Will the Watch be Apple's biggest success, or biggest challenge yet?

The global launch of Apple's smart watch is now only days away. In case you missed the news, the first deliveries of pre-ordered devices are set to arrive from April 24 in nine countries, including France, Germany and the UK. Estimates on sales vary widely, with latest figures from analyst Carl Howe of the Think Big Academy predicting that Apple will ship 3.1 million units between the launch date and May 8, to yield it revenue of over $2 billion (€1.8 billion) in the first two weeks of sales.

Howe also suggests that the Apple Watch product line "will become Apple's most profitable product line ever, with gross margins exceeding 60 per cent. Why? Because the core electronics modules in the expensive models are the same ones used in the Sport models, and they just don't cost that much."

As is always the case with predictions, Howe warns that his are merely a guess. He adds that he places "a great deal of uncertainty in that figure".

His statement that the Watch could become Apple's most successful product line to date certainly sits alongside column inches that question why anyone would want to pay so much money for such a device. It is not easy to predict whether the Watch will be Apple's biggest success, or biggest challenge.

UK-based research company GfK has just issued some insights into how consumers feel about the Watch. Key findings are that awareness of the launch is high, but there is confusion over what a smart watch can do. Expectations of the price point are also some way out, GfK added.

Indeed, when it comes to cost, the GfK research suggests price may well be a sticking point for Apple. The majority (73 per cent) of people interested in the launch of the Apple Watch say they are prepared to spend up to £299 (€415/$448), which is the price of the small sports version of the smart watch in the UK. Around 17 per cent are prepared to spend between £300-£399, and one in ten (10 per cent) are prepared to pay £400 or more--closer to the £479 price tag of the basic standard Apple smart watch.

"Looking at these figures, it would appear that people who are interested in the launch of the Apple smart watch don't expect it to be priced as highly as it is," observed Anne Giulianotti, joint head of technology at GfK.

Giulianotti also noted that Apple is a "master" at creating desirable new personal tech devices, and indeed entire categories. For sure, the ability of the U.S.-based company to generate demand can never be under-estimated.

However, Giulianotti said that gaining mass appeal for the smart watch might be Apple's greatest challenge yet.

"The high price point and lack of clarity around smart watch benefits generally mean that this wearable technology will have to provide an outstanding experience if its sales performance is to come close to that of the iPad or iPhone," Giulianotti concluded.-Anne

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