In a brilliant move that combines health incentive, branded value exchange, and wearable tech all together, Nike has been secretly setting up temporary vending machines, aptly named FuelBox, that trade Nike FuelBand points in exchange for branded Nike products. It comes off as a novel guerilla experiment for Nike to market its brand value while generating buzz for its wearable device. Such an integrated plan, if proven successful, would most likely be exerted more frequently.
In somewhat surprising news, Nike has announced that it fired the majority of its FuelBand team, and is pivoting its business away from wearable hardware and into exclusively software. That means that all FuelBands will likely not be produced in the relatively near future, and the slimmer model planned for this fall will not make it to production. For now, though, the present generation of FuelBand will continue to be sold. It seems as though this move isn’t necessarily because the wearable market is faltering; indeed, wearables and fitness tracking more broadly continue to boom. This has more to do with the fact that Nike’s digital app ecosystem continues to out-perform its physical hardware like, and as Apple and Google stand poised to join the battle for consumers’ wrists, Nike likely simply decided now was the time to re-focus the business plan.
Health and fitness innovation is poised for major growth at CES 2013. We’ve seen wearable devices like Nike Fuelband and Fitbit take off and we anticipate more companies will get in the mix at this year’s show. Actually, over 220 to be exact. From measuring glucose levels to REM sleep, the amount of trackable data seems endless and marketers can certainly benefit from reaching health enthusiasts on these platforms.
What Nike’s FuelBand Says About Marketing