Mario's Corner - March 2018.  

Apple's Successful Apple Watch Strategy

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I am wearing on my wrist something I never thought I would use again - a watch!  This is not just any watch - it is an Apple Watch.  


Approximately ten years ago I bought one of the first iPhones on the market.  Shortly thereafter, I stopped wearing a watch, since I no longer had a use for it.  I could just look at my iPhone when I wanted to find out the time and I could schedule any alarms or timers on it.  And yet, here I am in 2017 using one. 


The story behind the Apple Watch is one of the most brilliant strategies of repositioning a product that was considered antiquated by most people, especially millennials, and one that I want to share.


When the first Apple Watch was launched in 2015, I, like most people, was unimpressed.  Although I run with my dogs on trails almost every day, at the time I used a Garmin Fenix watch to measure heart rate and distance via GPS.   I had been using a Garmin watch since 2005 and it fulfilled all my fitness needs.  I only used this watch when I went on runs or exercised, since it was rather bulky and uncomfortable on the wrist.  The Garmin was priced at $599.00 USD.  Most other people I know who like to exercise also used a Garmin watch, since we all considered it a "serious" fitness device.  In contrast, the Apple Watch, at $399 USD, did not measure heart rate or distance accurately when it was launched and needed to have the iPhone nearby at all times since it was just a conduit to access it.  Finally, the initial advertising showed a model using it to prepare for a marathon.  This person was obviously not a full-time athlete and lacked credibility in the use of these devices.  Needless to say, when tested by serious fitness people, the Apple Watch proved its deficiencies in this area.


Fast forward to the launch of the Apple Watch Series 3.  Today, most people I know have bought one and have on it their wrist 24 hours a day, only taking it off for a recharge, which can be accomplished in as little as twenty minutes.  So, what changed to create this reversal?  Let's examine four factors that influenced this change.  All of these were initiated by Apple and are brilliant moves by a company that continues to create and communicate incredible value for its users and its stockholders:


​1.  POSITIONING SERIES 3 AS A FITNESS AND HEALTH MEASUREMENT DEVICE -  Apple decided not only to add all of the Garmin features (heart rate, GPS, exercise metrics) but also has allowed application developers, such as AutoSleep (to measure amount and quality of time spent sleeping) and MapMyFitness (nutrition), to provide information to Apple's proprietary "Health" app.  This has allowed Apple to show users all their fitness and health metrics in a few simple screens anytime they want.  However, there is much more detailed information that the user can access if s/he desires.


2.  LIBERATING THE APPLE WATCH FROM THE IPHONE - By enabling the Apple Watch (Series 3 Cellular) to connect to the internet and to make/receive calls without having the iPhone nearby, it has freed it.  Although the user still needs to set it up via iPhone and many of the apps can be used only if one is carrying the iPhone, the Apple Watch can access music, receive and make calls, use GPS, and use Apple Pay to buy anything without having the iPhone nearby (or even if it is turned off).   In other words, users can go for a run and even go out for short periods of time and leave the iPhone home or turn it off if it runs low in battery, knowing that they are still connected.


3.  INTEGRATING GPS AND MAKING THE WATCH WATERPROOF - As I mentioned, when the Watch came out three years ago, it did not use GPS.  Instead, it relied on the iPhone to obtain this information.  By integrating it into the Watch, Apple made the GPS more accurate and allowed it to be freed from the iPhone.  The other improvement Apple made was to make it waterproof.  Although Apple states that the Watch is "water resistant" (probably for legal reasons), one can actually swim with it and submerge it for periods of time without ruining it.


4.  INTEGRATING SIRI - Apple has integrated Siri into the Watch so the user can schedule meetings, timers, dictate text messages, etc., by using just the voice, without having to type anything.  Although still limited by the apps configurations and the obvious limitations of a small interface window (the Watch itself), the tasks one can accomplish with it have expanded dramatically from the earlier versions by using the virtual assistant.


All of this would have been wasted if Apple had not communicated these improvements and changes.  However, Apple has done a great job of communicating the new value proposition and emphasizing the "fitness" aspect of the Watch.  It has also engaged with the medical community to educate consumers on these new benefits and to continue improving the product.


Although there are still many improvements that it can make (e.g., the battery life), Apple has done an outstanding job of improving not only the product but also the message and the communication strategy around it.  And, along the way, it has convinced many lapsed watch users to strap one on their wrist - again.


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Please do not hesitate to call me at 1 (617) 391-0347 or e-mail me at mariocastaneda@bluesailconsulting.com to talk about this or any other column.  I always like to hear from clients and readers.  


Also, please don't forget to read my interview with BostonVoyager magazine.  To read it, click here.

 

Please contact us if you want to find out how we can help you and your organization innovate and improve your product portfolio through our Blue Ocean Strategy framework.

 

I look forward to seeing you again here in April!

 

Warm Regards,

 

​Mario