Apple has been on a roll for the last decade or so — everything it releases seems to be a smash hit, even when the initial reaction is pessimistic. No one talks about the iPad having a goofy name or the iPhone getting all fingerprint-y anymore. These products changed the market for personal computing, but what about the Apple Watch? Data collected by Slice Intelligence shows Apple Watch sales dropping off a cliff. Could this be an old-fashioned Apple flop in the making?
Apple tends not to release sales figures on its products, and when it does they’re very positive general figures on a flashy keynote slide. The numbers from Slice are unofficial, but based on real data collected from users. Slice Intelligence produces a popular app called Slice, which can scan your email for shipping and tracking information. It uses this to keep you updated on where your packages are. The app is free, but by using it you agree to let Slice collect and aggregate data on what you are buying. This gives the company a healthy cross-section of smartphone-equipped consumers, which are of course the only consumers who can use the Apple Watch.
Based on that data, Slice says Apple Watch sales fell significantly after the initial rush — more than 90% from the peak. Most days, Apple is moving under 20,000 Apple Watches, which is very low volume for an Apple product. In recent days, the numbers are even lower — under 10,000 units. The overall sales are probably in the neighborhood of 1.5 million watches.
Perhaps more troubling for Apple, consumers aren’t going for the pricey upgrades. About two-thirds of all Apple Watch sales are for the cheapest “Sport” variant, which starts at $349. The next step up starts at $549, which is into full-price flagship smartphone territory. As for that ridiculous gold Apple Watch Edition that starts at $10,000, Slice says Apple has moved about 2,000 of those devices in the US. Frankly, I’m a little surprised it’s that many.
So does this spell doom for Apple? Even if the Watch is a certified flop, Apple isn’t going to be hurting for cash as watch sales are a tiny part of the business. The time and money that went into designing the Apple Watch will probably sting more if it doesn’t take off. Apple is used to making high-margin hardware, but people might just not be interested in spending that kind of money on a smartwatch, at least not yet.
The price is certainly an issue, but this may be more of a wearables problem than an Apple problem. Android Wear, which encompases multiple devices, hasn’t sold any better than the Apple Watch, and it’s been out for a year now. Apple isn’t likely to give up on the Apple Watch any time soon — if wearables do take off in the future, Apple will want to be ready.
