A few days ago, MarketWatch.com reported the sales of Apple’s (AAPL) latest technology have declined by 90% since its opening week. The data provided for the report came from the relatively new, Palo Alto based, market-research firm Slice Intelligence. According to data from Slice, Apple has been selling fewer than 20,000 Apple Watches per day in the United States since the initial rush in April; on some days, fewer than 10,000 are sold.

The report was followed up to discuss the potential factors that might be contributing to the decline in Apple Watch sales. The highlight of the article comes from Endeavor Research analyst Richard Windsor. “Apple’s failure to come up with a compelling use to which the device could be put is the single biggest reason it is underperforming,” Windsor said.

MarketWatch pairs this quote with added context from Windsor by stating he “emphasized that the hardware itself shoulders very little blame for any Apple Watch underperformance, adding that wearables in general can be expected to ‘massively underperform the hype’ until the search for compelling long-term uses yields results.”

Whether or not the Slice data is potentially questionable due to Apple not releasing data on Apple Watch sales, or if the product is losing momentum to beat its estimated earnings, Windsor is raising a marketing issue for Apple, that is their inability to persuade potential consumers to purchase a smart watch.

The question now becomes for Apple and its smart watch competitors, such as Samsung (SSNLF) and FitBit (FIT), is how does one make and market a “compelling” watch? 

At their very core, watches simply tell time and brands like A. Lange & Söhne, Piaget, Harry Winston, and Rolex all continue to excel,  as well as show no signs of decline despite the added competition.

Currently, the cheapest Apple Watch costs about $350 and provides applications such monitoring heart rates, notification alerts for text messages and emails, weather information, ApplePay, and of course, keep time. It is essentially a fancy watch that compliments a user’s phone very nicely.

The issue on Apple’s side is not finding a way to make the Apple Watch compelling, rather its price point for what the watch does. It performs the applications of any smart phone at a rudimentary level.

Since the watch does not have the capability to replace one’s smart phone, that is using it for communication, along with being too expensive for its core function of telling time, the Apple Watch is caught in state of purgatory where there is no genuine reason for the consumer to justify the need for it.

If the consumer is looking for a basic health watch, FitBit’s Flex watch costs $99.95. If the consumer is a runner looking for a smart watch with GPS, Garmin’s (GRMN) Forerunner 220 costs $249.99. If the consumer is looking for a simple timepiece, then he or she can go to countless retailers to find a decently priced and stylish watch. There are other options. Furthermore, Android users cannot pair the Apple Watch with their cell-phones, eliminating a large percentage of the consumer pool.

The concept of “compelling” is the fault of the consumers because they built up lofty expectations for what the device was going to perform and what the device currently does. It is not C-3PO or R2-D2. It cannot project 3-dimensional holographic images of princesses in distress or add snarky commentary during perilous situations. The Apple watch is merely a complementary interactive interface, an accessory for the iPhone.

This news of Apple Watch sales declining coincides with sales of Apple’s iPad plunging as well. Despite the potential lack of success, there is still room for the Apple Watch to grow and be improved upon. Maybe the next generation of Apple Watches will have wi-fi capability, or even in the next few years, replace the cell-phone entirely, reimagining the very concept of mobile communication. Let’s wait until the 2015 fiscal year finishes up, allowing the holiday season to happen, before pronouncing the Apple Watch a failure or not “compelling.”

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
APPLE INC (AAPL): Free Stock Analysis Report
 
GARMIN LTD (GRMN): Free Stock Analysis Report
 
FITBIT INC (FIT): Free Stock Analysis Report
 
SAMSUNG ELE LTD (SSNLF): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research