At the end of last year I was asked by a technology publication for my 2015 predictions. My first was that consumer wearables would fail to gain traction despite there being a slew of new hardware. Barely a couple of weeks into the year and Google announced the demise (sort of) of Glass. CES was awash with wearables that failed to capture the imagination. The hope now is that the Apple Watch, which will certainly sell by the bucket load initially, will move the market on. But what will people really want from wearables and who is best placed to provide it?
A little bang for a lot of buck
The initial wave of wearables were use case specific, mainly related to exercise such as Fitbit. This made perfect sense. They served a particular market and did not ask the customer to replace anything that they already had. They were a price that someone wanting/needing that functionality was prepared to pay and their competition was another device doing the same thing, not established brands. That concept has now evolved into something far more complex and is supposedly for everyone.
The challenge for many of these new wearables is that they ask consumers to spend a significant amount of money on something that doesn’t really do that much. The obsession with health related apps (that even Apple seems to be jumping on) may be great for hypochondriacs but do most people really want to constantly know their current heart rate? Calorie intake? Number of steps they have walked? I very much doubt it.
Aside from health apps much of the functionality simply links to the mobile phone. As many people who have tried wearables will tell you they simply gave up wearing them after a few weeks. This is essentially because most features led them to take out their phone which they did regularly anyway. The wearable was just an additional unnecessary step.
Then there is the problem of battery life. The Apple Watch will last 18 hours at best which will likely mean that it won’t actually last the working day. By early evening your watch may not even be able to tell you the time. Apple make a big deal of their mobile payment capability but what good is this if I can’t pay for my journey home because the battery has died?
Where technology and fashion collide
A further challenge is that they look like technology attached to your body. As Glass demonstrated this is not an experience that most people want. Glasses and watches are fundamentally fashion items, not pieces of technology. People buy them because they either covet the brand or just want something to go with an outfit or reflect their personality. Google is not a covetable fashion brand and having a mini computer stuck to your face did not say anything good about your personality.
People say that this is where Apple will succeed. The Apple Watch is more attractive than what has gone before and Apple is a highly coveted brand. The problem is that the Apple Watch may be more beautiful than its smartwatch competitors but that’s not its true competition. The real competitors will be a diverse group of existing brands: At the high end TAG, Omega or Rolex; or at the lower end of the market brands like Swatch or low cost jewellery stores. At the same time Huawei and LG have acknowledged the aesthetic issue and launched watches that actually look like the watches that people buy. Perhaps even making those devices more appealing than Apple’s from that perspective.
Simply put fashion is a different market to technology with different buying criteria. For example, customers often buy a number of watches that can be worn for a while and then discarded for something new as fashions and moods change. This is not something that you can do when the watch costs hundreds of dollars. Yes, the Apple Watch allows you to change the strap but so does Swatch, and they are much (much) cheaper.
And here’s the kicker: some of these established watch brands (such as Swatch) are going to start adding smart functionality to their own products. Because the functionality of smartwatches is so basic it’s not particularly hard to do. TAG is rumoured to be releasing a watch with smart capabilities. Gucci and Swarovski are also supposedly lining up devices.
At Dreamforce last year Will.i.am reflected on this very issue when he released his (not a) watch. His aim was to approach the product as a fashion item first and a device second. Something that other companies spoke to me about at last year’s Mobile World Congress. Once established brands or high street names start pumping out fashionable items at low prices that will do most (if not all) of what Apple, Samsung, Motorola and others will do, where is the market for these technology vendors?
Watch this space
I do not mean to sound negative about wearables. I have no doubt that there is value in having some of these capabilities. My point is whether customers will want to pay high prices for pure tech products when they can buy fashion products that come with tech capabilities? This is the very argument that Huawei makes for its own Watch by trying to make it a “watch” first.
Let’s say Swatch offers one of their watches with smart functionality for $100 then why would one pay $349 (or $10,000!) for an Apple Watch? And if Swatch can make the battery last longer like the Pebble does then that’s potentially much more appealing to the average consumer. There is the option for the tech firms to make very low price products that compete at the low end of the market. Similar to the old digital watch market of the 80’s but I certainly do not see Apple doing that.
I don’t think that anything said here will come as a surprise to many, even Apple. Which is probably why Jonny Ive has been seen hanging around with the couture crowd despite what he might have to say about Swiss watches. Apple have also hired fashionistas Angela Ahrendts (Burberry), Patrick Pruniaux (Tag Heuer) and Paul Deneve (Yves Saint Laurent) I would not be surprised to see Apple do a deal with one or more of the established brands, similar to what they have done in the car industry with CarPlay.
As for Android and even Windows, it is very likely that their platforms will end up in devices by well-known fashion brands anyway. Last year I was shown a prototype watch for a major fashion house that ran Android.
The alternate markets for vendors
The alternate market for the tech vendors is in industrial use cases. In more recent times Google came to appreciate that Glass was of more interest to businesses for internal use than it was to consumers. There are numerous industrial scenarios where a wearable would be the perfect form factor to carry out a specific task.
Just consider Construction where people need their hands for holding tools or hanging on to ladders and so on. I certainly would not be surprised to see Glass re-appear in that type of scenario with Android and Windows well placed to find their way into such devices. It is in this space that custom built apps will prove more useful than in the consumer market. Thus making it more interesting to development teams and enterprise IT.
A final word on Oculus Rift and the recently announced Microsoft HoloLens. These are like Fitbit, devices for very specific use cases. In the case of Oculus this is gaming and for HoloLens there are probably a number of industrial applications. In the context of such niche scenarios I think that these types of devices from vendors will do well. Perhaps the more fashionable items should be left to those who know about fashion.