Apple Watch became available for pre-order on Friday, and this is generating tons of speculation about how many devices Apple (NASDAQ: AAPL) will sell right from the start. However, what really matters to investors over the long term is not the sales number over a short period of time, but Apple's ability to continue creating innovative game-changing products in different categories.
Let's look at a few important areas that could determine if Apple Watch is in fact a disruptive new product offering, thus generating further revenue growth for Apple in the years ahead, or just niche gadget for Apple fans and tech geeks.
Apple Watch needs to be cool
Functionality is undeniably very important, but few people will buy an Apple Watch unless it looks and feels cool. Wall Street analysts tend to downplay this factor, focusing instead on tech specifications and other forms of measurable data. However, this can be a major mistake when it comes to Apple, which has achieved extraordinary success over the years thanks to its distinguished designs and brand differentiation.
Coolness is not only about external image or aesthetics: Scientific research is proving that cool products and experiences -- whatever coolness means to you -- can make you feel more than just satisfaction, they you feel happier about yourself.
A watch is a particularly personal product, and Apple Watch represents the tech giant's formal entry into the fashion industry. That means design is now more important than ever, and the company is well aware of this.
Apple is putting enormous amounts of attention into detail and design. The animated flowers, butterflies, and jellyfish seen on the face of Apple Watch were not created with computer graphics; they were instead photographed in a thorough process that sometimes required more than a week to capture a single image. The flowers were shot blooming over time, and the longest one required nearly 285 hours and more than 24,000 shots.
A watch to save time
Apple Watch must be paired with an iPhone, so one of the main negative critiques is that the product is redundant, since many of the things you can do with an Apple Watch can also be done with an iPhone. However, this misses the main point: It's not only about doing different things, but about doing the same things in a better way.
Farhad Manjoo, from The New York Times, wrote an interesting review arguing how this can be a real game changer for consumers:
By notifying me of digital events as soon as they happened, and letting me act on them instantly, without having to fumble for my phone, the Watch became something like a natural extension of my body -- a direct link, in a way that I've never felt before, from the digital world to my brain. The effect was so powerful that people who've previously commented on my addiction to my smartphone started noticing a change in my behavior; my wife told me that I seemed to be getting lost in my phone less than in the past. She found that a blessing.
Matthew Panzarino offered a similar point of view in his Apple Watch review for TechCrunch:
People that have worn the Watch say that they take their phones out of their pockets far, far less than they used to. A simple tap to reply or glance on the wrist or dictation is a massively different interaction model than pulling out an iPhone, unlocking it and being pulled into its merciless vortex of attention suck.
If you argue the Watch isn't going to sell or do well, it's worth pointing out that there are very, very, very few products that allow you to hand someone cash and be given back TIME.
Apple doesn't just sell products; the company is in the business of providing experiences embedded in those products. If Apple Watch can provide a customer experience that is superior to smartphones, then it will be major win for Apple.
Massive healthcare benefits
Apple Watch includes an activity tracker that monitors variables such calorie expenditure, exercise, and the number of times you stand during the day. It also has a workout function to keep records of different fitness activities. The product could be a big success when it comes to fitness applications, and Nike (NYSE:NKE) has already announced its new Nike+ app for Apple Watch.
Apple Watch sensors also collect and supply apps with real-time data on physiological functions such as pulse and blood pressure, and users can incorporate factors such as height and weight into the health app for a more complete picture of their personal health?.
The benefits when it comes to preventive healthcare could be truly extraordinary, even if it will take some time to clear regulatory hurdles and establish data reliability. Over time, having an Apple Watch could even reduce your health insurance costs.
Preventive healthcare and diagnostic health benefits could turn Apple Watch into much more than just another tech gadget. If successful in this area, Apple Watch could become a must-have device, almost a necessity for many people.