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Is Cupertino milking a cash cow with Apple Watch bands?

Is Cupertino milking a cash cow with Apple Watch bands?

That iThingy You're Wearing
June 18, 2015

Did you pick up an extra band to go along with your Apple Watch? If you did, you might be interested to know just how much those bands cost for Apple to make. One technology firm, IHS, has found that Apple is making huge markups on these bands, according to a recent report from Reuters. A study by research firm Slice Intelligence suggests that around 17 percent of Apple Watch shoppers have purchased more than one band to go along with their smartwatch.

According to IHS, the $49 entry-level sports band only costs around $2.05 to manufacture, at least for the 38mm band. Granted, these estimates don’t include expenses like research and development, tooling costs, packaging, or shipping, so they might not reflect the full cost to get that band from its raw components onto your wrists. Even so, the markup is a pretty hefty sum of money.

Let’s ignore the question of, “Is it fair?” for just a moment. Life isn’t fair, so we can’t truly expect Apple to play by any such rules. Is it right, though, to impose such a markup on the price of bands for the Apple Watch? I did a little bit of research into how much watch bands actually cost, and I was pretty surprised at what I found. The last time I bought a watch band was 10 years ago, and I might have paid $10 to replace the strap on my Timex Ironman.

What I’ve found, though, is that fancy watch bands cost money. A black rubber watch band for the Rolex Submariner, Explorer, Gmt, Sea-dweller, and Yacht-master watches costs $195 on Amazon. At the other end of the spectrum, a green rubberized sportsband from Suunto runs $36.35. Sure, there are options for less money, but the quality is bound to be subpar.

Apple not only has to recoup the costs of the materials, shipping, handling, and packaging, but they’ve also got salaries to pay and shareholders to keep happy. The price of the Apple Watch band, while clearly marked up dramatically, is not really out of line with what the industry is doing on average. Yes, you’ll find cheaper bands for your Apple Watch, but you’ll also find much more expensive ones, I’m sure. When the Apple Watch band market of third-party options really takes off, I predict that price points will be as wildly varied as the ones I found looking for bands on Amazon. One thing you can be sure of, though, is that bands crafted to the quality Apple demands and usually provides will come at a premium, not a discount.

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