There’s an easy way to let Apple steal an entire industry from you. Fool yourself into complacency. Here’s how it happened to the Swiss watch industry.
Apple is a company that relentlessly moves forward in technology. This greatly annoys a few customers, but it has to be. Apple also pays considerable attention to the interets of its customers, especially the youth that emerge into its ecosystem. Doing this, Apple is well prepared to cash in on hot technical and social trends.
A case in point is the Apple Watch. Recently, our Charlotte Henry pointed to some interesting news. “Apple Watch Now Outsells All Swiss Watch Brands Combined.”
She quoted Steven Waltzer, Senior Analyst at Strategy Analytics
Traditional Swiss watch makers, like Swatch and Tissot, are losing the smartwatch wars. Apple Watch is delivering a better product through deeper retail channels and appealing to younger consumers who increasingly want digital wristwear.
Most any company can track trends amongst its customers and react. But the Swiss have been slow to do so. Why?
A compelling answer comes from a brilliant analysis by Enrique Dans at Forbes.
“How Apple Killed The Swiss Watch Industry.” In one succinct paragraph, author Dans crystalizes the deeper reason the Swiss fell behind.
In 2015, the year the Apple Watch was launched, LVMH watch division president and Tag Heuer CEO Jean-Claude Biver said the Swiss industry was not afraid of Apple’s new product, because it could not be repaired in a thousand years or eighty years, nor inherited by children, nor would it ever become a status symbol. As is always the case when disruption occurs in an industry, traditional competitors are not able to see the threat, and continue to try to analyze it according to the variables that were important yesterday.
That, in turn, reminded me of a famous quote by physicist Dr. Richard Feynman, who once spoke to a crucial principle of science.
The first principle is that you must not fool yourself — and you are the easiest person to fool.
It’s the Data
Author Dans goes on to punctuate the most compelling thing about the Apple Watch, something to which I can personally attest.
As soon as you start using the Apple Watch, you realize one thing is clear: the rest of your watch collection will live on in a drawer from now on. And every time you’re tempted to take them out and use them instead of the Apple device, you spend the whole day looking at your wrist for information that isn’t there. [Emphasis mine.}
Perceiving the Threat
The inability to visualize the threat is one of the basic reasons companies fail in their competition with Apple. This happend to the Microsoft Windows team that was caught of guard by the iPad in 2010. Former Windows chief Steven Sinofsky explains: “The 10th Anniversary of the iPad: A Perspective from the Windows Team.”
There are few signs that Apple’s competitors are getting any smarter about how to compete with Apple in consumer electronics. Doing that requires study, vision, attention to trends, and the willing expenditure of resources and people to push the limits of modern technology. Even when temporarily flush with cash, many CEOs won’t do that. They fail to perceive the threats and, by virtue of the freedom afforded by their power, fool themelves into self-satisfaction.
Steven Waltzer concluded:
The window for Swiss watch brands to make an impact in smartwatches is closing. Time may be running out for Swatch, Tissot, TAG Heuer, and others.
Time will now tell.