Trends and forecasting
4 MIN READ
4 MIN READ
3 MIN READ
Expect to hear a lot about wearable technology in 2014. Innovators and marketers are betting on wearables, and it will be up to consumers to decide if wearable technology makes it to the mainstream. There is no shortage of hopefuls in the race to become the next must-have item. Tech giants like Google and Samsung, plus a sizable number of little known start-ups, are quickly ramping up on wearable tech. Along with smartwatches, consumers will be able to choose from a wide array of other wearables, including everything from eyewear to socks. All the attention is not misplaced; consumer sentiment is primed for wearable innovation. Over the past five years a growing number of Americans have embraced technology as making life easier, making them feel connected, and enabling creativity . Yet, despite all the hype around wearables, they remain a niche, and while seemingly poised to enter the mainstream, some key hurdles lay ahead.
The jump from novelty to mainstream can be difficult, as described by Geoffrey Moore in Crossing the Chasm. Just a few short years ago, we read about 3D TV taking over our living rooms. Now, many companies have shifted focus to 4K Resolution. As 3D TV has shown us, devices simply being available on shelves is not enough; consumers need to buy-in.
Are consumers willing to invest their time and money to take wearable tech mainstream? Have innovators and marketers made a strong enough case for why consumers should care? The answers to these questions may not be a clear yes or no, but rather not yet. As the technology we use everyday begins to take on new form factors, a world of possibilities opens, not only for how we interact with our devices but how we interact with the world around us. The inherent promise of wearable technology aims to push that blending of life and technology to the extreme. Consumers will be weighing-in on the value of these innovations as they make their decision and determine if wearable technology will live up to the hype in 2014. With the right design and marketing, wearables might just be up to the task.
How Can Wearables Demonstrate Clear and Convincing Value?
Make It Different
One of the largest barriers to mainstream adoption will be presenting consumers with a strong value proposition – one that differentiates wearables from the smartphones that many already own. Smartwatch research completed by GfK among US and UK consumers found that, along with price, a lack of distinct consumer benefit was a key barrier to adoption. While health and fitness wearables like Fitbit and Nike Fuelband have had success in demonstrating over-the-top value, the niche category more naturally differentiates itself from a smartphone’s functionality. One of the most prominent wearables, the smartwatch, will have a more difficult road. Many of the tasks currently touted by smartwatches are just as easily accomplished on a smartphone. An argument can be made for the smartwatch’s convenience, but we must also consider the inconvenience of a smaller screen and limited functionality. With market entry for smartwatches in the hundreds of dollars, demonstrating over-the-top value and functionality beyond what is available to consumers with the smartphone will be critical.
A key detractor of over-the-top value is the perception, and reality, of wearables as a companion device. GfK’s smartwatch research showed that consumers prefer a standalone solution. Yet, many current generation wearable devices still require a smartphone, forcing consumers to remain bound to their current ways of interacting with technology. Independent connectivity can unlock value for wearables. Once free from smartphones, wearables can flourish - better delivering on the promise of uniquely blending lifestyle and technology. To make it to the mainstream, wearables can’t be sold with the same value proposition as smartphones – it must be clear to consumers why wearable technology is different.
Make It Intuitive
While we immediately associate the cost of wearable tech to a price tag, we cannot forget about the substantial time commitment that consumers will undertake to learn how to use the device. A massive amount of computing power is being built into smaller and smaller devices, and the real estate for how consumers interact with their device is at a premium. The simplicity of swiping across the face of a watch or tilting your head upwards, as in the case of Google Glass, is lost if the movements are not intuitive. The need for intuitive design cannot be understated as half of Americans say that if a new technology product is not simple to use, they lose interest in it .
For wearables, intuitive design takes on additional complexity. It is not enough to consider the interface as you are sitting in a test lab giving the device your undivided attention. The interface must be intuitive in the environment that wearables are intended to be used – on the go and in everyday situations. Voice commands and tactile feedback become increasingly important. Commands need to feel more natural – movements or swipes rather than button presses. Wearable innovation necessitates that design and user experience evolves with this new category of devices. After all, with wearables we are infusing technology into our lives, not taking a break from our lives to use technology.
Make It Compatible
The average U.S. internet household now has 5.7 connected devices , and with continued advances in the connected home that number will only grow. On top of that, consider the technology that we encounter when we step outside each day like near field communication (NFC) and location based advertising. Earlier I referenced making wearables different from smartphones, and by making wearables compatible we can make them different. Imagine sitting at home and having your thermostat use your body temperature (measured by your smartwatch) to regulate the climate. Or walking out of the house without needing to grab your wallet or keys because your sunglasses have a NFC chip that can unlock your doors and hold your credit card information. A little bit cooler perhaps, but importantly more useful than being able to look at your email without taking your phone out of your pocket.
From the power user to the most casual user, consumers will be looking for their wearables to integrate seamlessly into their lifestyle. Independent connectivity should be the goal, but until it arrives compatibility across OS and manufacturer takes on an even greater importance. Compatibility issues only serve to further limit the potential consumer base. Beyond that, if a consumer spends hundreds of dollars on a new piece of tech – they want it to work with all their existing stuff. If that is not the expectation, then they’re likely buying it for novelty or niche and that is not the road to mainstream adoption.
Make It Fashionable
We must not forget that people are going to be seen in public wearing these devices. While technology can influence style, innovators and marketers must recognize that consumers may not want a big, clunky smartwatch on their wrist. In fact, 55% of US consumers agree that the look and style of a technology product is very important in deciding which one to buy . To enter the mainstream and appeal to a broad range of consumers, we need a broad range of choices. An intuitively designed, functional device will struggle to succeed if no one wants to wear it. Of course this is important for our phones as well, but when they are not hidden in our pockets they can be wrapped in a seemingly never ending aftermarket of covers, cases, and accessories. Wearables are meant to be seen, which means that form cannot be lost to function.
Beyond being fashionable, there will be a demand to make wearable devices as unique as the people putting them on. Like traditional watches, glasses, and jewelry they would ideally allow the wearer to express who they are as individuals. Consumers are no less likely, albeit potentially a bit more forgiving, to want wearables to reflect their personal sense of style. This is not to say device manufacturers have to directly offer a style for every consumer, but they must consider the ability to personalize the devices they send to market. Do devices easily accept a cover? Does it take an engineering degree to remove the band from your smartwatch? Wearables must be designed so that they can be personalized. A boom of aftermarket accessories is sure to follow a successful device launch, and consumers will see the value of a brand that lets them be unique.
Drive Adoption with High Value, Not Low Prices
An improved value proposition is going to be a cornerstone of success for wearables, but we cannot ignore another barrier to adoption - price. Many of the items discussed above are not cheap endeavors. Hardware for independent connectivity along with design teams to deliver more over-the-top value will quickly rack up invested costs that need to be recouped. As devices are already pushing hundreds if not thousands of dollars, we need to be realistic with regard to consumers’ willingness to pay more.
One approach may be to leverage wireless carriers. While independent connectivity introduces additional pricing challenges by driving up the cost of manufacturing, there is potential upside. Wireless carriers may be interested in offering subsidized pricing into data sharing or individual data plans, lowering the total cost to consumers. Also consider that consumers will pay for value. Despite an aversion to paying for new technology, 63% of Americans are prepared to pay more for products that make their life easier . If we can make wearable tech different, intuitive, compatible, and fashionable there will be a consumer market – even at a higher price point. Not just because it is new and cool, but because the purchase will drive significant value in consumers’ lives. However, if we cannot make wearable tech deliver this type of over-the-top value, there may not be a price point low enough to take wearables from novelty to mainstream.
 Roper Reports US / Roper Reports Worldwide; Spring 2011 - 2013
2 MIN READ
Innovation and Digital
2 MIN READ
Trends and forecasting
4 MIN READ
4 MIN READ
3 MIN READ
Subscribe to GfK Insights