There’s no debate about which version of the Apple Watch is the sales champion. For 2020 that would have been the aluminum Series 5. Starting at $399, the aluminum Series 5 is a much easier purchase decision for many versus the stainless steel Series 5 which started at $699. But the more interesting question to me is, which watch comes in 2nd place? Prior to Apple announcing the new lineup of the Series 6 and SE, I suspected that the Series 3 was the next highest selling model. After the announcement, I’m certain of it.
When I was working for the Herman Miller office furniture company, our best selling and highest margin product line was one that we had introduced 20 years prior. Herman Miller had newer more expensive product lines with superior features but they didn’t top the sales charts. Did our sales champ have integrated cable management? No. Did it have powered receptacles for desk accessories? No. Was it low cost and did it get the basic job done? Yes. Due to the strong sales of this aging product line, we never killed it. And since the manufacturing lines were fully depreciated, it was highly profitable.
Tech writers often have it backwards on how companies make product line decisions. These decisions aren’t so much made in corporate conference rooms as they are out in the field. If a product is selling robustly, there is enormous pressure from within the corporate sales and marketing group to keep an old product line alive. They are the voice of the customer within an organization, and they will milk that fact for all it’s worth. I’ve seen it from within at Herman Miller and other Fortune 500 level companies.
The question of whether the Series 3 outsold the stainless steel Series 5 is one that I noodled off and on this year. Due to the tremendous gravitational effect that low price can exert on customer decisions, I guessed that the Series 3 was outselling the stainless steel Series 5. But when Apple unveiled both a lower cost SE model AND kept the Series 3 in the line up, I knew it had to be true.
From a detached logical perspective, you’d think that the lower cost SE was primed to take over the value spot. Oddly, Apple didn’t do that. Why? Sales of the Series 3 must have been very strong. If the Series 3 was the second best selling line of watches year to date in 2020, that would’ve made it nearly impossible for them to kill it. There would’ve been an insurrection from the sales and marketing groups if they tried. And if the Series 3 is making a nice tidy gross margin percentage, the financial analysts may have joined them.
Plus, these Series 3 owners are almost certain to upgrade to newer more powerful watches in the near future. More upside for Apple. Series 6 and SE purchasers may not upgrade for 3 or more years in the future.
There’s only one group who is negatively affected the decision to keep the Series 3 alive. And it’s the usual suspects, the developers. Apple’s group of iOS developers keep their consumer hostile streak alive by attacking yet another decision by Apple which is good for the average consumer. If iOS developers had their way they would pay zilch to support the iOS AppStore, everyone would sign up for monthly subscriptions, and everyone would pay big money to upgrade to the latest Apple devices.
The Series 3 is still a great watch that is very useful. Any concern about performance is overblown because the S3 processor is still very capable. I kept my old Series 3 Apple Watch around and sometimes use it when I want a different look. It’s not that much slower than the new watches. And it has a battery that is almost 20% larger than the Series 4 or 5. If you just want a watch that lets you see your messages without having to pull your iPhone out of your pocket, then this a good option.
By writing that I think that the Series 3 outsold the stainless steel Series 5 in no way am I insinuating that it’s a better watch. The Series 5 or 6 bring a lot to the table that the Series 3 doesn’t have like the new watch faces and always-on display. I’m simply recognizing the economic reality of price elasticity and trying to explain why the Series 3 is still around. In short, because the market demanded it.
Tech writers often have it backwards on how companies make product line decisions. These decisions aren’t so much made in corporate conference rooms as they are out in the field. If a product is selling robustly, there is enormous pressure from within the corporate sales and marketing group to keep an old product line alive. They are the voice of the customer within an organization, and they will milk that fact for all it’s worth. I’ve seen it from within at Herman Miller and other Fortune 500 level companies.
The question of whether the Series 3 outsold the stainless steel Series 5 is one that I noodled off and on this year. Due to the tremendous gravitational effect that low price can exert on customer decisions, I guessed that the Series 3 was outselling the stainless steel Series 5. But when Apple unveiled both a lower cost SE model AND kept the Series 3 in the line up, I knew it had to be true.
From a detached logical perspective, you’d think that the lower cost SE was primed to take over the value spot. Oddly, Apple didn’t do that. Why? Sales of the Series 3 must have been very strong. If the Series 3 was the second best selling line of watches year to date in 2020, that would’ve made it nearly impossible for them to kill it. There would’ve been an insurrection from the sales and marketing groups if they tried. And if the Series 3 is making a nice tidy gross margin percentage, the financial analysts may have joined them.
Plus, these Series 3 owners are almost certain to upgrade to newer more powerful watches in the near future. More upside for Apple. Series 6 and SE purchasers may not upgrade for 3 or more years in the future.
There’s only one group who is negatively affected the decision to keep the Series 3 alive. And it’s the usual suspects, the developers. Apple’s group of iOS developers keep their consumer hostile streak alive by attacking yet another decision by Apple which is good for the average consumer. If iOS developers had their way they would pay zilch to support the iOS AppStore, everyone would sign up for monthly subscriptions, and everyone would pay big money to upgrade to the latest Apple devices.
The Series 3 is still a great watch that is very useful. Any concern about performance is overblown because the S3 processor is still very capable. I kept my old Series 3 Apple Watch around and sometimes use it when I want a different look. It’s not that much slower than the new watches. And it has a battery that is almost 20% larger than the Series 4 or 5. If you just want a watch that lets you see your messages without having to pull your iPhone out of your pocket, then this a good option.
By writing that I think that the Series 3 outsold the stainless steel Series 5 in no way am I insinuating that it’s a better watch. The Series 5 or 6 bring a lot to the table that the Series 3 doesn’t have like the new watch faces and always-on display. I’m simply recognizing the economic reality of price elasticity and trying to explain why the Series 3 is still around. In short, because the market demanded it.
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