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Early Adopters & Apple Watch

How does adoption of behaviours propagate among social networks? Let’s take, for example Apple’s wearable technology, the Apple Watch. First appearing on the tech scene mid-year 2015, murmurs were to be heard of how likely the watch would catch on with the mass populace. Surprisingly, evidence has shown that people are generally quite satisfied with this first iteration of the Apple Watch, although this opinion seems to come from those less involved in technology. In class, we’ve talked about network effects, and we can see that early adopters include both individuals highly invested in the Apple economy, as well as technology buffs and other individuals. After these initial adopters, the product spreads through their friend groups and relations, whether by online reviews or by word of mouth, and eventually to the rest of the population.

However, like many Apple products, there is a barrier to entry in the form of price. In one source (listed second below), Apple prices have historically been cut with successive iterations of a device. Similar to what we’ve talked about in class and in the homework, lowering the upfront price a consumer would pay also moves the tipping/critical point leftwards on our adoption curve. At the same time, the equilibrium point would shift right. Therefore, we could predict that with a lower cost to procure an Apple watch later on in its version cycle, more people would be willing to purchase. This influx of customers would later on offset profits lost at the initial selling price.


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