Silicon Valley: the place where you see Google Glass on faces, mobile devices in hand tweeting about the latest digital trend and smartwatches on wrists. It’s an early adopter paradise where digital dominates, trends are set and with any luck, the hype leads to greater global adoption. There’s a lot of skepticism about the potential for the smartwatch to transcend the Silicon Valley crowd but there are also favorable signs with 46% of consumers interested in purchasing a smartwatch and other wearable computing devices such as fitness monitors. These digital technologies do more than guide our musical choices; they are devices built to direct our lives.
With major companies placing their bets now, the question becomes: What will be the bigger contributor to smartwatch success: price or perceived value?
On the side of price
In Kevin Roose’s article for New York Magazine, he tests the LG G (runs on Android Wear) and the Samsung Gear 2 and imagines a dual-audience with varying price points. The tech crowd, or “Silicon Valley code jockeys” as Roose quips, might pay $200. What is Wall-Street willing to pay? Roose speculates anywhere between $500 to $1,000 or even $2,000, particularly with a smartwatch as “luxury fashion accessory” status.
Wearable technology reinforces the need for competitive price intelligence and a focus on the value of design, luxury status, and superior function to make it out of Silicon Valley.
On the side of perceived value
Smartwatches have a laundry list of functionality that ranges from telling you the time (yes, this still makes the cut) to checking your posture, tracking steps, heart rate, temperature, and providing exact geo location. Sadly, it doesn’t actually do laundry – but smartwatches can schedule your dry cleaning pick-up.
The value of this information is twofold. For the consumer, it’s the information necessary to lead their best lives with optimal health and uber self-awareness. For enterprises, that information becomes infinitely more valuable in addressable data on consumer needs, desires, and as an indicator of what consumers value based on where they spend their time – the one true limited resource.
With major contenders breaking ground on health and fitness data trackers and 54% of consumers 18 years and older across the US, the UK, Canada, Australia, India, and South Africa interested in health monitors, it’s a matter of time before smartwatch technology disrupts the data gathering technology landscape.
The battle really is this: Can smartwatch capture the perfect blend of creating consumer value and have options in prices that range from accessible to luxury status? Will one company corner the entire market? Or, as with much of the digital technology today, is it left segmented based on price? The intersection of price with perceived value will harness consumer needs and pinpoint profitability to see the smartwatch successfully mainstream and not just an accessory for those in Silicon Valley.