Healthcare

Fitness Tracker Incentives And The New World Of Health Commerce

On the surface, the idea seems deeply pragmatic  a thought that comes straight from the storied intellectual school of “well, duh!” and a tradition that reveres Captain Obvious as the paragon of philosophical truth.

Yes, it seems very smart to use fitness trackers, such as the Apple Watch and Fitbit devices, to encourage people to exercise more. Those trackers can engender not only better health (and, most likely, opportunities to buy exercise gear, nutritious food and associated goods via mobile commerce), but insurance discounts tied to wellness. Insurance providers love data, consumers love lower prices, manufacturers love to move units and — how to put this as politely as possible? — Americans love their cheeseburgers and salt, and their comfy couches while binge watching TV or playing video games.

However, as fitness trackers find more acceptance among consumers, the medical profession and the insurance industry, and become more important to companies’ bottom lines, the rise of such technology brings forth two important questions. First, what incentives offered via those fitness trackers actually result in consumers adopting healthier lifestyles — what really works? Second, will the types of consumer demands now driving the development of fitness tracking technology clash with the science and psychology of human behavior and response?

Fitness Tracking Growth

Those questions aren’t academic.

Consider the recent news, reported by PYMNTS on Wednesday (Nov. 28), of a global study conducted for Vitality Insurance that revealed people will exercise more if they are given a reward, such as a great deal on an Apple Watch. Adrian Gore, founder of Vitality Insurance, said the findings could motivate financial services companies to change their business models to reward clients in the same way.

That study will provide more fuel for the building trend of insurance companies using fitness trackers to know their customers better, encourage them to be healthier and craft policies in response to the data collected by the devices. Among the fresh developments in that area is Humana’s late September announcement that it would use Fitbit Care, a recently released wearables platform from Fitbit that “combines health coaching and virtual care.” This stems from Fitbit’s acquisition earlier this year of Twine Health, the health coaching platform that aims to help people achieve better wellness outcomes.

Fitness tracking represents serious revenue and business opportunities, especially for insurance. As demonstrated in a new PYMNTS Deep Dive of data surrounding this issue, 40 million fitness trackers were sold in 2017, and 71 million smartwatches shipped this year. Based on current trends, the market is projected to reach $27.4 billion by 2022 — a sign that consumers are fully embracing the 24/7 insight into their personal health.

Incentive Challenges

Fitness has always involved incentives, even before the digital age.

Indeed, a developer who recently recalled the challenges he faced with his own fitness tracking app pointed out that “people were rarely working out … purely for themselves. They almost always had a ‘why’ that was related to something other than fitness that kept them motivated. Things like ‘so I can play with my son more’ or ‘to lose 10 pounds for the wedding I’m [attending].’” Unfortunately, he continued, “our app never gave people a reason why. So, our app was dead in the water.”

It’s hard to say with a straight face that the fitness incentives offered by mainstream devices and apps tend to provide the “why.” More accurately, they provide rewards — some positive feeling or form of payment for doing specific fitness tasks or achieving specific goals (with the “why” presumably coming from the consumer’s doctor, spouse, friends or own reasoning). Fitness trackers also offer consumers the chance to see what other people in their chosen group are doing when working toward their own wellness goals — but that’s competition and peer pressure, not a “why.”

Incentive Payments

Take Sweatcoin, which is often touted as among the hottest properties in this area — and which describes itself as “the app that pays you to get fit.”

The app’s incentives are rewards that users can redeem toward purchases at real stores. Oleg Fomenko, co-founder of Sweatcoin, said the app uses movement and location trackers to make sure users aren’t trying to game the system to earn more rewards than they’re due, and pegs its perks to bitcoins  also called sweatcoins to ensure stability. Users have sought to sell their sweatcoins for cash, too. Sweatcoin, in turn, gains consumer data, its own form of treasure.

Another monetary incentive has UnitedHealthcare enabling customers to earn up to $1,000 a year if they meet daily walking goals, with progress recorded by the Apple Watch.

“After paying tax and shipping, anyone enrolled in UnitedHealthcare Motion can get an Apple Watch Series 3 and have the option to apply earnings from the program toward buying the device,” according to a description of the program. “After that, their earnings are deposited into their health savings account or health reimbursement account to help cover out-of-pocket medical expenses.”

Money — whatever form it takes — would seem to work as a reasonably reliable incentive for fitness tracking. At least, that was suggested by a peer-reviewed study released last year via BMC Public Health, which found that corporate wellness programs that involve payouts to employees can work well toward getting them to meet all their fitness goals.

Algorithms And Science

When it comes to fitness trackers, the proprietary algorithms that power those devices are not necessarily based on science, or even consultation from medical and health experts — a point noted by various observers, including in a recent article from The Verge.

That means the incentives offered — money, badges, praise from friends who also use a specific device — are not necessarily designed to reflect the reality of human behavior and response in specific fitness situations. Indeed, as the report noted, many fitness tracking rewards celebrate success, not the effort. As nearly anyone who’s worked out understands, even failed but full-hearted attempts at achieving a goal deserve honest compliments, which then help to ensure the effort continues.

In fact, there are few scientific studies that can point to clear, non-contradictory best practices when it comes to the best incentives for fitness tracker users, according to reports. Much of what is known — well, known on a deeper level than is the case for those trackers — comes from experiences with employee wellness programs.

Personalized Incentives

One big lesson? Incentives cannot really come as a one-size-fits-all — and that’s the point where the Apple Watch and other devices are, generally.

“People who maintain healthy behaviors are not motivated to do so by a gift card, or a discount on their health insurance, or a T-shirt,” according to a recent analysis from WellSteps, an employee wellness solution provider. “Those who adopt healthy behaviors for the long haul are most likely motivated by the benefits they get from being healthy. When people internalize the benefits of a healthy lifestyle, they are more likely to keep those habits for the rest of their lives.”

That’s not the only challenge facing more mainstream users of fitness trackers. As The Verge put it, rewards often “happen at a distance from the behavior they’re meant to reinforce, weakening their effect.” That is, there is no live trainer or workout buddy, for instance, giving one praise after they just finished 10 extra minutes on the treadmill. For people already dedicated to a healthy lifestyle, that might not be a big problem. For those trying to get healthy, those making significant lifestyle changes, that could lead to discouragement — and even less use of the fitness tracking device or app.

The main message from all this?

Human behavior is complicated, and often contradictory. No one has yet hit on the secret sauce (or sauces) that can apply to fitness tracking in a digital and mobile world. That said, retail has a long experience in crafting incentives to attract and retain customers. Retailers already grasp the power of personalization — one area in which incentives will very likely need to improve. All that, and the increasing interest from the insurance industry in fitness tracking technology, makes certain that more incentive experimentation — and perhaps even solid, best-practice success — will emerge in the coming months.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 Pay Advances: The Gig Economy’s New Normal, a PYMNTS and Mastercard collaboration, examines pay advances – full or partial payments received before an ad hoc job is completed – including how gig workers currently use them and their potential for future adoption.

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