Too much data
How useful is Under Armour’s data collection to my personal health?
“Changing the way athletes dress to changing the way athletes live” – Kevin Plank, Under Armour CEO
How much data is too much data? Under Armour’s Connected Fitness endeavor believes that consumers want a device that tracks every aspect of personal health, which means there is no such thing as too much data. From sleep cycles to nutrition to heart rate, Under Armour is attempting to create a phone app that will give you more give you more current and multi-dimensional personalized medical information than your doctor currently has while also being your personal athletic training coach. Is all of this data collection useful enough for the casual athlete to justify Under Armour’s $700m investment in Connected Fitness? 1 Constant data collection may be helpful for professional athletes like Michael Phelps, Stephen Curry, Lindsey Vonn, or Dwayne “The Rock” Johnson, but Connected Fitness seems more like an overuse of technology when sold to the mainstream consumer. Under Armour’s exploration of emerging online fitness communities and investments in technology discoveries are important because there is an undeniable consumer trend towards digital products, but the company and its consumers are still learning how to best apply and use these new devices.
Digital transformation has created a new business opportunity for Under Armour and the company’s business model has adapted by offering new products. As Under Armour CFO Brad Dickerson said, “Connected Fitness is a completely different kind of technical space than our core business. We’re investing way ahead of the curve.”1 The company that was previously known for sweat-wicking apparel is attempting to grow into a personal health company. The business model for this endeavor is to sell new connected devices (UA Band, etc) and provide apps (offered through free trials and supported by advertisements and freemium models) that collect data so that the company’s Connected Fitness platform can provide actionable insight to its consumers (athletes), such as how much food they need to eat, how hard they need to workout, and how many hours they need to sleep.
Under Armour quickly realized that it did not have the operational capabilities to enter the new world of sensory feedback, GPS tracking, and social networks so the company created a new operating model, starting with acquiring MapMyFitness in 2013, followed by two other fitness community Apps, EndoMondo and MyFitnessPal. Under Armour’s workforce also shifted significantly. In 2013 Under Armour had fewer than 12 engineers in a company of 8,000 people, but through acquisitions and internal new hires, the company’s Connected Fitness team now has roughly 100 dedicated engineers and a Digital Team of more than 500 employees.
Digital Health and Connected Fitness Communities are two new concepts, made possible by new technology breakthroughs. While I am pessimistic about the current usefulness of wearable technology for the average consumer or casual athlete beyond a fun holiday present, I am excited for Under Armour to refine its products and marketing message over the coming years. As we have seen in Li & Fung and UberPOOL, new technology allows companies to expand their product offerings, but just because something is possible does not mean it is a good business idea. UnderArmour needs to educate consumers about why Digital Health tools are important enough to pay $300 for a UA HealthBox (includes UA Band, UA Scale, and UA heart rate monitor torso band) or to record your food intake at every snack and meal. Currently, the products seem in a trial phase and only useful for professional athletes or fitness fanatics.
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Source:
1- Connected Fitness Presentation, Under Armour Analyst Meeting (2/10/2015), http://investor.underarmour.com/events.cfm?Year=2015
https://youtu.be/IOkzta6p8ME, Kevin Plank speech at National Retail Federation’s “Retail’s BIG Show 2016” (1/19/2016)
http://video.underarmour.com/?v=1419482385
https://www.underarmour.com/en-us/pid1292219?iid=banner
Like you said, many fitness companies are attempting to create a platform that allows people to track many different health aspects of a persons life. I too feel like this is more than what the average person needs, however if a company was able to tie this information to medical practices and use it as a diagnostic tool to detect a problem with a patient, this digitization could potentially provide alot of value. If this technology that Under Armour has developed could be tied with an insurance company and potentially lower the rates of a consumer because they are showing proof that they are living an active and healthy lifestyle, then this technology could be a win-win for all partners involved.
Coach, great post. As a Baltimore native, I am always interested in UA’s latest strategy. While I understand your skepticism with respect to their endeavor into the digital, wearable space, I think they have the means to be effective in personal health using these products. By tracking sleep, blood pressure, oxygen levels, etc. UA could understand health patterns that lead to stroke or heart attack. It might make sense to start with extreme cases like athletes, but their data systems could lead to more useful health info longer term. One company focused on this is called Whoop (http://whoop.com/). Their software focuses on identifying health trends so that they can predict problems before they arise.
Great post, Coach! I have been following Under Armour’s foray into Connected Health and it seems like they are shooting a lot of arrows in the dark. You’e pointed out important questions that push companies like Under Armour to not use ‘collecting and assessing data’ as a marketing gimmick but actually create a reasonable value proposition for consumers through this data. My two questions are, if they want to bring access to data that improves health of athletes, can they do it at a low cost (thinking of the combination of 5-10 sensors they would need per device to track data)? Can they create actionable steps, processes or services that enhance the value of this data collection (eg: offer a liquid that restores vitamins and minerals based on the hydration data?), meaning can they close the feedback loop of this data?
Maybe next time I wear my Under Armour tee shirt, I will know how much water I need to drink?
Love the post, coach! I agree with you on your assessment of this move on the part of Under Armour – to steal concepts from marketing, it seems like the value-in-use to the average consumer is far lower than the price Under Armour has asked for their product. It also seems like a fundamental shift in their brand and target segment – from gritty athlete to health nut. Sometimes these consumers are one and the same, but only for a small segment of the population.
To be frank, I still harbor some skepticism of how much value the current wearable technology market provides to our society. CNN recently released an article which noted that while people wearing a Fitbit did choose to exercise more, they also find it a challenge to live without the Fitbit. They feel frustrated that activity is “wasted” and their intrinsic motivation to exercise will fall, as they have become dependent on the Fitbit for motivation. (http://www.cnn.com/2016/09/01/health/dark-side-of-fitness-trackers/). While I appreciate the great intentions of many of these technologies, I do wonder sometimes if their secondary effects reduce their value overall and if so, what does that mean for the market and society?
Great post – while I agree with your skepticism about how much value Under Armour will be able to capture from consumers with these new products (Nike has tried to get into this space from many different angles without much success), I wonder how else they might be able to leverage the data. For example, capturing data on consumers run patterns should help inform product design and ultimately give UA unique insight into which products are most relevant to each consumer. Further, moving forward is there a way to integrate this data (e.g., exercise, sleep) with medical providers to better inform their decisions?
Super cool post. Seems like the next-gen Iron Man type base layers will be available in the near future. I wonder how different producing and marketing “smart” athletic wear is from the processes for traditional Under Amour apparel. Digital active wear will need to withstand intense conditions next to the athlete’s skin. Sweat, heat, and chafing will be big concerns not to mention machine washing. Not only will the products need to be expertly designed and durable, but at a reasonable price point such that they are accessible by the mass market. Decreasing prices will require innovations in the manufacturing pipeline – smart athletic clothing cannot be priced at iPhone levels, but will have to perform with iPhone-like technologies. Like Nike vs. Adidas during the World Cup, Under Armour will need to establish its target market and be highly specific when generating buzz around its new products.
I agree with a lot of your thoughts – it seems often that some of these devices track data that we can’t actually turn into actionable insights at the average consumer level, leading to them being more a novelty than truly useful. I do think these sensors will see much more success in the preventative medicine space – and it becomes particularly interesting when picturing the long-term possibilities. As some other posts have mentioned, wearable devices could monitor and different metrics in real time and alarm users of risk indicators. This could be not only for acute problems such as heart attacks but also more subtle signs for health conditions, such as monitoring gait or voice as indicators of potential neurological conditions. And if tracking became more ubiquitous its power would continually increase over time – with more data available to process combined with artificial intelligence, we could possibly detect issues much sooner than we do today. One can imagine a scenario where the first line of care are data monitoring centers that receive a report of a flag and can suggest an immediate course of action, with the potential to greatly enhance the efficiency of treatment.