What it is: The Apple Watch is a wearable computer that threatens several industries simultaneously.
The quickest way to failure is to assume the future will be nothing more than an extension of the past. In the old days when change occurred slowly, that strategy may have appeared to work, but in today’s world where knowledge doubles every few years, thinking the future will be just like the past is a strategy doomed to complete and utter failure.
In the old days, people used to have a personal digital assistant (PDA), digital music player, mobile phone, and laptop computer. Then Apple introduced the iPhone that basically replaced all of those multiple items with a single item. The PDA market pioneered by Palm Computing dried up almost instantly. The digital music player led by the iPod also faded rapidly. The mobile phone leaders, Nokia and Blackberry, assumed their lead would last forever. Even laptop computer manufacturers assumed people would always need PCs, right up until the time they didn’t any more.
The iPhone wiped out several markets at once by combining their features into a single device. Most companies would have protected the iPod and saw steadily declining sales as a result. Kodak tried to protect its film business for years, despite the inevitability of digital photography being easier, more convenient, and eventually better than film. Kodak’s strategy was like trying to stop an ocean wave by standing on the beach. Nice try, but impossible. Why Kodak thought they could do the impossible is a mystery, but many people believe they too can also do the impossible by simply not changing and assuming their past leadership will never be challenged ever again.
With the introduction of the Apple Watch, new markets are starting to fall. Already Swiss watch manufacturers are reporting declining sales, especially in the luxury Asian market. Most likely people didn’t suddenly realize that they didn’t need an expensive watch any more. Instead, they decided if they were going to buy a watch, they might as well get a smart watch like the Apple Watch.
Beyond watch manufacturers, dedicated fitness bands are going to struggle. People may still want them, but their market will never grow again as more customers simply get a smart watch instead. Count the fitness band manufacturers in the same doomed, sinking boat as the Swiss watch manufacturers.
In the past, dedicated health monitors were expensive and cumbersome. Now with a wearable computer like the Apple Watch, companies making dedicated health monitors are going to see declining sales as well. The Apple Watch is hurting three industries at once:
- The watch industry
- The fitness band industry
- The health sensor industry
If you work in these industries, now is the time to get out. Just ask Nokia and Blackberry employees how well their future fared under the new market dominated by the iPhone.
The simplest strategy is to always assume your current industry will disappear overnight because chances are good that it will. By assuming this unpleasant fact, you can always take steps to insure your own survival in the future. Unlike factory workers who lose their jobs when factories move overseas and have nothing else to do but accept harder work for less pay, you want to keep rebuilding yourself. If you prepare for the future, you’ll have a better chance of surviving it. If you fail to plan for the future, your chances of surviving will be close to nothing, yet that’s the common strategy too many people choose simply because they refuse to look at the possibility that their current industry will disappear overnight.
Don’t be afraid to face the worse case scenario. Be more afraid of not being prepared if it does happen.