Why Amazon’s Halo Connects With Your Health Needs
There’s a problem with traditional fitness and nutrition books and resources. They provide generic advice like stating that everybody should run three miles a day or lift heavyweights. These tips do not account for the fact everybody has different health histories. If you have had severe knee injuries, running every day doesn’t make sense. Amazon Halo takes a different approach by using health challenges.
With more than 100 health and fitness challenges, the service makes it easy to choose one area of life to improve. For example, you can take a challenge to reduce your daily caffeine intake. As you go through the challenge, the app tracks your situation. That means you receive personalized recommendations. If your body is less sensitive to caffeine, you might find out that you can manage two cups of coffee per day. Another person may find that this level of consumption will keep them up past midnight.
By guiding users through small changes, Amazon Halo and Lifesum make it easier to change health habits. If you have read habit books like “Atomic Habits” by James Clear and couldn’t make progress, this app might be what you need.
What This App Tells Us About Amazon’s Evolution
As one of the world’s largest companies, Amazon’s moves are worth studying closely. First, this product development stands out as a partnership. Historically, Amazon has not pursued this type of partnership at a product level. The partnership with Lifesum may indicate that Amazon is open to partnerships with smaller wins to enter new markets.
Speaking of new markets, the Amazon Halo signals a potential strategic shift for Amazon. For years, the company has focused its strategy on offering low prices. Later, the company gained ground by offering next-day and same-day shipping service. This move to the health and wellness industry is something different. Perhaps we should have expected a more significant move toward wellness after Amazon spent more than $14 billion to acquire Whole Foods a few years ago.
Amazon’s Ongoing Evolution to Become the Ultimate Data Company
When consumers think about companies that know them well, Google and Facebook typically come to mind. Indeed, those firms have built robust advertising platforms based on their users. However, Amazon has a data asset that is even more valuable – millions and millions of purchases! The company has already used that data to build one of the world’s most potent product recommendations engines.
As the company expands into health, habits, and wellness, there are interesting implications to this move. Amazon may take market share from other health technology companies like Fitbit.
The State of the Health App Industry: Lessons From FitBit, Peloton, and Other Growing Companies
While the world’s gyms, personal trainers, and fitness facilities have endured significant disruptions in 2020, health apps are going strong. Grandview Research estimates that the health apps market is worth over $12 billion as of 2018. Amazon faces significant competition from well-established health and wellness apps as well.
According to App Annie, the top gross health and wellness apps in the United States span a few categories. There are meditation apps like Calm (#3 grossing) and Headspace (#7 grossing). Besides, there are fitness apps such as SWEAT, AllTrails, and Peloton. Finally, there are health apps focused on weight loss, such as WW (formerly Weight Watchers) and Lose It!
Take Peloton as an example. Best known for its on-demand cycling classes, Peloton achieved over $700 million in revenue in 2019, including both hardware and software. The company has an estimated 1.4 million users today, a small fraction of its potential market size. Active.com reports that approximately 45 million Americans use bicycles for transportation. These figures suggest that Peloton still has significant growth potential even if it continues to focus on its core user base of cyclists.
In contrast to Peloton, consider Fitbit, which offers a different service. When Google bought the company in 2019 for $2 billion, FitBit had approximately 28 million active users worldwide and had sold over 100 million devices. From an app perspective, users can choose between using a free or paid use of the app. The app makes it easy to track health and fitness activities, like walking and sleeping.
Two Advantages That Make Amazon and Lifesum’s Partnership Notable
While Amazon is up against some serious competition, there is reason to believe that it will succeed. First, consider Amazon’s robust strength in gathering and using customer data. If the company can help people improve their fitness habits quickly, it might overtake established companies like WW, which had 4.2 million active subscribers at the end of 2019.
Aside from data, Amazon also has expertise in hardware. The company has produced the Kindle device for over a decade. While fitness hardware is different from electronic book readers, Amazon could build on its existing hardware strengths. For example, could Amazon use its scale to deliver a budget-friendly bicycle to lure customers away from Peloton? It is a plausible outcome that may come in the future.
The Elephant in the Room for Health Apps: Making Home Fitness Easy and Attractive
As a result of the pandemic, there has been an explosion of interest in at-home fitness activities. For example, CNN reports that MIRROR, which offers an at-home fitness system, has doubled its sales in 2020 due to COVID-19. Online health class provider Obé has also grown significantly in 2020. As a result of gym closures and restrictions, we are likely to see continued high demand for health apps that foster a healthy lifestyle at home.
About the Author
Bruce Harpham is an author and marketing consultant based in Canada. His first book "Project Managers At Work" shared real-world success lessons from NASA, Google, and other organizations. His articles have been published in CIO.com, InfoWorld, Canadian Business, and other organizations. Visit BruceHarpham.com for articles, interviews with tech leaders, and updates on future books.