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Wearable Devices, The Next Big Thing?

Wearable Devices, The Next Big Thing?

Wearable devices have been hyped as the next big thing for years, but are we finally entering into this brave new world? The evidence suggests yes. With new products and apps launching all the time, and the market expected to grow by more than 50% in the next three years, wearable devices are poised to revolutionise the consumer and business world as we know it. 

So to understand where wearables are going, we need to look at how and why they have evolved.

In this blog post, Nerd takes a deep dive into the history of wearable devices, their current use cases, and where they could develop in the future. We’ll also explore the potential benefits and challenges for wearables in marketing.

So whether you’re a marketer who’s curious about wearables, or just someone who wants to learn more about this exciting technology, read on!

Wearable Devices Introduction

At the Japanese Olympics in 1964 a marketing message was communicated by a pedometer manufacturer that taking 10,000 steps a day was the secret to a healthy lifestyle. As explained by Professor David Basset at the University of Tennessee, this message had no scientific backing, but as it was so simple to understand it caught on.

More than fifty years later, the 10,000 steps myth has become part of the zeitgeist and had the unintended consequence of creating the major use case for the adoption and commercialisation of internet-enabled wearable technologies like the Fitbit and Apple Watch. Modern consumers are entering the era of ‘the quantified self’ and are increasingly adopting the mega trend of health, wellness and wellbeing as a way of life, with wearable devices and apps making self-improvement and fitness more convenient and fun.

Businesses are assessing how wearable devices can increase employee productivity and reduce staff sickness. Governments are looking for new ways to motivate people to adopt healthier lifestyles due to costly healthcare challenges such as ageing populations and obesity.

The consumer electronics industry has been placing increasingly faster computer processing power inside smaller devices. Today, sensors and internet-enabled components are small enough to be housed within watches, wristbands, glasses, and other worn devices – something that has given birth to therapidly growing wearable technology sector.

Wearables are now a key part of the emerging ‘internet of things’ ecosystem. In combination with big data, cloud computing, and data analytics, we are about to witness a myriad of new applications that could revolutionise business and consumers’ lives.

However, these advances may also present adverse unintended consequences for society which have been popularised by recent sci-fi programmes such as Black Mirror. Breaches in cyber security, unauthorised access of personal data and the increasing psychological problems for people in an ‘always on’ era are hot topics where the innovators in this brave new world need to give careful thought and consideration.

The Rise of Wearable Devices

In their academic paper, Canhoto and Arp define today’s wearables as machine-to-human internet of things devices, embedded with internet technology, with the capability of collecting, storing and transmitting data. They include smart watches, wrist bands, hats, smart glasses, healthcare wearables, lenses, smart fabrics with many more innovations appearing almost every day. 

Did you know this? Pre-internet, the first smart wearable was designed by Edward Thorpe and Claude Sharman. They created a smart shoe that concealed a computer timing device that was able to predict where a roulette ball might land and increase the chance of winning at the casino by up to 44%! 

In the decades that followed consumers began embracing wearable technologies such as the Pulsar calculator watch in 1975 and Sony Walkman in 1979 In 1981, Steve Mann, placed an Apple II computer within a backpack to control photography equipment attached to a helmet. 

Now known as the father of wearable technology, Steve has pioneered many innovations in the field of wearable computing. He created the first wearable wireless webcam in 1994 and became known as the first ‘life-logger’. 

Since the 1990’s, many new devices with enhanced functionality and applications have entered the market. In 2003 the Garmin Forerunner was the first performance tracking watch for athletes, in 2012 Pebble released the first smart ‘internet-connected’ watch and in 2014 Apple launched its first smart watch. Whilst Apple is very protective over its sales of devices, it is believed that unit shipments of Apple Watches exceeded 100 million units by June 2021. 

Digital strategy firm Endeavor Partners explain that “smart wearable devices have finally moved from a niche product just a few years ago to a mass-market product category”. 

But it’s not all plain sailing for the industry. Haider Raad states in the wearable technology handbook that “compared to smart phones, tablets, and laptops, which were swiftly embraced by consumers, wearables are being adopted on a relatively slower pace”. We will see later that abandonment rates for these devices are high and in its hype cycle model the IT consulting firm Gartner placed wearables in the ‘trough of disillusionment’ for a very long time. 

However, despite this slow start, in a 2023 survey conducted by Statista it was revealed that India leads the way with 45% of respondents having used a wearable device in the past year, closely followed by 41% in the United Kingdom and 40% in China. The technology has therefore entered the ‘early majority’ stage of its development and could witness accelerated growth as the share of populations owning one of these devices rapidly increases.  

The global wearable technology market was valued at USD 61.30 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 14.6% from 2023 to 2030.

Wearable Devices privacy and security concerns

Cloud computing, the internet of things, and big data are the enablers for smart wearables, but also create a host of privacy and security concerns. 

In the USA, the Federal Trade Commission stated that while wearables can promote wellness, convenience, and better health services, they are also “collecting, transmitting,  storing – and often sharing – vast amounts of consumer data and therefore creating a number of privacy risks. The FTC’s report goes on to state that wearable devices challenge traditional privacy principles and pose a considerable risk to the security of the collection, use and storage of personal health, location, financial and other sensitive data”. 

Companies in a rush to get a wearable device or app onto the market should be wary, as Gary Davies of Intel security states that the information stored on a wearable device is “worth ten times that of a credit card on the black market”. They are also easy to hack, with weaknesses within the device itself, Wi-Fi and Bluetooth connections and where the information is stored on the cloud.

Despite these concerns, in a study by the accountancy firm PwC, 70% of consumers said they would wear employer-provided wearables streaming anonymous data to a pool in exchange for a break on their insurance premiums. 

A similar finding was found in the journal Adoption and Sustained use of Health and Fitness Wearables. Here, all 20 participants in a focus group stated they would accept an employer-provided wearable provided they did not have to share their personal data with the employer or insurance companies. 

So is this good for business and consumers? 

According to IT consulting firm Gartner, around 10,000 companies across the world offered the use of fitness trackers to their employees. The company Humana uses wearables to reward fitness activities with lower insurance premiums, gift cards and health devices. A three-year study showed that employees using this scheme witnessed a 44% decrease in sick days. 

However, in the best-selling book Black Box Society it was revealed that some employers are already abusing these technologies with one example of a hedge fund that uses Fitbits to track how much their traders eat and drink to correlate how they will trade the following day. Scary! 

For adoption to fully take place, there is a very fine line between the benefits of wearables on health and productivity and the fear of a loss of privacy and/or security breaches.

In Tapping into the wearable device revolution in the work environment the authors reinforce this point very clearly:

“Wearables present many legal, social and ethical implications, which in turn could lead to reduced productivity and efficiency. It is imperative that any stakeholders involved must not take advantage of a wearable device’s power to infringe on an employee’s right to privacy at the risk of causing both direct or indirect psychological harm”.

Indeed, employers introducing wearables for staff self-improvement should also be mindful that constant interruptions from this technology can prevent people from concentrating on a single task, which can elevate stress levels and anxiety. Recently, in a Skinnervian nightmare, heavy users of smartwatches have even been found to gain a ‘phantom watch’ effect, constantly checking their wrists even when they are not wearing the device.

Are wearable devices improving healthcare?

Wearables have been enjoying a steady rate of adoption – mostly in the fitness band and smartwatch categories – with consumers utilising new features such as heart rate monitoring, sleep tracking and step-counting. 

The technology works best when these devices are gamified, with human-centred designs focused on the psychology of motivation to drive behavioural change, especially in areas such as healthcare, fitness and personal wellness. 

It is estimated that one in six people born today will live until they are 100,which poses a serious burden on global healthcare services. Ageing populations – together with other modern health issues such as obesity – increase the risk of chronic diseases which are extremely costly for society at large. For instance, Montgomery, Chester and Kopp found that obesity-related illnesses cost American businesses $73.1 billion per year in medical expenses and lost productivity. If wearable technology can motivate people to adopt a prevention over cure mentality, then all privacy and security issues must be overcome to ensure the continued adoption and use of these devices. 

Increasing wearable technology adoption and use cases

In Ana Viseu’s paper Simulation and Augmentation; Issues of Wearable Computers an argument is put forward that wearable device adoption will only take place if these devices are: 

  • Reliable – must never breakdown
  • Secure – confidential nature of the data means that connections must be secure 
  • Safe – must be proven that it is not harmful to wear 24/7 

However, adoption is not the only issue as Ana Isabel Canhoto’s research states that “the benefits of wearables will only be realised if users adopt and continue to use these devices as opposed to abandoning them shortly after purchase”. 

This could be the major issue for wearable technology. Research conducted by Gartner revealed that 30% of wearable devices are abandoned because consumers do not find them useful, they get bored or they break. 

<] style="font-weight: 400;">However, the growth trends suggest that as these devices are becoming smarter, gain more features and become trusted as a day-to-day tool they will become essential technology for consumers. 

A great example is cWatch, a wearable device for workers in the retail sector. This wearable device provides retail and warehouse workers to send voice messages and communicate with any connected team member. The transfer of information happens seamlessly in the background, improving productivity and the customer experience. 

So, what could be the 10,000 steps of tomorrow?

Crowd-based social change using wearable devices, and conclusion

In the book Mapping and the Citizen Sensor the authors explain how volunteered geographic data collected from wearable devices can be used for large scale scientific projects that need a regional, or even global-wide, coverage to unlock the power of the crowd. 

Whilst we explored the potential negative aspects of these developments from a privacy and security standpoint, when these wearable technologies are combined with social media, the internet of things and location tracking, the volumes of data that can be collected are immense. This opens the door for the average person to become a ‘citizen scientist’.

An example of this in action was researched by Chrisinger and King where biometric sensors were given to citizens in San Francisco to measure the relationship between the volunteers’ stress levels and their environment. 

A limitation of this research was that only 14 people were involved, however the methodology used was effective and could be scaled-up to uncover more ways to understand the causes of stress in urban environments, which can be a precursor to depression and other chronic illnesses.  

To conclude, wearable technology is going to be increasingly adopted by businesses and consumers and is on a current trajectory towards mainstream adoption in the next decade. Whilst this will undoubtedly reveal potentially negative unintended consequences for society through abuses of privacy, psychological ‘always on’ issues and security breaches, there is also huge potential for individual self-improvement, a healthier society and the sharing of vital information for the benefit of mankind. 

An area of research that deserves further enquiry should explore how businesses could work with academia to adopt citizen science projects with their people as part of their corporate social responsibility programmes. Would employees adopt wearable technologies – to not only improve their health – but also to become citizen scientists who research the big topics of today such as health and wellness, climate change and urbanisation with their volunteered geographic data. Nerd looks forward to working with start-ups, entrepreneurs and businesses that launch such services for the betterment of our environment, society and individual lives.

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