Remember how the Apple Watch was supposed to be Apple’s next great project, revolutionize the wearables industry and be so amazing that none of us would ever be able to live without a device on our wrists ever again that could do everything from making phone calls and checking emails to tracking our heart rate to creating a new workout playlist?
Yeah, well, that … not so much happened…
In fact, the smartwatch industry remains very much a niche and specialized market, one that Apple and other brands and retailers have not done a very good job capitalizing on or monetizing so far.
To put things in perspective, Juniper Research released a market study in January of this year stating that the Apple Watch had claimed 52 percent of the smartwatch market in 2015.
According to The Wall Street Journal, Apple reported $6 billion in Apple Watch sales in 2015, the first year the product launched.
But Apple reported $233 billion in sales in 2015, so that $6 billion in Apple Watch sales is really a very small piece of that pie compared to the millions and millions of iPhone units the tech retailer moves each and every month.
And that was the first year of the product.
And Apple is now the market leader in smartwatches.
And it’s still not moving the needle for the company.
In an Android Authority piece from Feb. 2015, Mark Hearn, a writer who covers the tech industry, argues that smartwatches, like the Apple Watch (which retails anywhere from $299 to upwards of over $1,000, depending on the make, model, band and other features) or the Motorola Moto 360 (which retails for about $350), have failed to catch on precisely because they are such a niche, specialized and largely unnecessary item.
Not to mention that the things can be pretty darn pricey, too.
“Have we as people really gotten so lazy that our smartphones need a butler? In a sense, that’s what modern smartwatches are. Fans of these luxury items will argue otherwise and say they’re about convenience. ‘I get so many emails and text messages!’ But is pulling your phone out of your pocket really that much of a chore?” Hearn wrote. “This is my biggest gripe about smartwatches as a whole. They don’t really bring much to the table. Yes, they’re cool in theory and maybe even in demonstration, but what can you really do with one that can’t be done better with a smartphone? People most likely recognize this and simply want more.”
And Hearn might be right — or, at least, the data so far shows that most consumers tend to agree with him.
But there does appear to be one bright spot on the smartwatch horizon: A new study by The NPD Group, “Activity Trackers and Sports Report,” found that smartwatch use and purchases are growing “rapidly” among people that consider themselves highly active, although smartwatches still have not overtaken the activity tracker market. Activity trackers still outweigh smartwatches by more than two to one, according to the report.
“The activity tracker became the device of choice for the middle-aged consumer looking to get in better shape by starting an exercise routine. But that’s not where the story has to end,” said Eddie Hold, president of Connected Intelligence, which helped contribute to the report. “Claims that the smartwatch would lead to the death of the activity tracker have so far proved unfounded. With a longer battery life, activity trackers have a strong target audience and are continuing to evolve. That said, activity tracker companies must continue to broaden their portfolios to satisfy more exercise-focused consumers, combining specialist functions with generalist capabilities.”
The study found that the “gap” between smartwatches and activity trackers was “beginning to narrow” among the six different exercise groups profiled in the study. Runners were the only one of the six groups that actually owned and used more smartwatches than activity trackers, with 22 percent reporting that they ran on a “regular basis” versus 21 percent of activity tracker users.
“As smartwatches move out of the early adopter phase and become more mainstream, the focus on fitness-related activities has grown,” according to the study. “When asked how important health/fitness was, 17 percent of smartwatch users considered it a passion, as compared to 13 percent of activity tracker users.”
So, if the smartwatch has a future — and companies like Apple are praying that it does — maybe it’s with the uber-fit exercise junkies?