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Waiting for the Smartwatch to get Smarter

For those of us frustrated by the unrealized potential of wearable technologies, a raft of announcements this summer really don’t help. And for banking in particular, it’s like the needle hasn’t moved at all.

Take Apple, long considered the dominant force in technology innovation and subsequent customer adoption. This is the company that really decides what’s new and what’s next—it makes and sells, we buy, right? So, when this doyenne of tech cool recently came out with the Apple Watch Series 2 a few weeks ago, what did we get? A fitness tracker.

What’s almost worse is that this is actually progress; it took a long time for Apple to even say ‘wearable,’ since it preferred the term smartwatch. And there’s surely a case to be made for letting the product find its niche, giving consumers a chance to play with the device and figure out how they want to use it. Meanwhile, even before the new release, Apple is already behind only Rolex in watch sales, having vaulted past such renowned brands as Omega, Cartier, Citizen and Patek Philippe. And it turns out that all those new users just wanted a device that could be used to enable a healthy lifestyle.

Fine, but Apple’s great strength has always been to lead the market, not follow it. It doesn’t meet needs as much as create capabilities that we become hooked on. That’s why there was optimism that the new release would point toward different kinds of functionality—like, say, personal finance. Instead we get GPS and better water resistance.

To be sure, Apple is not alone in this regard. Just a few days earlier, leading rival Samsung hit the market with its own Gear S3. There are no less than three models in the line, and they offer a sharp contrast with the seemingly less versatile Apple Watch. So what’s the standout feature in the new collection? In a word, toughness. All three models are ‘outdoors-friendly,’ and reviewers who have run a battery of tests are quite impressed.

Where the watches of old were handed down through the generations as family heirlooms, the new releases promise to withstand abuse, and become obsolete after a year and half.

Of course, there’s nothing wrong with these devices offering health-related capabilities. Where options from Fitbit, Polar and others in this space are singularly focused on fitness, the smartwatch has the capacity to blend these characteristics with broader lifestyle priorities and needs. The smartwatch is a ‘wearable’ computer that’s actually worn, so the fact that it monitors physical characteristics makes perfect sense. In fact, it’s an obvious choice for software development.

But that’s also the problem. Most mobile capabilities that seem obvious to us now were not on anyone’s radar before they emerged and got adopted. (For example, if you live in an apartment building with a laundry in the basement, imagine being able to look up which machines will be free in how long. We never thought of it before we got it, but then it seemed like a major step forward for civilization.) By contrast, the fact that smartwatches are still focused on the obvious is a sign that we haven’t moved forward nearly enough.

On this blog we’ve often speculated about where the wearable market might be headed. For example, insurance companies could require the attachment of wearables to the human body as a condition for lower premiums. (This might be a financial services extension no one wants.) We’ve wondered if a combination of GPS and financial history could be used to encourage sales, such as by sending out loan offers when the individual has walked into an auto dealership or an open house. We’ve considered how a new breed of apps would be customized specifically for that tiny bit of real estate on the wrist. For example, imagine a smartwatch app that monitors the heart rate, blood pressure and BMI, connects it to other dietary restrictions, scans for sales at the grocery store, and serves up appropriate recommendations, or even purchases and home delivery with a ‘yes’ muttered to the wrist. Wouldn’t that be cool?

But so far, that’s all it’s been—speculation. We’ve seen how fast the market embraced online banking, and how quickly mobile banking apps got adopted. We’re very aware of how college-age consumers have no memory of a time before digital capabilities, and that they blithely switch to the next available platform. The smartwatch may be just that platform, but we won’t know until we get past the ‘obvious’ capabilities.

It’s time to go above and beyond mobile and online banking, and find the next new thing. If we don’t, the market will find it first, and we’ll be playing catch-up. . .again.

Written by Jack Dougal