The trick is that the phone is a lousy device for consuming notifications. You're either tying up your hand holding it or it's sitting in your pocket and not actually helping. Comparatively, the watch can pass notifications while leaving your hands free, allowing you to get things done.

In the sordid tradition of technology prognosticators, I'm going to make a prediction: there will never be a strong game market for the smartwatch like there was for the smartphone. Games work on the phone because the phone is what you stare at when you're bored. The smartwatch isn't for when you're bored, but rather for when you're busy, so there's no point in gaming on it.