Apple Watch ushers in new era for Apple retail

Apple CEO Tim Cook officially unveiled the Apple Watch in a special event in San Francisco. There are three models in a range of finishes and prices, the expected apps, a fitness tracker and the promise that Apple Watch will change retail in a variety of ways, in much the same way that the iPod and iPhone did before it.

The watch itself allows users to access email, make and receive calls, interact on social media sites and track physical activity. It also has an 18 hour battery life, comes in a variety of styles and is scheduled to go on sale April 24.

"Since what you wear is an expression of who you are, we've designed Apple Watch to appeal to a whole range of…preferences," said Cook.

The entry level Sport model starts at $349, steel versions range from $549 to $1049, and the limited edition watch begins at $10,000.

Cook showed an image of an in-store display for the new watch, one quite similar to how Apple has displayed most of its mobile products—secured to a table in an Apple store, but the variety of models have many wondering if a new sales environment is in the works to better sell a product that seems more suited to a jewelry store or specialty boutique setting than a technology store.

Apple Design Chief Jonathan Ive told The New Yorker earlier this year that he was tapped by the company's Senior VP of Retail, Angela Ahrendts, to redesign the store, or at least part of the store, to accommodate the luxury shopper that the watches will attract.

There is also some indication that Apple will install boutiques in high-end department stores. Nordstrom is just one such chain mentioned. Certainly former Burberry CEO Ahrendts brings experience in selling luxury goods, and in pairing that product category with cutting edge technology.

"With her background, I would expect to see a very different Apple experience from what has evolved today," said retail consultant Neil Stern, McMillanDoolittle. "While it is extraordinarily effective in selling productivity, the actual experience is fairly spartan and driven around high product demand and a terrific work force. I would expect that it would be moving more experientially and omnichannel focused (as Burberry has...)."

"The Apple Watch clearly moves more into the luxury realm and becomes less of a technology play," said Stern. "In the very near future, we could start to see in-store boutiques that create the right kind of experience to sell a high-end watch."

In fact, it could simply be that Apple stores are ready for a remodel in general, exclusive of Watch.

"They do need a refresh," said Stern. "Besides some beautiful architectural projects and efficiency-driven efforts, like the removal of cash wraps, little has been done to impact the inside of the stores. [It's] definitely time."

Apple Pay and Passbook integration into the device will also help push mobile payments forward, although at these prices—the watch starts at $349—the Apple Watch will ramp up the adoption curve slowly rather than adding tens of millions of new users with a bang. All of which could be a good thing, as stores become more accustomed to accepting new, alternative forms of payments.

Of particular interest to retailers should be Apple's stance on privacy and its promise that retailers will not have access to wearer's data. Already this component of Apple Pay is forcing retailers to rethink how they gather data and prompting third parties to explore new ways to collect information.

What is less clear are the implications of Watch for retailers and brands in terms of marketing: pushing or integrating messages into the device. As vibrant a platform as the smartphone is, retailers have really only just begun to explore the medium. Beacons, watermarking and geo-fencing on smartphones are barely out of infancy, and now there is this new wearable.

The smart watch era has only just begun.

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