Nike’s timely exit from wearables

fuel band

Nike have exited the wearables market at the perfect time. In launching the Fuel Band, they helped establish a category and set consumer expectations for fitness wearables hardware and software experiences. Oh and they learnt along the way how to plug it in most efficiently into stickiest part of the Nike ecosystem, the data.

“Just last week, Nike announced the launch of its San Francisco-based Fuel Lab. The testing space, born from its accelerator program, will join Nike’s slew of other innovation-branded R&D havens where companies will be able to design hardware products that incorporate the company’s proprietary point-based workout metric, NikeFuel.

Essentially, it will be a incubator for FuelBand successors, as long as they plug in to Nike+, for which Nike is publicly releasing an API this fall.”

Their focus on APIs through public developer programs and exclusive incubators will foster the right level of ecosystem innovation at the hardware level and have it accrue to their core competency – their sports products. Now that manufacturing and prototyping costs have reached a startup friendly level (hello 3D printing), gone is the need to have bucket loads of cash to get a product off the ground. Nike is sensibly dispersing that risk to the ecosystem and focusing on its core products. Bravo.

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