🍏 How Apple built a 10-year lead in wearables


June 3, 2021

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Theater chain AMC saw shares nearly double on Wednesday (and the stock is now up 25x in 2021). In an absurd stat: 500m+ AMC shares exchanged hands yesterday. That’s more trading volume than Tesla, Apple, Amazon, Facebook, and Microsoft combined.

The big idea
Apple watch

Apple’s AssistiveTouch in action (Source: Apple / YouTube)

How Apple built a 10-year lead in wearables technology

Apple’s latest reveal looks like it belongs in a sci-fi movie.

Called AssistiveTouch, the technology allows users to control their Apple Watch without having to touch the screen. Instead, you can pinch and clench your hand or roll your wrist to do black magic activate apps.

Tech analyst Neil Cybart says Apple’s latest innovations give it a 10-year lead on the competition.

In 2021, Apple is on pace…

… to sell 100m+ wearables units. Including the Watch, AirPods, and select Beats headphones, Cybart estimates that Apple’s wearables division will do $30B in 2021 revenue.

“That would rank Apple wearables on a combined basis just shy of a Fortune 100 company,” he writes.

How did Apple build such a strong wearables business?

Cybart cites 5 reasons:

  • Early to the game: One of Apple’s guiding principles is to make technology more personal, and it started investing in wearables in the early 2010s, including its own silicon chips.
  • Other companies bet on voice: Few Big Tech firms have Apple’s hardware expertise, so they invested big on voice (e.g., Amazon’s Echo) as the new computing paradigm. It looks like the wrong bet.
  • Design expertise: People have to want to wear wearables. Apple has a track record (and talent) for creating hardware people show off for looks as much as computing power.
  • Supply chain advantage: Wearables tech is built on top of parts made for smartphones. Apple has been able to leverage lessons and relationships from its iPhone manufacturing experience.
  • Ecosystem advantage: Apple’s entry-level AirPods and Watch are both under $200. It’s able to hit these price points because the wearables effectively share computing power with the iPhone.

At the current pace, Cybart believes Apple’s wearables division will soon hit $50B a year. With a clear lead in such a fast-growing category, Apple execs must be pinching themselves.

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Hackers built an entire streaming site advertising fake movies just to put malware on people’s computers. #privacy

Want followers fast? The Hustle’s Alex Garcia shares 9 secrets to quickly building social media and email audiences. #hustle-picks

At least 174 anonymous Facebook employees signed a letter calling for an investigation into the removal of pro-Palestinian posts. #big-tech

Virtual reality could treat people with OCD by simulating phobias and triggers in a safe environment. #emerging-tech

To curb crypto tax evasion, Biden suggests stricter regulations like cutting the 1099-K reporting threshold from $20k to $600. #fintech-cryptocurrency

Etsy picks up Depop — the UK-based app for buying and selling used clothing — for $1.6B to tap into the Gen Z market. #ecommerce-retail

The New York Times explores how Just in Time manufacturing helped lead to pandemic shortages. #ecommerce-retail

Solar power isn’t just for roofs. SolTech Energy Sweden says warehouse facades — so, the sides — are an untapped resource. #clean-energy

Lyft’s new e-bike drops in San Francisco this month with a bigger battery that’ll get you 60 miles. #clean-energy

Retail
White Claw

Hard seltzers are bigger than ever

In case you thought White Claw Summer ended in 2019, it’s only just begun.

Sales of hard seltzer shot up to $4B in 2020 compared to $500m in 2018, per The New York Times.

Big at bars and at home

Hard seltzer sales increased by 73% at bars and restaurants in 2019, according to NielsenIQ. But even as those venues closed amid the pandemic, retail sales surged in 2020.

Analysts told the NYT they predict sales will bubble up to $8B+ in the next 4 years.

Why do people love fizzy adult water so much?

  • Seltzers are seen as “healthier” because they have less sugar and fewer calories than beer, wine, and cocktails
  • You can mix them with other beverages
  • They’re generally low-ABV (5%), which reflects the changing drinking culture
  • Unlike the much-maligned Zima, hard seltzer appeals to all genders
  • They’re insanely meme-able — “ain’t no laws when you’re drinking Claws” (unfortunately, not true)

The top-reigning seltzer champs…

… are currently Mark Anthony Brands’ White Claw and Boston Beer Company’s Truly, accounting for ~70% of the market.

But new challengers are popping up everywhere:

  • Michelob Ultra launched an 80-calorie organic seltzer
  • Coca-Cola and Molson Coors Beverage teamed up to debut a hard seltzer Topo Chico
  • E&J Gallo Winery’s High Noon entered the market as the first brand to use vodka instead of malt liquor
  • Even PBR got in the game, though its “Stronger Seltzer” is 8% ABV

The worst seltzer? Probably this Four Loko that comes in at 12% ABV.

Want more insights on the hard seltzer market? Check out this 5-slide deck that Trends contributor Alex Moskov wrote in 2019.

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Clean energy
7-Eleven sign

7-Eleven is adding 500 new places to charge your car

What if you could get a Slurpee and a car charge all in one place?

7-Eleven says it will bring 500 electric vehicle (EV) charging stations to 250 US and Canadian locations by 2023, per TechCrunch. The Texas-based convenience store chain currently operates 22 stations at 14 stores in the US.

The convenience chain will own…

… and operate all of the new Direct Current Fast Charging (DCFC) stations.

It’s a good move for 7-Eleven because it has ~1800 locations — 19% of its US stores — in California, which will require all new passenger vehicles sold in the state to be zero-emission by 2035.

Other retailers are plugging into the trend:

  • Walgreens currently offers EV stations at ~400 locations throughout the US
  • IKEA now offers EV charging at all stores with parking

But we still need more!

There are 5k+ EV stations in the US, per the Department of Energy.

But, as Bill McKibben of The New Yorkers’ “The Climate Crisis” notes, some only offer slow charges. This was an issue for him when trying to drive his Kia Niro from rural Vermont to suburban Boston and back.

As an optimistic start, President Biden’s American Jobs Plan includes $15B to be invested in building 500k stations nationwide.

But is it OK to drive with a brain freeze?

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literal apple watch

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