Apple Watch Remains a ‘Show Me’ Product, Despite the Hype

Source: Piper Jaffray

If Apple’s history of launching products in new categories is any indicator of future results, then its upcoming Apple Watch will likely be a resounding success. While it may seem hard to believe today, Apple was an underdog in the mobile phone market when it launched the iPhone in 2007. Similarly, many people wondered who would want an oversized iPhone when Apple unveiled the iPad in 2010. However, both products soon became the gold standard of devices in the smartphone and tablet markets, respectively. Will the Apple Watch do the same for the smartwatch market?

While Apple’s previous track record of products would seem to make the success of the Apple Watch a foregone conclusion, a recent survey commissioned by Piper Jaffray analysts Gene Munster and Douglas J. Clinton suggests that consumers are still taking a “wait-and-see” approach to the wrist-worn wearable tech device. In a research note released Monday, the analysts reported that only 7% of U.S. iPhone owners who were surveyed said they intended to buy an Apple Watch.

The results of the latest survey show a steady decline in the number of consumers interested in buying an Apple Watch. In survey conducted soon after the Apple Watch was unveiled at the company’s media event in September, 8% of U.S. iPhone owners said that they would purchase the device. As seen in the chart above, September’s survey results were also lower than the results of a survey conducted in September 2013, when 10% of iPhone owners reported that they intended to buy the Apple Watch.

Justin Sullivan/Getty Images

It should be pointed out that current iPhone owners are considered to be a group that is more likely to buy an Apple Watch over the general population, since the Apple Watch requires an iPhone to operate. Although another survey of customers waiting to buy the latest iPhone 6 and iPhone 6 Plus models on launch day found that 34% planned to buy an Apple Watch, the Piper Jaffray analysts wrote that early adopters are naturally more inclined to embrace new products. So why are many of Apple’s users still not sure about the Apple Watch?

Although Apple is always secretive about a new product while it is still under development, customers can usually count on getting plenty of information about a new product once it has been unveiled. Apple also typically releases a new product a week or two after it has been unveiled (the original iPhone being a major exception), so any questions interested customers may have about a product can soon be answered via third-party reviews or through a hands-on experience at an Apple Store.

In this respect, Apple broke with tradition when it unveiled the Apple Watch at its media event in September. Not only did Apple not provide a full rundown of the device’s functions and features, but the company also declined to reveal how much the Apple Watch would cost beyond a $349 price tag for the entry-level model. Apple also refused to announce a specific release date for the Watch, only stating that it would be available in “early 2015.”

Source: Apple

While Apple has since revealed additional information about the Apple Watch’s applications and functions through occasional webpage updates, important details like the device’s expected battery life remain unknown. As noted by Munster and Douglas, unanswered questions about the Apple Watch’s applications and its “killer feature” have likely contributed to customers’ muted response to the upcoming product. However, the analysts remain bullish on the Apple Watch and expect demand for the product to increase as more information is revealed.

While Piper Jaffray’s survey indicated that there are a limited number of iPhone owners who are currently interested in buying the Apple Watch, other surveys have hinted at the potential success of the product. For example, a recent consumer survey conducted by independent market research company Ipsos claimed that 62% of consumers said that they would consider buying an Apple wearable based on the company’s reputation for creating reliable products that seamlessly integrate with other devices.

So when can consumers expect to get their hands on an Apple Watch? According to a recent rumor reported by French Apple news site IGen.fr, the Apple Watch may be released on Valentine’s Day (February 14) next year. However, the Piper Jaffray analysts believe that the wearable tech device will likely make its debut in June, with an average selling price of $500.

Follow Nathanael on Twitter @ArnoldEtan_WSCS

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