Mini-Case How to Design an Attractive Wearable A large electronics manufacturer

Mini-Case How to Design an Attractive Wearable
A large electronics manufacturer wishes to issue a new “wearable” like a Fitbit or an Apple Watch. It will essentially be a wearable smartphone that can capture exercise efforts and heart rates, and of course offer the usual phone capabilities of placing calls, playing video games, online e-commerce and Web access, credit card or bank debit payment at local retailers, and of course grabbing GPS information to provide mapping and travel and entertainment recommendations. Other wearables are moving toward this merging of a simple wearable and a smart phone functionality, but this manufacturer wants to lead the efforts and come out ahead in providing still more services.
Wearables vary in many ways, including their appearance. Initially, the brand management team proposed to issue a design that looked like a very small smartphone to be worn as a wristwatch. On the one hand, the team recognized that maybe that wasn’t a good idea because the Apple Watch already looks like that, and yet on the other hand, there are worse things than to possibly be confused with an Apple.
Alternatively, the wearable could be designed as a small headband with earbuds like music headphones or speakers. (There was a third option that was considered for the wearable units to be an add-on to glasses, but the team was concerned that doing so would be difficult, if Google Glass has been developing such a thing and it hasn’t yet taken off. So the glasses idea was put aside.) While the earbuds had the advantage over the wristwatch of not looking like Apple, early prototypes suggested that while it was good at capturing GPS, it wasn’t as versatile in supporting multiple apps, and it wasn’t as precise as exercise (step) counters (e.g., the head didn’t move as distinctly as the user’s wrist while walking). At this point, the brand team wasn’t sure how to go forward in choosing the design to launch the ideal product.
Regarding pricing, the company wants to create the wearable such that it will make money with the purchase of the unit, of course, but that it will also make money as its customers use it, leasing various services, again, more like a phone with data and call plans, and something that Fitbit subscriptions and the Apple Watch (in coordination with Apples iPhones) are providing. In addition, the company would like to capture data about the customers’ profiles, in terms of their activities, spending patterns, and so on to further strengthen its own recommendation algorithms.
Given the still relative novelty of wearable units, the company thought it should charge on the high end, about $500, maybe even instituting a small annual fee. To get supplementary data, they thought they’d issue periodic surveys, about once a month, via the unit or the consumer’s email.
The youngest marketer, newest to the team, asked, “Well, that’s good for us, but how is it attractive to our customers? Why would they want this unit—when there are plenty of others out there?” One older manager shot out a withering look. Well, that’ll teach someone who is less experienced from speaking up in the meeting. But the senior-most manager spoke up and said, “Well, you’re right, we’re only looking at it from our point of view. What would this wearable look like that our customers would want—and that can be profitable to us?”
What would help these marketers? What steps could they take to design a wearable that would be both optimally appealing to its customers (and perhaps attract new customers), as well as optimally profitable?
There were many possibilities: Should the unit look like a small smartphone wristwatch or a small headband with earbuds? Should the apps be accessed by touch only or should the apps also be voice-activated? Should there be an annual licensing fee? Should they allow co-branding with affiliations (e.g., a professional sports team or one’s college alma mater)? Which features should be recommended as the unit is designed?
This electronics firm has little experience in marketing research as well, so the older managers were uncertain as to how to proceed. One mentioned a focus group, another suggested an ethnography, and a third mentioned surveys. The information that is sought, as well as the method by which the information would be obtained, are both to be determined. Naturally, the company wants to roll out the new wearable as soon as possible, so while the research project could be well funded, the team would face time pressure and would have to be judicious in their choice of research avenues.
Case Discussion Questions
A lot of other wearables focus on counting steps or enabling apps. Is that what this group should design, so as to be seen as a legitimate competitor and not confuse customers, or should they design something different to be seen as innovative?
Are all team members on this brand project a good proxy for their customers? Which team members have life or work experiences that might resemble those of the target customers, and are we listening to them (those team members, and those target customers)?
What additional information would be helpful to strengthen a recommendation?
How would that information best be obtained?