A Different Perspective on Smart Watches
On Tuesday Apple launched the Apple Watch, portraying not only Apple’s entrance into the growing wearable market, but also the much more important fashion market. Therefore I think that any wearable strategy must be evaluated in the context of a fashion accessory, not a technical device. The main competitor of Apple’s watch is not the Moto 360, Pebble or any other smart watch, its biggest competitor are thousands of regular watches. The question facing all smart watches is: Can any of these compete with conventional models?
Relaunching the Image of Smart Watches
Let’s face it: Not a lot of people want to wear smart watches right now. It doesn’t matter how valuable their features might be. As long as they don’t match our style, we won’t buy them. Interestingly, Apple bought Beats a few months before launching the Apple Watch, a company that managed to turn headphones into a fashion accessory that people are willing to spend hundreds of dollars on. They also recruited Paul Deneve, former CEO and President of Yves Saint Laurent who completely overhauled the YSL brand. They poached Angela Ahrendts, former CEO of Burberry, relaunching Burberry as a global iconic brand and “a leader in the use of emerging technologies”. They hired Patrick Pruniaux, former Tag Heuer sales director, Musa Tariq, former Nike director, Marcela Aguilar, former director at Gap and probably many more. The accomplishments of Beats and these fashion CEOs sound just like what smartwatches need: Relaunching the image from a geeky accessory to an iconic fashion accessory. The big question only time can answer is, if they — or any other tech or fashion company — will succeed.
A Different Market
In fashion, brand image, advertisement and style are key. For example while Luxottica controls over 80% of the world’s major eyewear brands, almost nobody knows about them. They own Ray Ban or Oakley and manufacture & design for Chanel, Prada, Armani, Burberry, Versage and many others. This allows a single company to target a wide audience by offering a variety of styles and images.
Right now Apple itself is the only brand for the Apple Watch having three collections (normal, sports and edition). Just like fashion collections, every Apple Watch collection offers a variety of items (bands). But what if Apple does not stop here? Their Beats brand could offer collections that cater towards younger demographics while collaborations with fashion designers may offer exclusive, highly desired collections.
On the other hand, established watch makers or fashion companies may combine the open Android Wear (or possibly a Microsoft) platform with their market expertise to create fashionable smart watches and rival Apple’s acquired fashion expertise. In addition, partnerships by other electronic device makers with fashion companies (or hires) may also rival this expertise.
The most challenging part for tech companies is to enter an industry that is different from PCs and smartphones. An industry where a few devices (and a custom case) do not fit all your customers, where companies offer a variety of brands and collections, each matching the lifestyle and taste of a small customer segment. Therefore companies must approach wearables differently from how they design computers, phones or tablets. The success of wearables will not be decided on how well the Moto 360, Apple Watch, Pebble et cetera compare to each other. The question is if smart watches can be turnt into fashion accessories that regular people want to wear — similar to Beats turning regular headphones into a fashion accessory on a big scale.