Retail reaction has been “excellent” to Movado’s debut of its first Android Wear smartwatch, CEO Efraim Grinberg said on a Thursday earnings call. Movado previewed the smartwatch, called Movado Connect, at the Baselworld 2017 show in Switzerland in March and plans to introduce it in Q3 (see 1703080045). Overall, the wearables category “is not really material to us” in terms of revenue contributions, though it will have “some effect” negatively on Movado’s gross margins because the margins there “are not as attractive” as they are in “traditional” watches, said Grinberg. Movado shares fell nearly 6 percent midday Friday before recovering to finish the day 3.4 percent lower at $21.40 after the company missed its revenue and earnings targets for Q1 ended April 30.
Fossil, set to blitz the fashion watch market with 300 smartwatch models across 14 brands this year (see 1703240043), will back the effort with an advertising campaign called “Fossil Firsts,” said the company in a Monday announcement. The campaign features actress Yara Shahidi and singer Austin Mahone representing “first Fossil” wearers and actress Kristen Bell and musician Leslie Odom Jr., as established Fossil customers, said the company. The campaign will run through the end of the year, Fossil said.
Casio began shipping the Pro Trek smartwatch ($500) Friday powered by Android Wear 2.0. Features include GPS, color map display and offline map usage functionality, water resistance down to 50 meters and rugged build, a company announcement said. A location memory app reads the user’s current location, which can be called up by a side button on the watch, and users can add notes to map locations to mark memorable spots, it said.
Verizon is counting down the days -- 24 on Monday -- until its Wear24 smartwatch hits stores. The Android-based phone is always connected to a user’s smartphone, letting it operate on its own to make calls, send texts, stream music, receive notifications and interact with Google Assistant, said Verizon in an announcement. Google Play apps download directly to the smartwatch, and interchangeable watch faces can change according to location, it said. Verizon didn't respond to a question about the wireless charging technology used in the watch, which comes in black, rose gold or steel finishes. The Verizon exclusive will be available May 11 for $349 or for $299 with two-year activation, and Verizon users can add the watch to an existing plan for $5 per month plus taxes and fees, it said.
In a follow-up to its 300 Baselworld jewelry show watch introductions Thursday, Fossil Group Senior Director Kyle Beste emailed us that the company is eyeing three opportunities in the connected watch space: activity trackers, touch-screen smartwatches and hybrid smartwatches “that look like a regular watch but act like a smartwatch.” New for 2017 are an improved user interface, AMOLED screens, more frequent dial updates and third-party apps made possible by Android Wear 2.0, Beste said. Hybrid designs allow discreet notifications of texts, emails and phone calls through haptic feedback and hand movement on the dials, said Beste. The watches automatically set the time zone and have link technology to allow users to control music, take a selfie and ring a phone, he said. Activity trackers, hybrid smartwatches and touch-screen smartwatches address the various needs and personal styles of connected consumers represented by each brand, and Fossil’s technology platform is “reinvigorating” each category by improving design and functionality, he said. Despite the common platform, brand teams operate “completely independently, with designers dedicated to individual brands,” Beste said. Each of the 300 watch models for 2017 introduced across the company’s 14 brands was an individual project with each licensor and “uniquely developed to be in line with the brand's DNA and target consumer,” he said. On Fossil Group’s road map for connectivity within its overall portfolio, Beste said, “We sell 30 million watches a year and we see more of a convergence of our analog and connected products than a shift from one to the other.” He wouldn’t specify a time frame for a complete transition from analog to connected, but said, “We do envision a day when every watch we make will have some type of connectivity in it.”
Though Movado is playing increasingly in the smartwatch space, “we’re still big believers that there are many opportunities with conventional watches that are differentiated by great brands and innovative design,” said CEO Efraim Grinberg Monday on an earnings call. “There has already been a saturation, slowdown and commoditization of the fitness band category, and some of the major players are downtrending,” said Grinberg, in an obvious reference to Fitbit, which recently blamed early adopter saturation for its significant sales shortfall in 2016's holiday quarter (see 1702230039). In the smartwatch space, “there is a continued opportunity as technology improves and consumers are able to get the creative designs they desire to deliver the functionality that they are looking for,” he said. Movado is “confident with our strategic approach” to the “emerging” smartwatch business, said President Ricardo Quintero. “Early results confirm that this category is relevant, but technology has not caught pace with what consumers are looking for,” said Quintero. “Apple has played a disruptive role in the fashion watch category.” With Movado's recent introduction of Movado Connect, among the first smartwatch lines to support Google’s newly redesigned Android Wear 2.0 platform (see 1703080045), “we will begin to enter the fully connected smartwatch space,” Quintero said.
Movado, whose market differentiator in the smartwatch category has been to offer “beautiful wristwatches that are watches first” (see 1511240041), will collaborate with Google for the first time on a smartwatch “collection” to be unveiled at this month’s Baselworld 2017 show in Switzerland, Movado said in a Wednesday announcement. Called Movado Connect, the new smartwatch line is among the first to support Google’s newly redesigned Android Wear 2.0 platform, Movado said. Five men's styles with a starting price of $495 will be available in the fall in the U.S., the Caribbean, Canada and the U.K., it said. Baselworld 2017, the global trade show for the watch and jewelry industry, opens March 23 for an eight-day run.
Eleven percent of consumers in U.S. broadband homes own a smartwatch, up from 6 percent at the beginning of 2015, Parks Associates reported Wednesday. Fifty-eight percent use their smartwatch for fitness tracking, said Parks, and 57 percent use it to receive notifications such as texts and Facebook updates. Nine percent of smartwatch owners use their device for smart home control, it said.
Pebble devices “will continue to work as normal,” but warranty support is no longer available, said founder Eric Migicovsky in a blog post Wednesday after the announcement that Fitbit acquired assets of the smartwatch platform company Tuesday. “No immediate changes to the Pebble user experience will happen at this time,” said Migicovsky, who said Pebble functionality or service quality “may be reduced in the future.” Migicovsky steered customers looking for product assistance to website support and the Pebble forum. Pebble is “no longer able to operate as an independent entity,” said Migicovsky. Fitbit bought assets including “key personnel” and intellectual property about software and firmware development, it announced, but Pebble’s hardware products weren’t part of the transaction. The assets give Fitbit “deep industry expertise in platform development” that complements Fitbit’s health and fitness features and will enable faster delivery of new products, features and functionality, said the wearables maker. It also will accelerate development of customized solutions and third-party applications for Fitbit Group Health customers, it said. Android accounts for nearly 90 percent of smartphone operating system market share globally, and acquiring Pebble’s “open, agnostic” OS allows Fitbit to compete with cross-platform devices, it said. Terms weren’t disclosed, but analysts pegged the value of the assets at $34 million-$40 million. A Fitbit spokeswoman emailed us that the acquisition "is not material to Fitbit’s financials," so terms won't be disclosed
This holiday selling season marks Movado’s debut of the first smartwatches under its various licensed brands, such as Coach, Hugo Boss and Juicy Couture (see 1608250020), and “we’re pleased with the early reads,” CEO Efraim Grinberg said on a Tuesday earnings call. But President Ricardo Quintero chimed in later to say the company doesn’t see the smartwatch category “becoming a significant portion of our business, given the limitations in the functionalities and physical dimensions of current technology.” Movado will “continue to engage” in the smartwatch category “as the technology evolves and the opportunities arise,” Quintero said. Grinberg denied in Q&A that Quintero’s disclaimer reflects any cooling in Movado’s enthusiasm to pursue the smartwatch business. “We’ve always taken a kind of patient approach to the wearable technology space and smartwatch space,” Grinberg said. “We’re really proud of the hybrids that we’ve introduced in our fashion brands and the one that we’ll introduce in Movado this year, and we’re continuing to explore other opportunities in that segment as well. But we also see a really continued large market for conventional watches, as long as you drive them with innovation, image and design.”