too darn expensive.

The truth is most of us have very little need for a watch when our entire lives are carried around on our smartphones. Even if we did need one, rushing out to buy a 1st generation device that will be old news in 8 months’ time could be considered by some to be unwise.

Anurag Harsh [other articles] is a founding exec of Ziff Davis (NASDAQ: JCOM), the world's largest tech & gaming digital corp. He graduated (MBA/MS) from Wharton & MIT, has performed two sold out solo concerts at Carnegie Hall and co-authored the McGraw-Hill bestseller “M-Commerce Security”. Follow him on LinkedIn or Twitter @anuragharsh