Hot off the announcement that Apple (AAPL) is hosting an event on March 9th (rumored to detail the availability and pricing for the Apple Watch), it is time to check in on how we see this emerging category.

Recent mall checks have revealed that branded smart watches are already in stores, but most retailers lack the technical sales support and merchandising needed to sell through to customers. This is compounded by where and how to merchandise wearable devices in general: as accessories, watches or as electronics. This is where Apple retail, where highly trained sales teams and vertical integration provide a seamless experience, has a distinct advantage over mass and specialty retailers.  Moreover, Apple retail is being revamped under the watchful eye of Angela Ahrendts for the Apple Watch launch. As a comparison, checks at Best Buy have shown visual displays but little sales support for existing models with the exception of Samsung’s branded areas, where customers appear to be glazing over.

What we’re expecting in the category is the emergence of a good-better-best pricing strategy, mimicking the positioning of Apple’s own Sport, Watch and Watch Edition tiering—prices of which start at $349 and are rumored to explode for the limited, top-of-line versions priced between $2,500 to over $10,000. We’re looking at an introduction of designer and technology-branded, less-enabled smart watches priced from below $100 to $400  with the sweet spot below $200, catering mostly to Android and value consumers (Apple Watch requires an iPhone 5 or newer). This will define the entry price point, leaving Apple holding the better-best categories for the foreseeable future.

The bigger question remains if the Apple Watch will be the brand’s first real foray into luxury products competing directly with established heritage brands. By the 12-page ad insert in U.S. Vogue (plus a 2-page editorial spread in French Vogue) representing a whole new marketing strategy for the product, it sure looks that way. We’ll set our alarms for March and check in again.

The information contained within this post is the opinion of Mary Epner Retail Analysis and does not provide any advice regarding the purchase, sale or any other transaction in any security. For our complete terms, please click here

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