Apple Inc. (NASDAQ:AAPL) is making strategic moves that will get the Apple Watch out to more buyers, increase the interest of consumers, and lead to an increase in sales. WSJ reports that Apple has struck a deal with Best Buy to have the Apple Watch in its stores and on its website starting from August 7.
Best Buy will now be the first mass-market retailer aside from Apple to carry the Apple Watch. It was reported that the Apple Watch would be available in 100 Best Buy Stores and its website by August 7. The sale will kick off in additional 200 Best buy stores in time for the holidays.
The Bullish Case for Selling Watch on Best Buy
Bullish investors will consider Apple’s move to have Best Buy carry the Apple Watch as a strategic move that will get the Apple Watch out into more hands. The Apple Watch has not been widely available due to problems with the production line and the high demand that delayed its launch until the middle of June. Now, selling the watch in about 300 Best Buy Stores, on Best Buy’s website, in some 350 Apple Stores, on Apple’s website shows that the production problems have been solved.
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The Bearish Case for Selling Watch on Best
Apple bears will surely not be impressed by Apple’s decision to sell its Watch in Best Buy stores. For one, the hype about how the Apple Watch will be sold didn’t make it look as if it would be sold by mass-market retailers. Apple initially started selling the Watch through a pre-order system on its website, and you can’t just walk into an Apple Store to pick one. Buyers had to order online then go for an in-store pick up.
Now, that the Watch is available in Best Buy, it suggests that rumors about dismal sales of the Watch are true and that Apple wants to get as many Watches as it can get out of its shelves as soon as possible.
Analysts are divided about how well the Apple Watch has fared since its launch and Apple has been tight-lipped about the actual sales figures.
For instance, Andy Hargreaves, a Pacific Crest analyst has opined that the demand for Apple Watch has been lower than expected. , Andy lowered F2015 estimate to 10.5M from 11M. Noting that “soft follow-on demand” will result in sales lower than the Pacific Crest’s previous estimate for F2016, Andy lowered the Apple Watch estimate from 24m to 21m.
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In contrast, analysts at Strategy Analytics estimate that Apple has sold 4 million units of Apple Watch and Analysts at Canalys places the figure at 4.2M units.
In the final analysis, it doesn’t matter whether Apple’s decision to sell the Watch in Best Buy stores is strategic or desperate. What matters is that Apple is putting its product out there and sales are sure to increase in the next couple of months.