My Thoughts on Technology and Jamaica: U.S. wristwatch sales in June 2015 dip due to Apple Watch - Why Apple Watch heralds Armageddon for U.S. and Swiss Watchmakers

Sunday, August 9, 2015

U.S. wristwatch sales in June 2015 dip due to Apple Watch - Why Apple Watch heralds Armageddon for U.S. and Swiss Watchmakers

“The Apple Watch is going to gain a significant amount of penetration. The first couple of years will be difficult for watches in fashion categories”

Director of NPD Group’s luxury division, Fred Levin, in an interview with Bloomberg discussing the June 2015 declined in U.S. Wristwatch sales

Looks like the Apple Watch is just too perfect for its own good!

According to the latest stats from market research firm NPD Group, U.S. wristwatch sales have dropped by 14% in June 2015 as reported in the article “The Apple Watch effect? Traditional watch sales drop 14 percent in June”, published Aug 8, 2015 by Nick Mediati, MacWorld.

The Sales declines in June 2015 were as follows:

1.      US$50 and US$999 registered the largest declines
2.      24% decline in the number of US$100 to US$149.99 wristwatches sold
3.      US$375 million in sales
4.      11% drop in Sales Profits from U.S. Wristwatches

This is of course when compared to the sales of U.S. wristwatches in June 2014, making this the lowest year-on-year drop in wristwatch history since 2008, or seven (7) years ago as noted in “Apple Watch Killing Watchmakers? US Wristwatch Sales See Biggest Decline In 7 Years”, published August 07 2015 By Mike Brown, International Business Times.

It affects mainly low-end brands such as Timex, Guess, Burberry and Tissot as noted in the article “The Apple Watch has drastically lowered sales of this product”, published AUGUST 7, 2015 by Benjamin Snyder, Fortune.  But as the details roll in, the deep impact may only just be a foreshadowing of Christmas 2015.

Sales of U.S. Watch Export to Switzerland also affected - Apple Watch may be the culprit

When the data is broken down in terms of pricing tiers, it appears some sections of the U.S. wristwatch market took a bigger hit than expected according to the article “Apple Helps Push U.S. Watch Sales to Biggest Drop in Seven Years”, published August 7, 2015  by Thomas Mulier, Bloomberg.

But it gets worse.

U.S. wristwatch exports to Switzerland have been on the rise for months from 2014 to 2015 except in May 2015 based on information supplied by Federation of the Swiss Watch Industry. 

Overall for the first six months of 2015, the increase was 4.2%, with the unexpected decline in May coming as a shock, as this exactly two (2) month after deliveries of the Apple Watch began on Friday April 24th 2015 as reported in my blog article entitled “Apple Watch delays on Pre-Order Day – How to Sell a Wearable using Apple Watch Edition on Celebrities and Third Party Wristbands”.

So is it really the Apple Watch causing the drop in the traditional U.S. wristwatch domestic sales and exports? Possibly…..

Apple Watch vs U.S. wristwatch sales – Why Apple Watch may herald the death of U.S. Watches

It's possible, but highly unlikely, as even I, an Apple fan for years, find it a little hard to accept that the Apple Watch sales are that strong.

After all, other lower-priced brands are also having a rough Summer, possibly because the focus in on buying back-to-school items instead of purchasing that matching Burberry mittens and hat to go with those shoes.

So maybe that focus is causing a dip in sales of wristwatches in a sort of combined effect with the Apple Watch i.e. more noticeable due to the stronger pull of Apple’s latest shiny toy!

To date Apple has not published any official numbers on Apple Watch sales, even though they recently announced 11 million free trial subscribers to Apple Music as noted in my blog article entitled “Apple Music 11 Million Trial users – Why 100 million Apple Music Subscribers by 2016 versus @Spotify and @TIDALHiFi beckons”.

But this hasn't stopped Research Analyst Slice Intelligence from stating that some 3 million Apple Watches have been sold in the past two (2) months up until June 2015 as explained in my blog article entitled “3 million sold according to Slice Intelligence - How Third-party Wrist straps sell Apple Watch demonstrating How to Sell a Wearable”. 

More recent stats from Research Analyst Slice Intelligence suggest sales of the Apple Watch in terms of US online sales have surpassed 3 million since Friday July 10th 2015 as pointed out in the article “3 Million: Estimated Sales Of Apple Watch Through July 10”, published July 13, 2015 By Sumit Passary, Tech Times.

That means if you add in international sales, the Apple Watch would have long surpassed 3 million abroad.

It would have already beaten Google Android Wear smartwatches and all other Wearables combined as predicted in my blog article entitled “Apple Watch is Apple Most Successful Product – How to sell a Wearable and beat fitness Trackers and Android Wear Smartwatches”.  

Worse, with the decline in exports to Switzerland, it might already be beating the Swiss in their own home turf, at least in the sub-US$1000 category. The US$10,000 and higher category remains tantalizingly out of reach for Apple, as they’re new to the Luxury game and at US$10,000, the Apple Watch Edition seems tame.

Apple Watch Armageddon – Swiss watchmakers Legacy undone in 1 year

So are we looking at a Smartwatch Armageddon for U.S. wristwatches?

Is Apple Watch's mojo THAT powerful an explosive force, like the Russian Tsar Bomba that it might kill off domestic wristwatch sales?

And is the Swiss Watchmakers four hundred (400) years dominance over these custom crafted mechanical timepieces coming to an end as the Age of the Smartwatch beckons?

We'll only know when Apple reveals sales numbers, hopefully by Wednesday September 9th 2015, then they allegedly will launch both the Apple iPad and the Apple iPhone as reported in “Apple said to host iPhone, iPad, Apple TV event Sept. 9”, published August 7, 2015 by Shara Tibken, CNET News, and plot a course for Apple Watch domination in 2016.

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