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EBay tests smart watch commerce, but is it right for other retailers?

September 6, 2013

EBay launches smart watch app

Samsung’s unveil of the much-anticipated Samsung Galaxy Gear smart watch highlights how marketers such as eBay are moving beyond smartphones and tablets for mobile commerce. However, retailers will have an uphill battle with smart watches since the devices are positioned around simple, utility-driven tasks.

Samsung showcased 12 featured applications at its launch this week, with eBay as the only commerce-enabled one, pointing to the opportunities that retailers have to rethink the shopping experience through a device that is on 24/7 and strapped to a consumer’s wrist. However, given how new and small the devices are, there are significant obstacles for marketers.

“Unlike a phone that’s tucked into a purse or pocket, a wearable device is conveniently located and always out,” said Steve Yankovich, vice president of innovation and new ventures at eBay, San Jose, CA.

“It’s important for us to maximize both the delight of our customers and how often they engage with our products,” he said.

Wrist shopping
Samsung’s Galaxy Gear smart watch syncs up with the manufacturer’s new Galaxy Note III and lets consumers receive notifications, share photos and access applications.

The watch will reportedly cost $299 and will go on sale alongside the Galaxy Note III on Sept. 25. In a move to make the smart watch appeal to consumers as an accessory, the watch will be available in six colors.

The majority of interest around smart watches up until now has been around utility-based apps and services as opposed to shopping, which makes eBay’s app particularly interesting.

EBay’s app will let consumers bid on items via their watches, and users will also be able to see if they have won an item or have sold an item. Information on counter bids, best offers and messages will also be available via the app.

A screenshot of the eBay Samsung Galaxy Gear app

Smart watch owners can use eBay’s Android app as a companion to the experience, which gives consumers a more comprehensive look at all of their notifications and settings.

According to eBay, the decision to roll out an initial app for Samsung’s Galaxy Gear watch is part of the company’s ongoing goal to experiment with every connected device that consumers access to create a seamless shopping experience.

Mobile app Vivino is another one of the companies that is launching a Samsung Galaxy Gear watch. The company’s smartphone app uses image recognition to match up photos of wine bottles with a database of 1.6 million wines.

Vinino’s smart watch app will make the photo-shooting process more discrete by letting consumers take pictures from their wrist.

When Samsung’s Galaxy Gear watch launches later this year, the company claims that more than 70 apps will be available.

Small devices, big challenges
Retailers are increasingly thinking with bigger devices in mind these days, as evidenced by the focus on phablets and tablets that mimic a shopping experience more compatible with desktops than smartphones.

As marketers continue to cram more features into smartphones and tablets, a smart watch that only does a few things well could be well-received by consumers, according to Wilson Kerr, vice president of business development and sales at Unbound Commerce, Boston.

“In recent years, so many bells and whistles have been packed into smartphones that a simplified smart watch interface with an easy ‘buy now’ ecommerce feature could play well with consumers,” Mr. Kerr said.

For a retailer, translating an online experience to a real-world experience is particularly difficult through a smart watch.

Therefore, smart watches could give a big boost to technologies such as near-field communication that have been sluggish to take off.

For example, retailers could leverage NFC within a smart watch to trigger a commerce experience via a smartphone app.

In eBay’s case, the company’s Red Laser product could be used in driving online sales via bar code scanning.

“If this was combined with time-sensitive or personalized offers, this could be very appealing,” Mr. Kerr said.

“Amazon has proven that one-click checkout is a goldmine, if done right, so it’s not hard to imagine smart watches playing a role in bringing this into the retail environment,” he said.

Samsung’s new smart watch

Lost in translation?
Compared to smartphones and tablets, smart watch apps will need to tap into more native experiences such as voice recognition since there is obviously much less real estate.

“The watches themselves will play a big role, but I don’t think they become valuable for ecommerce until voice-activated command enters a more reliable form reality,” said Steve Rowen, Boston-based managing partner at RSRResearch. “And right now, that still seems a bit of a ways off.”

Additionally, consumers will have to be far more decisive about which apps they chose to download onto a smart watch since there is less storage, which again is particularly challenging for retailers when consumers might only use an app a few times per month to shop.

Smart watch apps risk falling into the exact same trap as mobile apps if there are too many options available to consumers, especially since the devices are marketed for their simplicity.

“Personally, in order for a smart watch to work, for me at least, the first thing I’m going to want it to be is beyond intuitive,” Mr. Rowen said.

“It’s a very small format, and I don’t want to have to tinker with it much for that very reason,” he said.

“In order for the watch to work well from a fashionable point of view, the screen is going to be about one inch-by-one inch – that’s just not enough room for much swiping and manipulation, so things like the ability to take a call, get the weather, use a heart rate monitor – the more basic the better.”

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York

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