It’s All in The Wrist Action … Apple Pay and The Apple Watch

apple_pay_watch-580x387I was excited by the thought of Apple Pay on my Watch. There’s a (childish) appeal that I can pay for stuff just using the device on my wrist. And it looks as if I’m not the only one. In June, mobile analyst,  Benedict Evans (@benedictevans) Tweeted: ‘Apple Pay with a phone is still just taking something out of your pocket. Not transformative. With a watch it’s amazing. End of friction’. A report released in August from Writstly found that 80% of Watch users have paid with the system and 78% do so at least once a week. With such a high uptake, does that make Apple Pay a rip-roaring success? The answer is, probably not.

I am one of the 80% who have used Apple Pay on the Watch and it has been far from life changing. It is good enough, but far from the great experience that Apple has delivered elsewhere. Double clicking to ‘prime’ the card is fairly easy, although it’s effectively a two-handed operation. Tapping in to pay can be tricky at times. The biggest challenge is getting the angle right on the reader. They are generally set up on the right hand side and this is especially a problem on London’s transport network. If you wear your watch on your left then tapping in can be somewhat hit and miss. That’s not great on TfL where a nanosecond’s pause will cause havoc and loud tutting from other commuters. Another challenge is the availability in retailers. My UK experience is that very few outlets advertise Apple Pay. So for many shops it’s a case of tapping to see if it works. So even on the Watch there is still some friction.

In spite of the Wristly study, its difficult to know the true uptake of the payment system – we don’t know how many Apple Watches have been sold and there have only been a couple of broader studies in the US. One survey from InfoScout covering all Apple devices pointed towards a drop in payment adoption rates – from 15% in March 2015 to 13% in June. The second study was a Gallup Poll, which found that 65% of iPhone 6 users were aware of the payment system, but only 21% had used it. None of these show a comparison in take up with contactless cards, so there’s no baseline to gauge the success.

The Wristly study was a self-selecting sample of Watch users. It’s reasonable to assume that these are early adopters of the device who are likely to try out Apple Pay regardless of the experience. When it comes to a broader audience an experience that’s ‘good enough’ is probably not good enough to drive mass adoption. At the end of the day, Apple Pay is good attempt at mobile payment but it’s hard to see how it will achieve real scale. That said, I’m going to keep using Apple Pay on my Watch. Not because it’s any easier, but just because I can.

Internet of Things Strategy – how businesses are using it already

Trillion fold rise in computing powerThere’s much talk about the Internet of Things (IoT), from wearables to connected devices. We’re seeing lots of shiny new gadgets, but what are the implications for business? Should everyone have a strategy? Without wanting to create a sense of panic, businesses will be surprised by the speed and impact that a rapidly connected world will have.

Moore’s Law, is a good way to understand the growth of tech – it’s not actually a law, but a suggestion that computing power will double every 18 months. In fact, things have developed faster than that and we’ve seen a trillion-fold rise in speed/power since the 1970s. It’s what makes wearables, cloud computing and the Raspberry Pi all possible. It’s not just the growth of computing power either. We’ve also seen the development of new sensors, interactions, big data and AI, along with rapid prototyping tools such as Arduino or 3D printing (often financed by crowd funding). The trouble is, humans aren’t great at understanding the concept of exponential growth, and the academic Larry Downs has pointed out that society, business and governments all develop at different linear rates. In other words, we are responding much slower than the technology is developing.

The concept of the Internet of Things is not simply that devices can connect to the internet, but whole ecosystems that make relevant connections between objects and people (or even cows). Connected homes and cars are obvious examples, but the IoT is also impacting on health, industry (especially with robotics) and agriculture (through sensors). This creates a wealth of data that is increasingly being analysed by intelligent machines.

Why is any of that relevant to businesses and brand marketing in particular? The development of mobile devices is a good parallel. Consumers were ahead of brands in using the devices. They also had an expectation that there would be mobile compatible services. Many businesses were slow to get on board, but are finally getting there. The growth of the IoT means that consumers will also expect businesses, even service-focused brands, to be more efficient and more integrated. That doesn’t mean producing pointless apps or gadgets, but rather, providing a better customer experience by leaveraging the benefits of the IoT. An example of how this integration works is the way that health insurers are using fitness and health monitoring products as part of their customer offering.

There are a few companies have already understood how they can leverage the IoT:

– Nike’s Fuel Band (now discontinued) was an example of a brand utility that took their running up into a technology product

– Nivea used beacon technology to deliver a cheap, paper wrist-based tracker to parents

– Disney has made a $1bn investment in their Magic Band, which makes every element of their parks into a frictionless experience

Then we have an increasing number of businesses where the IoT is core:

– Home control devices such as Nest or Hive are fundamentally IoT companies

Tesla cars are all connected devices. When there was a problem with their software, rather than having an expensive recall, the company was able to make an over the air update and avoid a potential PR disaster

– Withings, the French health tech company only create connected products such as their blood pressure monitor or scales

– Then there’s Uber. They are the world’s biggest cab company but they don’t own a single vehicle. The app is classic IoT by contextually connecting passengers to taxis and their drivers. ‘The Uber for X’ is now the current shorthand for this type of connected business

These examples show how most brands can include the IoT as part of their customer strategy. So what can you do about it? I’ve been looking at IoT strategy for a while now, and come up with a few simple ways in which brands can see how to implement it:

– Connect your existing channels and devices – from Twitter to the excellent IFTTT there are many ways in which to connect your existing activities across a range of devices. There are many good examples – Twitter was how Louis Vuitton connected their ‘Hello Cube’ project, extending it from The Tate Modern to a global audience

Apps as a service layer – it’s not just Uber. Smartphones are the core devices for the IoT. We need to move beyond apps as a goal and instead think, of them as the service tool that makes relevant connections to create ecosystems. Air BnB (who book more rooms than The Hilton Group), Waze, Lyft (transport), Depop (vintage clothing) or Yplan (events) are all superb examples of how to create a connected, frictionless service

Smart watches are not small smartphones – the initial raft of Apple Watch apps have focused on two main areas – notifications and scaled down apps. Notifications make sense, but don’t recognize the full potential. Many brands (I won’t name them) have simply scaled down their iPhone efforts into slightly pointless Watch apps. The solution? It’s about creating the service layer (I mentioned above) that has been successful on smartphones

What’s the real problem? Many brands allow the tech to drive their marketing campaigns (think QR codes, iBeacons or drone deliveries) and with more of it about the challenge is even greater. Many of the current smartwatch apps address a phantom problem – that taking your smartphone out of your pocket is a major challenge in your life. Ditch the technology, think like a user and address a real problem

From health to transport to industry, the IoT has the opportunity to make the world a better place. However, even when the tech is there, the applications won’t keep up. Microsoft’s Bill Buxton talked about The Long Nose of Innovation. He took the (computer) mouse as an example, which went from a wooden block in the 60s, to Xerox Parc in the 70s, the Apple Mac in the 80s and finally to all PCs. When it comes to the IoT  we are at the early stages of that long nose. For brands and marketing, the best thing to do is to experiment, innovate and see what you can do. Just don’t make a pointless Apple Watch app.

The Challenge for The Fashion Brand, Apple

Updated, March 2015

Whilst some are calling the Apple Watch a game changer, many tech observers have missed the point. The Apple Watch is a fashion accessory and it makes Apple a fashion brand. Whilst previous products from the iPod onwards have had a lifestyle element to their branding, the watch puts Apple firmly into the fashion accessory market. The industry bible, Women’s Wear Daily pointed out that Apple’s real competition is not from other tech providers such as Samsung, but the from the mid-range watch manufacturers such as Swatch and Guess. Both of these companies are developing their own products due out within the next 12 months.

Apple understand the importance of being a fashion brand. They have made significant hires from Burberry and Gap, not to mention the addition of leading designer Marc Newson. A number of fashion and watch journalists were invited to the launch event, which further demonstrates the importance of the sector to Apple.

What was the fashion industry’s reaction to the Apple Watch? Generally favourable, but not totally blown away. It’s probably best summed up by Alex Blanter from A.T. Kearney, who specialises in fashion insight:

“Everybody is still trying to figure out how to make a smartwatch a truly must-have device, rather than an interesting and curious novelty,”

An interesting take on the Apple Watch came from HSBC Research who looked at the market for the product in China. They pointed out that luxury watches are bought not to tell the time, but as a status symbol. Is the Apple Watch a sufficient status symbol for that market? They pointed out that the most significant market in this area were as gifts. On that basis, Louis Vuitton or high end sporting goods are competitors as much as watch brands. Perhaps that is Apple’s biggest challenge. Whilst smartphones are (arguably) an essential item, the Apple Watch is not. As an accessory, watches are replaced much less frequently than smartphones. Whilst there is clearly a market amongst the early adopters, does it have what it takes to compete in the higher end accessories market? Understanding the retail challenge, Apple announced that the Watch would be available in selected retailers such as Galeries Lafayette in Paris, and Selfridges luxury hall in London.

One thing that is in Apple’s favour is that they’ve created a product that has watchmaker’s credentials. The Hodinkee watch blog declared the Apple Watch to be a bona fide time-piece, from the overall design, through to the straps, the astronomy face and the rotating crown. The review makes a convincing case for the Apple Watch as a genuine watch. Following the official launch in March 2015, commentators generally agreed that the Watch meets the stylish credentials that consumers are looking for. However, the watchmakers blog pointed out after the launch, Apple will not be in the high end $17,000 Edition, but rather, from shifting a large amount of $500 mid-range watches.

It’s not just the existing watch makers – brands from Motorola to Huwei have also launched equally attractive smart pieces. This is not the first time that Apple has entered an existing market saturated with products. Aside from the brief partnership with Motorola, Apple had never launched a phone before the iPhone.  However, when it comes to smartwatches, in spite of some predictions, as the tech analyst Benedict Evans points out, no one really knows the answer. The ultimate questions is whether Apple brand is sufficient to drive the large scale adoption that the company is hoping for.

And now, Wearables for Pets

Otto: Connected pet collar for dogs and cats The world of wearable computing is not just a human affair. Otto, a UK Startup has developed a connected collar, feeder and cloud services for dogs and cats. Think Nike Fuel for animals (but with knobs on). Otto addresses a real problem, that of the growing obesity in dogs and cats. There are 130 million overweight animals in the US, UK and France alone.

The company has developed an activity tracker that attaches to a collar. It measures the energy used by a dog and cat, which is then mapped against the size and breed to deliver a feeding plan, all controlled by a smarphone app. Additionally, a feeder can be added that automatically dispenses the right amount of food based on the energy used by the pet.

Otto is currently at the prototype stage, and the company has just launched an Indiegogo campaign to raise funds for full production here: http://www.indiegogo.com/projects/otto-petcare-systems/x/5668585