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Apple was smart not to compete on the low-end for watches. Median income in the USA is $68,703. Why would someone spend 1/25 of 1 percent of their income on s

• bhupy 6y ago
  > Median income in the USA is $68,703. Be that as it may, there's absolutely a non-trivial amount of revenue available at the low end of the market. Apple historically never participates in that market, but that's an opportunity for other hardware providers.
  • bluGill 6y ago
    In fact if you get "good enough" at the low end there is more money there than up top. Sure $200 isn't much compared to me income, but it is still more than an impulse buy. If you can get the $20 market it becomes an impulse buy for a lot more people. If you are good enough they compare with their friends and the friends also buy - those who would never spend $200 on an impulse buy, and those who already have and are looking to replace theirs.
    • treesknees 6y ago
      The low price of $20 actually slows my impulse to buy it. Sure, it's not a lot of money, but how reliable or usable can it be for that price? It makes me think of a cheap knock-off device I'd find at a TJ Maxx store on clearance. What makes it so cheap even compared to a Fitbit?
      • bhupy 6y ago
        You might be right, but the current price point of watches could also be inflated. Let's not forget that once upon a time, pocket-watches were only for the rich. It wasn't until the advent of quartz watches that you could find a solid watch (digital or analog) for under $100. Today, $20ish digital watches are fairly common on the market. One of my favorite watches is a cheap Timex Weekender (a favorite of /r/malefashionadvice IIRC). Just like one might decide to go for a stylish (but cheap) quartz watch instead of that expensive automatic, one could decide to go for a stylish (but cheap) Wyze watch instead of that $300 Apple Watch. We'll have to see if Wyze (or someone similar) can actually execute and pull that off.
  • ghaff 6y ago
    Yeah, I have an Apple Watch but I usually just wear a $30 Timex because I don't need to worry about charging. When the band and/or battery give out after a few years I replace it with another of the same model. I buy lots of cheap things even though there are "better" versions available for more money.
    • dharmab 6y ago
      I’m so used to the fuggeaboutit reliability of my digital and automatic watches that the battery life of the Apple Watch is absolutely appalling.
• BostonEnginerd 6y ago
  We had a terrible experience with Fitbit. My wife’s Versa delaminated just out of warranty. Screen and guts all fell out. Fitbit basically shrugged their shoulders and said too bad. My experience with them years ago when they first launched was really positive. Any issues with a device, and another one was in the mail.
  • qppo 6y ago
    Plus they managed to run the gamut of security failures including RCE on users home computers.
  • breck 6y ago
    Yeah I've had a number break on me (not the versa, but ionics and charges) and they've usually replaced them (but not always). I consider it still "early adopter" territory and am happy to put up with some problems as they blaze a trail to a healthier world via massively increasing the amount of health data available.
• bigtones 6y ago
  That $68,703 figure is the median HOUSEHOLD income that encompasses more than one bread winner on average.
  • breck 6y ago
    That's a clear nit. I'll just give you that point and say 2/25 of 1%, and the argument is exactly the same.
• deleted 6y ago
  [deleted]
• securingsincity 6y ago
  How much of that income is spent on healthcare, food, and housing? 40% americans can't afford an unexpected $400 bill [0] https://abcnews.go.com/US/10-americans-struggle-cover-400-emergency-expense-federal/story?id=63253846#:~:text=Almost%2040%25%20of%20American%20adults,a%20Federal%20Reserve%20survey%20finds https://abcnews.go.com/US/10-americans-struggle-cover-400-em....
  • breck 6y ago
    $200 spent on a FitBit will save thousands on annual healthcare bills.
    • calebegg 6y ago
      [citation needed]
      • breck 6y ago
        https://scholar.google.com/scholar?q=fitbit https://scholar.google.com/scholar?q=fitbit Betting against this trend would be like betting against toothbrushes and floss.
        • Dylan16807 6y ago
          I'm not saying it's not useful, but I doubt the typical user is going to save all that much money. Unless a fitbit convinces my insurance company to drop their rates in half, I'm not saving thousands. If I google insurance savings I see... they'll get me a moderate discount on the fitbit itself.
      • joshuamarksmith 6y ago
        There's entire companies built around this data. In fact, one of my former employees partnered with one and paid for my FitBit. In the aggregate, FitBit purchases will drive down the probability of healthcare claims, saving the company money overall.
    • 6y ago
• foolmeonce 6y ago
  How swatch got started may be able to answer your question. Similarly, 13 year olds don't have a thousands in disposable income but are often the primary demographic to make a fortune selling $10 items. Someone who can afford crap is useless if they can recognize it.
• jariel 6y ago
  Except nobody actually thinks this way, so there's that. $300-400 is a high ticket item, point blank. Aside from Apple, the world is owned by entities that compete mostly on price.
  • breck 6y ago
    > Except nobody actually thinks this way, so there's that. I won't argue with that, especially in 2020 :).
  • xsmasher 6y ago
    I recall an interview where the palmpilot folks opined that $300 was the magic price point where someone could still make a purchase without consulting their spouse. Obviously there's strong middle-class bias built into that number, but I don't feel like it has moved much in decades.
• neilparikh 6y ago
  The problem is, aiming to create a "high-end" product up front ends up shaping the product design. Now that it is aimed at the high end, Apple needs to include lots of features, a nice display etc. Lots fancy features means they need to use a powerful processor, which along with the nice display leads to a lot of power draw. This is why they have a small battery life, as you mention, and didn't even have an always on display until S5. Neither of these are technological constraints, since the Pebble had 7 day battery life with an always on display from the first version. Now, the Apple Watch has sold well, so maybe it's a fine tradeoff to make. But I think this "high-end" constraint has definitely shaped the product (and in a way I think is worse when viewed as a watch first).
• jcrawfordor 6y ago
  Here's one perspective: about five years ago I stopped buying expensive phones. Now I buy economy Motorolas, and I've never looked back. The performance is somewhat worse than a flagship phone, but I damage my phones pretty frequently and I'm so much less worried about it when the replacement cost is $200 rather than $900. Price has been a main barrier to my wearing a smart watch as my expectation is that something on my wrist will get damaged even more often - I do a lot of mechanical work. Certainly my $15 Casio is pretty scratched up. At the $20 price point, though, I might give this a try.
  • breck 6y ago
    It's a reasonable perspective, and one a lot of my friends share. I guess I look at value/cost. I drive a $2,000 car and use a $1,000 phone because I get a lot of value for the extra $500 in the phone, but wouldn't get more value out of having a nicer car. Like you, I also find it nice to worry less about the car because the replacement cost is low. But I view the value of smart watches in the $100,000+s if not $1M+s. How much is your health worth? How much is it worth to passively keep an eye on your heart rate, and stress levels, and oxygen levels, and sleep levels? Granted, I still think it is very early for smart watches, and the value we are getting now is ~1% of the value we will be getting from them in 5-10 years (if they aren't replaced by a "smart tooth" or "smart necklace" etc). But I think at this point the value is definitely there and easily worth 10x+ the cost. Making a single actionable decision based on data received from a wearable could have a life changing impact. And again, speaking in probabilities here, and it depends if you look at the data and adjust your life based on it, but I think expected value of these is huge, and probably the best single health measure anyone can take. I would say try the cheap one, and think about upgrading if you like it.
    • antasvara 6y ago
      I think your last line is key to why a low price is a good idea. As someone who did a lot of research before buying my first smartwatch, I found it difficult to actually estimate how much benefit I would get from owning a smartwatch. What this essentially does is lower the barrier of entry. Now, a prospective buyer doesn't have to see much benefit to take a chance on buying the product.
• driverdan 6y ago
  > Why would someone spend 1/25 of 1 percent of their income on something that they wear 100% of the time? That makes no sense. If the product fulfills their needs why would they waste an extra $180 on a different product?
• schwartzworld 6y ago
  > I shell out $200-$300 each year for the latest FitBit Why would you update your Fitbit that often? Is it really that much of a difference from year to year?
  • breck 6y ago
    Sometimes I'll go 2 years without upgrading. Certainly the difference every 2 years is enough to warrant it. It seems there's a new sensor for measuring a new dimension at least every 2 years. But I also put these things through the wringer (lots of physical activity, including salt water ocean adventures). I wear them 24/7, so it's literally the thing I use most in the world.
• robocat 6y ago
  Here’s the income distribution per household from the last census: https://www.census.gov/content/dam/Census/library/visualizations/2015/demo/hh-inc-dist.pdf https://www.census.gov/content/dam/Census/library/visualizat... There are a lot of people that can’t spend $200 on a watch, but can spend $20.
  • breck 6y ago
    That's a good point. U.S. per capita healthcare spending is $11,172. If the U.S. gave everyone a $200 a year tax credit to spend on a smart health watch, we'd probably save $2,000 a year per capita and get a 10x ROI.
    • robocat 6y ago
      Most healthcare costs are at the end of our life, and we all die and often spend all we have, so the costs are fairly invariant i.e. you can never “save” $2k. The ROI for better health is very odd to measure. If you use dollars (for an economy) then the best ROI is to spend nothing once someone is of no economic benefit (i.e. the vast majority of healthcare spending is on the elderly and provides no dollar benefit to society, so economically most healthcare spending should be drastically cut). You could also look at an integral of quality of life over time. However “past me” is really bad at caring about “future me”, and “current me” doesn’t care at all about optimising for “past me”. Most people seem happy to argue that the amount that society should spend on them (or their loved ones) for health services is infinite (you can’t put a price on life), and the amount they should spend on the health services for others should be zero (those scabs should have made better life choices!) Good luck trying to make sense out of spending $20 to save $2000!
      • breck 6y ago
        My ROI argument is approximately that allocating $200 for health watches for everyone AND cutting $2,000 across the board everywhere else in healthcare would lead to the same health outcomes. It's a good point about how the cost of healthcare is unevenly distributed toward the end of life. I really like the newish term "Healthy Life Expectancy".