The war for wearable dominance is heating up, and the team at Fitbit is making a power play for top position.
On Monday (Aug 28), the news dropped that Fitbit is officially releasing a smartwatch of its own called the Ionic, which goes on sale in October. Fitbit, of course, is best known for its relatively low-priced fitness tracking devices, though the Ionic is technically not the first device offering it has made that has some watch-like function. That honor went to the Blaze, which came out last year.
To further tempt them in, developers will also have full access to all the sensors built into the device, including heart rate, GPS, accelerometer and more.
It’s a big move and with it comes a fairly notable price jump for a device that until now hadn’t been known for its priciness. The Ionic will debut on the market at a $299 price point; more expensive than the first edition Apple Watch (though still less expensive than the Apple Watch Series 2).
But will the investment and the upgrade end up being worth it for Fitbit? Is the world ready for another pricey wearable device?
It’s an interesting question and one with an answer that might surprise.
The Power Of The Wearable Customer
Wearable have gotten a lot of press and positive spin over the last several years; but it’s hard to say that they’ve really caught fire the way smartphones have. There are consumers buying wearables, particularly fitness enthusiasts who are the Fitbit’s core audience, but consumers haven't taken to them quite the way they’ve taken to smartphones, which have become nearly universal over the last 10 years.
Wearables have been written off by some, particularly cynical tech market watchers, as a persistent case of much ado about nothing.
But, when PYMNTS and Visa took a deep dive on the subject with a comprehensive study of 2,600 consumers for the How We Will Pay: Deep Dive into Wearables study, we found a very different picture of wearables coming into focus.
Overall, wearables are more inclined to embrace technology and hardware across the connected device spectrum. Consumers who own wearables own more devices than those who don’t, with 5.5 connected devices owned versus 3.2 devices across the two groups. Wearable enthusiasts are also much more likely to make use of voice-controlled assistants such as Amazon Alexa, with a 20 percent use rate. Those who don't own wearable technology tap into the wonder that is voice activation less than 10 percent of the time.
Wearable wearers are also more likely to shop and buy things online, with 45 percent reporting such behavior versus the 40 percent of non-wearable users.
More notable than the behavior statistics perhaps, was the data on how very ready consumers seem to be for a wearable (and connected device) enabled future.
A full 60 percent of respondents polled reported that the friction involved in shopping, either online or in store, has rendered the experience unproductive, unpleasant and inefficient; 66 percent of respondents said they would be willing to use a connected device to shop if it could bring them a more frictionless shopping experience; and 85 percent noted reducing friction at the point of sale was a key reason to pay via connected device.
Consumers who so far have not rushed out in droves to own a wearable have demonstrated that they are very much ready for an upgraded and less friction-filled commerce experience and that they are ready to give wearables a chance if they can do two things: Make commerce run more smoothly on the front end and make sure that that speed and smoothness doesn’t come at the price of security on the backend.
And with the duel announcements for Visa and Mastercard about how Fitbit Ionic will enable a variety of forms of contactless tokenized payments, it seems consumers may be getting more of what they asked for.
Visa & Mastercard Upgrade Fitbit's Commerce Capacity
As the Ionic was being announced, news also came down the wire that one of the ways payments would be made possible on the new platform will be via Visa’s Token Service, which uses a unique digital identifier in lieu of the data that would traditionally span cardholder information, such as account numbers and card expiration dates.
“Visa continues to focus on delivering the tools and technologies that empower our partners to offer safe, secure and convenient payments to consumers via connected devices,” said Jim McCarthy, executive vice president of innovation and strategic partnerships at Visa, in the news release. “Partnering with Fitbit on its new Fitbit Pay service is another step forward in the growth of [the] Internet of Things and shows how Visa is enabling companies across the technology industry to help us all move [toward] a cashless future.”
In terms of process, users load their Visa debit or credit cards into the Fitbit mobile app. Fitbit owners then complete transactions by holding the Ionic smartwatch near a near field communication (NFC)-enabled terminal.
Shortly after that announcement, Mastercard followed up with one of its own. It too will be enabling access to secure tokenized payments by allowing users to load the Mastercard debit or credit cards into the Fitbit mobile app and pay using the same NFC mechanism.
By adding mobile payments capability to Fitbit Ionic, Mastercard said it is ensuring that everyone everywhere has the ability to make and receive secure payments using any connected device across a number of different verticals, such as wearables, connected cars, smart home and retail.
“Consumers today are expecting technology to help them accomplish life’s daily tasks with as few steps or clicks as possible,” said Kiki Del Valle, senior vice president of commerce for every device at Mastercard, in a press release. “By adding payment capabilities to a Fitbit device, Mastercard cardholders who are already on the go can easily buy what they need without having to bring their wallet with them. It is all about the technology, infrastructure and convenience all working together for the consumer.”
But will this work for the consumer in a way that it hasn’t yet, and will consumers be willing to pay to find out?
That remains the big question mark going into October as the device readies for sale and prepares to go head to head with the newest Apple Watch also set to be released just in time for the holidays.
We’ll keep you updated on what the winning wearable shapes up being.