Apple Watch and New Market Disruption

Some early thoughts on the new Apple Watch:

  • Apple Watch is a new market disruption because: (1) it drives non-consuming, non-watch wearers to wear a watch (I'm starting to sound like Dr. Seuss!); and (2) permits intimate, discreet computing/communication in new, more convenient situations. See Concepts page and discussion of Clayton Christensen. Because it's a miniature computer and communication device (non-traditional performance attributes/measures), it doesn't really compete with traditional watches, and other smartwatches are much more limited (and without widespread adoption). So it doesn't directly compete against the consumption of alternative/comparable products, which bodes well for its ability to steadily grow an entirely new market (just like the original iPhone did). See Concepts page and discussion of Clayton Christensen; post titled "The iPhone Conundrum and New Market Disruption." 
  • Based on Dieter Rams's ten principles of good design, the market appeal of Apple Watch depends mainly on the product's usefulness, and usefulness hinges on how well the Apple Watch solves jobs-to-be-done. See Concepts page and discussion of Clayton Christensen; posts titled "Product Aesthetics and Jobs-to-be-Done" and "Apple's Design Strength Prevents Overserving." If usefulness is high enough, this will probably compensate for possible shortcomings like battery life.
  • Apple Watch and iPhone are very personal products where aesthetics and user experience are never really good enough (as previously noted by Ben Thompson at stratechery.com). With highly personal products used every day, aesthetics are a key part of a product's usefulness, since the aesthetics of products used every day impact a person's well-being. One of the jobs of a highly personal product used every day is to positively impact a person's well-being. See post titled "Product Aesthetics and Jobs-to-be-Done." Subjective factors like aesthetics and user experience make technical performance measures less relevant, making it much harder for a highly personal product to ever be "good enough." This means Apple has less exposure to the innovator's dilemma described by Christensen. See Concepts page and discussion of Clayton Christensen.
  • Retail stores are essential to the Apple Watch's success, and are a key part of Apple's competitive advantage relative to competitors. Because it's worn on the body, Apple Watch is a more personal product than the iPhone. The more personal the product, the more individual taste and product feel/look/aesthetics matter, which make the consumer's ability to try out and customize the product more important.
  • With the iPhone and Apple Watch app customization is critical because it allows these products to solve different jobs-to-be-done depending on each customer's needs, which enhances device usefulness. The challenge is to make a highly personal device customizable yet simple and easy to use -- customization has to be balanced against ease of use.

The author owns stock shares of Apple.