You’ve probably seen it spattered all over town, the Apple Watch is dying, sales are down 90%, its a flop. It’s based on data from a service called Slice, but there’s a lot more story on how these stories used that data. 99% of a story is context and those figures are way out of context.
According to data MacRumors was able to obtain from Slice, Apple sold roughly $3 million Apple Watches through July 10th. To put this in perspective, the original Pebble old 1 million watches in just over two years and there were roughly 750,000 Android Wear devices its first year on the market. This is despite the average Apple Watch having a much higher average price tag than either of these devices.
Apple’s sales were highest during the launch and have tapered off since then. I don’t doubt Slice’s data, but there are some facts that need to be considered. First off, as MacRumors point out, Slice’s data is based almost exclusively on Apple Store online sales in the US. It does not include most International Sales and it does not include In-Store sales. Sales figures are further constricted by availability. The initial launch was so taxing on the supply chain that Apple did not have enough supply to launch the Apple Watch in its own stores or expand to other countries until late June.
As of today, while you can get a Fitbit, Pebble, or Android wear device in almost any population center in the US larger than 50,000 people, you can’t buy an Apple Watch at any third party retailer. If customers can’t get their hands on a product at a retailer, quite literally with a wrist worn device, they cannot buy it. High traffic as Apple Stores are, big box retailers such as Best Buy, Wal-Mart, and Target (and their global counterparts) as well as carrier stores are a major part of a product’s sales volume. One more thing… we have no direct data from Apple on Apple Watch sales.
However there are some valid points in some arguments against the Apple Watch. In its current form with watchOS 1.0, it is very much a 1.0 product. Features don’t work as well as they should and Apple didn’t give developers the full deck to play with. Apps, in particular were run through the companion iPhone and didn’t have access to the watch’s sensors like they needed. That changes in watchOS 2 which will presumably launch before the holiday quarter. There’s more features, native apps that run on the watch, and the apps get full access to hardware. In other words, Apple’s getting the kinks out now when sales don’t matter as much as they would in late October, November, and December when you would assume the majority of Apple Watch sales would take place.
The Apple Watch is a victim of Apple’s success. People don’t remember when the iPhone 1 launched with 4 apps or when the iPod only had firewire. Even the iPad struggled its first go around and that was with a more mature version of iOS behind it. They expect a mature, fully developed product out of the gate and that creates a bias. It also creates a lot of hits when you mention Apple in a headline, especially in the negative sense.
So here are the key facts of the situation
- Apple has sold over 3 million Apple Watches.
- There has been a decline in those sales since launch.
- Apple has had severe issues with availability.
- The Apple Watch has only been in Apple’s own stores for a couple weeks.
- Apple Watch has only appeared in additional countries the last few weeks.
- The Apple Watch appears in no third party retailers in the US.
- The Apple Watch is a recently released and immature platform
- The Apple Watch software is getting a major update in the fall.
- the Apple Watch has not seen a holiday quarter.
The most important two:
- Slice does not include most international sales nor walk-in sales
- We have absolutely no data from Apple.