Eat your heart out, Apple.
Best Buy Co. confirmed Wednesday that it will exclusively sell the first “smart watch” for a mass market, besting Apple in the race to expand mobile computing beyond smartphones and tablets.
The smart watch alerts users to e-mails, text messages and phone calls via Bluetooth connections to devices running on Google’s Android and Apple’s iOS operating systems. Consumers also can remotely control their music from services like iTunes and Spotify.
“We’re really excited … when we can provide an exclusive product to our customers,” said Best Buy spokeswoman Carly Morris.
The watch, which costs $149.99, will hit Best Buy stores Sunday and already is available at bestbuy.com.
Though the watch isn’t expected to generate huge sales, exclusively selling the first device for the nascent “wearable technology” market will boost Best Buy’s technology credentials, said Stephen Baker, an analyst with NPD Group.
“Best Buy wants to be perceived as the leader in technology,” Baker said. “But to be that, they need to get the newest thing first.”
The electronics industry is looking for ways to expand beyond smartphones, and excitement has been building over the possibilities of wearable technology — mobile computing and communication devices that can be worn, not just held. Apple has been developing some sort of smart watch, but several reports suggest the company won’t launch the product until later this year or the first half of 2014. Google also is reportedly working on a smart watch and has been testing versions of its “smart glasses.”
Adding to Best Buy’s coup is the story behind Pebble Technology, which developed the watch. Best Buy executives met with Pebble after the California start-up company completed a campaign to raise money on Kickstarter, the crowdsourcing site. Crowdsourcing is a relatively new fundraising technique that allows people and organizations with limited means to quickly raise money from people via the Internet.
Pebble’s effort ultimately generated $10.2 million from 68,000 backers, one of the most successful crowdsourcing campaigns, the company said.
For Best Buy to partner with a cutting-edge, grass-roots story like Pebble “puts Best Buy at the right place in what the industry and customers think about them,” Baker said.
Best Buy has long courted Silicon Valley and its legions of venture capitalists and technology start-ups. The retailer has sponsored events like Tech Crunch’s annual Disrupt conference, offered to help new companies test and develop products, and even invested money in promising start-ups, with the hopes of exclusively selling their technology.
Best Buy, though, has been retreating from these initiatives as CEO Hubert Joly focuses the company’s resources on fixing core store operations. But given its large store count — 1,000 stores in the United States alone — Best Buy already presents an attractive destination for a start-up that wants to quickly distribute a product to a national audience.
“Best Buy’s partnership with us is a big step toward meeting [consumer] demand,” Pebble CEO Eric Migicovsky said in a statement.
“The outpouring of support from our Kickstarter backers was the first signal to our team that the [watch] was something the world was ready for,” Migicovsky said. “We’ve learned that people want [the device]. Thanks to Best Buy, we’re giving folks more ways to make that happen.”
Pebble also reflects Joly’s strategy of working with vendors to create excitement in the stores. The retailer recently formed partnerships with Samsung and Microsoft to create “store-within-a-store” concepts in Best Buy’s big boxes.
Retailers like Best Buy also crave exclusive rights to sell new products. But major manufacturers often balk at the idea, partly because they don’t want to limit their distribution reach and alienate other retailers.
“Exclusivity limits availability to the customer,” said Ketrina Dunagan, vice president of retail marketing for Samsung America, in a recent interview. “Our approach is the opposite.”
But a small start-up like Pebble can get instant access to Best Buy’s giant customer base. In return, Best Buy can brag about being first.