Yet Another Tricky Survey from IDC

August 28th, 2015

We don’t know the official Apple Watch sales numbers for the second quarter, but there were broad hints during the quarterly conference call with financial analysts. So we heard that Apple sold more of them than the iPhone in its first nine weeks, or the iPad in the comparable period.

But we do know that IDC doesn’t always deliver accurate or relevant numbers, and predictions for the future can be way off base. So we should have seen a huge growth in Windows Phone market share at the expense of iOS by now. But it hasn’t happened, and it appears it will never happen. Microsoft’s moves to unwind the results of the acquisition of Nokia’s handset division, and the platform’s pitiful share of the market, make that abundantly clear.

Still, IDC is taken seriously, regardless of the actual scorecard, so let’s have a look. So they did a survey of wearables, which includes far more than a smartwatch. So at the top of the is the Fitbit, with an estimated 4.4 million sales, thus capturing 24.3% of the market in the second quarter of 2015. It’s a well-established product, so when Apple achieves an estimated 3.6 million sales, ahead of many estimates, in nine weeks rather than 12, that has to count for something. That number gives Apple 19.9% of this market.

All well and good. Apple achieved a huge presence in a market in a shorter period of time. For most of that time, the product was backordered. So if the Apple Watch had a full three months on sale, and was able to meet demand, perhaps it would be number one. That appears to be the takeaway from this report.

Except for one thing: Can you really put an Apple Watch in the very same category as a dedicated activity tracker?

Yes, you wear a Fitbit, and you wear an Apple Watch, so they would superficially appear to be in the same category. But if wearing is the criterion, how about a pair of socks or a bracelet? Certainly the latter, since it goes on your wrist, right?

True, both Fitbit and Apple Watch track your physical activity, so they are therefore considered against one another by potential buyers, and that no doubt forms the basis for IDC’s conclusion. But activity tracking is just one of many features Apple Watch offers. What about comparing a personal computer to a small DVD player with a built-in display, such as the $129.99 Supersonic SC-403, which sports a 4.3-inch touchscreen? Both play media, have displays and built-in speakers. Aren’t they therefore in the same category?

Almost nobody would connect the Supersonic with a Mac or a PC, but they share a few features. Yet IDC insists on putting the Apple Watch in the wearables category with a loose definition about activity tracking.

I suppose they are, in theory, correct, and the Apple Watch is doing extremely well, in a shorter period of time, against a far cheaper product. That ought to be a good thing at a time when we are being told that the Apple Watch is an abject failure.

Now I wouldn’t presume to know if IDC’s sales figures for the Apple Watch are accurate. They do actually make sense, that this gadget has leaped to the number one spot among smartwatches. So if you compare it to a Pebble, an Android Wear smartwatch or a Samsung Galaxy Gear, Apple is doing incredibly well. This is particularly true when pitted against the Pebble,which sold a fraction of estimated Apple Watch sales over a period of a couple of years.

The prospects for the Apple Watch appear compelling for the fall. Best Buy is pleased enough with sales in 100 stores to want to expand it to the entire chain. With easy availability and the arrival of WatchOS 2 this fall, sales may very well soar. I’ll grant Apple that, although I’ve yet to see the use case that would convince me to abandon my $12.88 Walmart stainless steel calendar watch and replace it with a product that starts at $349. It has nothing to do with my store of ready cash, or credit card limit. I’m still not at all certain I need one.

In any case, the latest news about the sales results for the Apple Watch are extremely encouraging. That’s undeniable, and since IDC has tended to undercount estimated sales of Macs, I will take those numbers as conservative. It is very possible the actual figures are higher, but since Apple isn’t telling us, aside from presenting general statements about being happy with initial sales, it may be that the truth won’t be known ever, unless Apple changes its tune.

To be sure, putting Apple Watch in an overall wearable category is little different than putting the iPad in a tablet category that includes $50 pieces of junk from discount superstores. They are superficially similar products, and may share functions. But they do not realistically reflect the iPad’s actual reach or true market potential. Perhaps the same can be said of the Fitbit and the Apple Watch.

Alas, you won’t be reading about these terms and conditions in very many places. That will not change.

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3 Responses to “Yet Another Tricky Survey from IDC”

  1. Constable Odo says:

    The Fitbit with 4.4 million unit sales was considered a success. AppleWatch with 3.6 million unit sales was considered a flop. There must be a certain number that needs to be achieved that separates successes from failures and it seems as though Apple always comes up just short. I think everyone automatically labeled AppleWatch a failure even without knowing AppleWatch sales numbers. Everyone knew that Apple certainly wasn’t able to sell 30 million units and that was enough reason to call AppleWatch a failure. It’s funny how someone, anyone can put an arbitrary number out there for an Apple product and that becomes the number Apple has to sell or they’ve produced that failed to live up to expectations. As far as I know, Tim Cook never gave a set sales number that was their target. Maybe they had a number internally or maybe they figured it would take time to make consumers interested and no immediate target was set. We’ll never know for certain.

    I personally feel it’s too short a time to tell whether consumers will take to AppleWatch. We have to at least wait for the holiday season when Apple does most of its sales. Even so, I don’t expect high sales because I don’t believe consumers, even those who use iPhones, will feel it’s a necessary device to own. Comparing AppleWatch sales numbers to Fitbit sales numbers doesn’t really prove very much. There’s a large price gap and the Fitbit Flex is nothing like an AppleWatch.

  2. DaveD says:

    I have been skipping the articles that present data from Gartner and IDC. Not only on the questionable accuracy of the data, but how the data is grouped. My conclusion is that these are numbers with an agenda. The one glaring flaw that is mentioned here and in Macalope’s piece is how wrong the numbers were for the Windows Phones from IDC. If one had money on their Windows numbers, it was kissed goodbye. The magnitude of how IDC guessed wrong were huge.

    Fool me once…

    I think Apple is doing the right thing by not showcasing Apple Watch sales. Only when it is no longer just an iPhone accessory item that we can see whether an Apple Watch has broad appeal.

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