1. Ensure your zw3 with at least 80 percent battery, and connect your watch to power adapter.
2. Go to SEtting-> about -> system update.
3. Tap the green screen rapidly, some said 2min, my experience just keep tapping around 30second, it will be trigger the download to update AW2.0.
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4. The download screen will take time. My situation is 1 hour.
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5. Your watch will auto reboot after finish downloading.
6. You may notice your watch may come across "Continue setup on phone" for more than 15min, yes.. is abnormal. i check my phone has no prompt error / setup screen.
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  6.1 In this situation, check your phone,  Settings » Apps » All apps-> android wear app, it must be version 2.0 or
        above, else please perform apps update.
  6.2 In your application list, check your Google Play services app is version 9.8.41 or above, else please perform apps
        update.
7. if both apps version are met still same issue, reboot your phone and watch together. (in my case it works after reboot)
8. After both devices reboot, your phone should come across this page, where it prompt you to copy google accounts info to zenwatch.
9. Your zenwatch should be updated completed.