A $17,000 model. A fitting appointment. A cover spread on Vogue. The Apple Watch was more than a fitness tracking device when it debuted five years ago. It was a fashion item and status symbol. It was luxury on your wrist.
Fast forward to 2020, the fifth anniversary of Apple’s smartwatch. Millions of people around the globe wear Apple Watches to remind them to stand during meetings, take time to breathe and get in one last workout for the day. Once a fashion accessory, the Apple Watch is now an essential tool for health and fitness.
The ubiquity of the Apple Watch doesn’t mean it’s lost its appeal to the fashion conscious. Last year, the Apple Watch outsold the entire Swiss watch industry by a huge margin, according to Strategy Analytics. Apple shipped an estimated 31 million units in 2019, while all Swiss watch brands combined shipped 21 million, the research firm said. (Apple doesn’t detail how many watches it sells each year but said it generated $24.5 billion in revenue in its latest fiscal year from its category that includes Apple Watch and AirPods. That was a 41% jump from fiscal 2018.)
“Swiss companies, like Swatch, are losing the smartwatch wars,” Strategy Analytics said.
They aren’t alone. When the Apple watch came out five years ago, every major company in tech, and a lot of new startups, seemed to be making a watch or fitness band. The list included Samsung, Sony, Fitbit, Pebble, Misfit, Jawbone and various other companies. Some of them, like Samsung, still sell smartwatches, but others, like Pebble, were acquired or have gone out of business. And the Swiss watch brands, some of which are trying to go digital, are struggling to compete.
“The window for Swiss watch brands to make an impact in smartwatches is closing,” analyst Steven Waltzer said. “Time may be running out for Swatch, Tissot, TAG Heuer, and others.”
For Apple, the watch has turned into one of its most successful products, even though the business is nowhere near the size of its hugely popular iPhone. The Apple Watch still requires Apple’s smartphone to run, with limited functionality on its own. And it has more to do when it comes to becoming a standalone health tracker. Still, Apple managed to do what seemed nearly impossible five years ago: find another hit product.
High stakes
With Apple’s huge position in smartwatch sales today, it’s easy to forget how it all started. When the company unveiled the first Apple Watch in September 2014, success wasn’t guaranteed. The device wouldn’t hit consumer wrists for seven months, which gave nimble rivals time to respond. It wasn’t clear why anyone actually needed a smartwatch, or what it’d do once they got one.
For Apple CEO Tim Cook, the Apple Watch was a major test. He needed to show that his company could still create lust-worthy, must-have products in new categories without Steve Jobs at the helm. Apple’s last totally new, hit product was 2010’s iPad, which was ushered to market by Jobs before he died the following year.
When introducing the first Apple Watch, Cook called it a “breakthrough” product and described it as a “comprehensive” health and fitness device, walkie-talkie, remote control for the Apple TV streaming-box, among many other capabilities.
The device is “the most personal device we’ve ever created,” he said at the time. “Because you wear it, we invented new intimate ways to connect and communicate directly from your wrist.”
