The iPod, iPhone, and iPad redefined (you might even say created) their categories. People have argued that tablets are fairly useless in the end, but the iPad still made tablets mainstream and is arguably still the best tablet.
The watch did none of those things. I saw lukewarm reviews at best, and I've never met anyone who raved about having one. Capturing 70+% of the smart watch market is probably more a function of demographics, since a smart watch is a huge luxury, than of the quality of the product.
How much better would Apple have to do? It would have to make smart watches mainstream. For VR, it would have to make VR mainstream. That's the bar that they set in the past.
(Note that I despise Apple and am certainly not just being nostalgic.)
