A Deep Dive into the US Watch Market and Apple Watch Release

Vice President, Consumer Insights Products

Though it just hit the market, the Apple Watch is already a huge success by traditional standards. In just one day, Apple became the leader in smart watch sales online, selling more units on April 10 than all other smart watches combined for all of Q1 2015.  Using a U.S panel of 5 million active internet users, we conducted an analysis of the watch market and Apple’s release.

An Overview of the Watch Market

According to 1010data's Ecom Insights online shopper panel, prior to the Apple Watch release, smart watches currently make up 8% of online watch unit sales, up from 2.5% at the same time last year (a more than 3x jump)

There’s been widespread speculation that traditional brands are already feeling the heat from competing against Apple. The watch market is highly fragmented with most watch brands representing less than 5% share of sales. Entry level brand leaders like Timex, Casio, and Seiko run a greater risk of losing business to the Apple Watch than high-end brands, whose brand value is derived from age and craftsmanship.

However, despite overall segment growth, top smart watch brands have not received the same online consumer interest as traditional watch brands prior to the Apple Watch release. In the last year, there’s been minimal spikes in consumer interest in smart watch brands like Pebble and Samsung compared to traditional entry and mid- level brands. The one exception being back in September 2014, when Motorola released the Moto360. 

Apple Watch Success

We all know the Apple Watch isn’t just about being a smart watch or being a watch at all.  Apple doesn’t enter markets, they create markets. For some, Apple is almost a religion and that comes with a lot of expectations and hype. The original 2007 iPhone sold only 270k1 units worldwide at launch which stands in stark contrast to the nearly 4 million2 units sold last year at launch. This suggests that this is only the start for the Apple Watch and there’s significant momentum to grow penetration.

Taking a deeper dive into Apple Watch purchases from the pre-release. Interest in Apple Watches was heavily concentrated in the Regular and Sport watch lines which feature significantly lower price points than the Apple Edition. Even so, at a jaw-dropping $10,000 MSRP, we estimate the Apple Watch Edition still accounted for almost 15% of sales.

Post release, Apple Watch is still the clear leader in consumer interest, blowing away nearly every other smart watch brand in terms of product views. However, it remains to be seen whether Apple can maintain strong momentum in driving consumer interest going forward.

Our analysis indicates that most of the viewed Motorola watches were Moto 360’s for Android Devices which suggest that shoppers with Android phones wanted to see what their options were to own a smart watch given the restrictions of the Apple Watch to the iPhone.

The benefits of the Apple Watch still aren't well understood, just like the original iPhone eight years ago so it will take time to see how far it will grow into mainstream consumer use.

1) Apple Q3 2007 Financial Results

2) Apple.com, “Apple Announces Record Pre-orders for iPhone 6 & iPhone 6 Plus Top Four Million in First 24 Hours”

1010data Ecom Data Methodology

For the Apple Watch analysis, 1010data analyzed the online watch and smart watch purchase activity of 5 million panelists for 2014 and 2015 YTD. Watch sales were analyzed on top online mass merchants in the U.S. only, which make up more than 95% of online shopping activity. 1010data employs a rigorous and proprietary data methodology to ensure that its panel is representative of the Internet Browsing Population (IBP). 1010data's Ecom Insights product helps brands gain detailed competitive insight into online shopping activity. For more information about how 1010data Ecom Insights can increase your online sales, email ecomsupport@1010data.com.