Retailers are ready for shoppers armed with Apple Watches.
This story first appeared in the April 24, 2015 issue of WWD. Subscribe Today.
The first wave of consumers — the millions who made the preorder window — will start receiving their watches today. Everyone else will have to wait until June, when the smartwatch begins shipping in earnest and hits Apple stores.
Merchants have been quick to develop apps for the watch, with Target, QVC, Etsy, Kohl’s, eBay and Asos all jumping in.
The benefits could be huge if the smartwatch becomes a steady shopping companion.
Analysts estimate that Apple could sell about 20 million Apple Watches this year. Prices start at $349 for sport models with aluminum casing and fluoroelastomer bands to $10,000 for 18-karat yellow or rose gold casings with leather bands and corresponding gold buckles and clasps.
While the experience is largely an extension of the smartwatch’s companion iPhone app (the majority of sales will still take place on the phone), the Apple Watch is the latest tool for merchants wanting to become omnichannel retailers.
Kohl’s, for instance, has been developing its smartphone experience and driven more than 5.5 million downloads for its app since October, with many people using its proprietary mobile wallet feature that is home to its Yes2You Rewards and Kohl’s Cash programs.
The retailer wants to keep that momentum going with the Apple Watch.
Ratnakar Lavu, Kohl’s executive vice president of digital technology, said there were great opportunities to use the Apple Watch to reach customers while they’re in one of the retailer’s 1,164 doors.
“All the loyalty rewards and Kohl’s Cash that are part of your mobile wallet can be easily shown on the watch, and they don’t need to pick up the phone to see the wallet,” Lavu said.
He added that in the future, they would like the app to include notifications, so that a consumer who enters one of the company’s stores would get a message notifying them how much Kohl’s Cash they have in their account.
Pure-plays are also looking to take advantage of the watch.
“Our mantra is to deliver the Asos experience at the swipe of your thumb,” Nick Beighton, Asos chief operating officer, told WWD Thursday. “This is not me telling you that keyboards are dead. What this is saying is that customers are increasingly showing that they want access to our experience in a device agnostic way, increasingly through a smartphone.”
But this will soon evolve to the swipe of an Apple Watch, with what Beighton described as a series of push notifications that are calls to action, but carry less friction than the smartphone experience. For instance, if a user liked a dress in the app and saved the item for later, she will get a notification on her watch if it’s low in stock so that she can add it to her bag and head to her computer or phone to buy it before it sells out.
Currently, 51 percent of the U.K.-based site’s global traffic comes from mobile. (Mobile accounts for 60 percent of all traffic in the U.K. and 80 percent of traffic in China, through Tmall.com.)
According to Ben Bajarin, an analyst at Creative Strategies, one of the most attractive elements of the watch for developers is that it offers the value of the digital world in a hands-free environment. He explained that if someone is walking through a store, it’s not likely that they’re staring at their phone the entire time — and the Apple Watch facilitates a digital experience without having to actively use one’s phone.
He cited Target’s Apple Watch app, which lets consumers build a list and once in store, the app guides them exactly to where each item is located. This already exists on the retailer’s iPhone app, but on the watch, although the tool is the same, it has a different use case.
“Certainly you can get all of this on your phone, but the point is that you aren’t staring at your phone 24/7,” Bajarin said. “The Target app is interesting because it has the deals and gives you coupons you have on your list and navigates you there if you’re pushing a cart or carrying a bag.”
Thus far, it appears one of the most useful tools on the watch is its nearly seamless Apple Pay integration. With two taps on the side of the watch, payment information is ready to be processed at terminals that accept Apple Pay. The tech giant said that as of last month more than 2,500 bank credit unions are on board to bring Apple Pay to millions, with the service available in 700,000 locations, from Whole Foods to Sephora.
Experts predict that the feature could eventually have a significant impact on the mobile payment space. While the entire process for Uber, for example, occurs within the confines of the watch, the retail world is focused on using the gadget to help facilitate purchases in-store or on an iPhone.
Etsy, which is gearing up for its initial public offering, already sees more than half of visits to Etsy.com coming from mobile devices. As of the end of the last year, the marketplace’s smartphone app had been downloaded 21.8 million times. The brand’s Apple Watch experience will give shoppers personalized recommendations and shipping notifications and let them interact with sellers.
“We’re still unsure if users will actually purchase using the watch or it’s just a tool to use alongside and make the purchase on iPhone,” said Arpan Podduturi, Etsy group product manager of mobile.
QVC is also primed for heavy Apple Watch usage, according to Alex Miller, the company’s senior vice president of digital commerce.
With an iPhone and iPad app that has seen nearly 3 million downloads, Miller said introduction of the Apple Watch will help QVC leverage “check-in type content.”
“The usage pattern is different,” Miller said of QVC’s highly engaged consumer. “There is much more usage throughout the day. Our brand is uniquely positioned to encourage checking in — we’re introducing new content all day, every day. It’s the most visible on live TV, and it encourages this check-in behavior.
He said the best customers check in multiple times per day. They want to access core items like Today’s Special Value and QVC’s best find of the day in a snackable way so they can order as efficiently and quickly as possible.
Miller said a mobile-first approach has been the digital strategy for several years — and that the move to the wrist is a natural extension of the shopper’s need to visit QVC over the course of the day. He cited an easy handoff to the iPhone app if the consumer wishes to engage further.
He acknowledged that a challenge for retailers will be in developing an experience that works on such a small screen. But once they do, he predicted that future watch experiences won’t be tethered to an iPhone app. For the time being, users can start their journey on the Apple Watch, but are ultimately directed back to their iPhones to complete the transaction.
“The fact that they have to do a handoff on to a phone isn’t ideal,” Miller admitted, although he remained optimistic about how QVC’s Apple Watch app could enhance the mobile and overall shopping experience.