BIG DEAL BREWING
Budweiser and Labatt’s owner Anheuser-Busch InBev and SABMiller are in talks to merge and create a beer giant,
Most people who have tried activity trackers get an initial kick out of knowing how many steps they’ve walked, then the novelty wanes and it ends up in a drawer gathering dust.
That might change as more companies decide to incentivize employees to use the devices at work in a bid for a healthier workforce — and hopefully lower their heath-care costs.
On Wednesday, retail giant Target said it is working with Fitbit to offer activity trackers to its 335,000 employees in the U.S. BP Canada already has a similar program in place. Some insurance companies have also offered clients lower premiums if they wear the devices and share their data.
“Almost every large enterprise has some interest in wearable devices and how it might relate to their organization,” said Rick Hu, CEO of Calgary-based Vivametrica, a firm that analyses health data and works with companies to take advantage of it.
“The theory is with a better understanding of the measurement, a company can better direct their resources, understand what potential inputs may have a positive influence, which will then impact productivity and personal healthcare costs.”
Vivametrica made some headlines last year, as the company was involved in the first civil case that used Fitbit data as evidence. The company is also working on a pilot project with Telus, which also invested in Sprout in May, another firm using technology in the wellness management space.
Privacy and data security are two areas of concern with these kinds of programs, said Hu. So far, though, the programs have been voluntary.
As well, the current metric for most of these devices simply count steps, which is not that relevant. Vivametrica has created additional algorithms and statistical models that take other factors into consideration to provide a better picture of a person’s health and use the data to compare to an individual of the same age and gender.
“This way, we’re comparing apples to apples,” said Hu. “We’re now able to provide individuals with a benchmark and give them an idea of what effects their BMI, age and gender will have on the likelihood of them experiencing those particular problems,” such as chronic back pain, diabetes or potentially even depression.
The other issue is that studies have shown that users tend to stop using fitness trackers after a few months, so companies need to come up with contests and competitions, offering rewards to keep employees using them.
Target workers who opt in will be organized into teams for a month-long competition, and the winning team will get to pick a charity to receive a $1-million donation. Fitbit will work with Target to design further programs around the devices, according to Amy McDonough, director of Fitbit Wellness, who also oversees the corporate services business.
While corporate services generate less than 10 per cent of Fitbit’s revenue, it’s “one of the fastest-growing parts of the business,” CEO James Park said in an interview with Bloomberg. The Target deal is one of the company’s largest corporate accounts yet.
The corporate “wellness” market is pro- jected to be worth $11 billion (U.S.) by 2019, Park said on an August conference call with analysts.
McDonough claims one of Fitbit’s customers, Appirio Inc., shaved 6 per cent off its health bill after the first year of using the device. Other corporate customers include Bank of America Corp., Time Warner Inc. and BP PLC.
Corporate products may also help San Francisco-based Fitbit distinguish itself from an increasingly crowded market for wearable devices, where it’s competing with Jawbone Inc., Samsung Electronics Co. and Apple Inc.
For Target, the move is part of the retailer’s effort to improve its image as a “wellness company,” Jodee Kozlak, Target’s chief human resources officer, told Bloomberg. Next year, it plans to start promoting more healthy foods and products to its customers from the moment they enter the store to when they leave at the checkout aisle. It will also give employees a discount on healthy foods with the hope that the effects will trickle down to consumers, Kozlak said. With files from Star wire services