Consumers are willing to trade in their privacy for better wearable devices

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Google Glasses

Privacy is not a major factor in influencing consumers when buying wearable devices compared to other factors such as price

Wearable devices are clothing and accessories such as Google Glasses that incorporate technologies and that are worn to track and improve factors such as fitness, health and lifestyle. The global number of wearable smart devices is expected to grow to 64 million by 2017. As these devices collect information about a user’s identity, their activities and their lives, concerns have been raised about security and privacy.

Students from Imperial College Business School and the branding firm Zeno Group have surveyed 130 people primarily in the UK who purchased wearable devices. The aim of the study was to understand the value that users place on their privacy, and the extent to which they are willing to surrender private information in exchange for better wearable devices. 

The team found that users were drawn to the lifestyle benefits of wearable devices, with 72 per cent of people not taking privacy issues into account when purchasing a wearable device.  For example, consumers are willing to share their location and heart rate data with a wearable fitness product such as Garmin in return for insights into their fitness.

According to the report, 59 per cent of consumers were unaware that information collected by wearable devices is shared with third parties.  Even when survey respondents were given the option of knowingly given up their personal details knowing that could be shared

The team says that companies should place more emphasis on educating consumers on the process of collecting and sharing information. 

The team also found that the more expensive the device, the more people are willing to share their personal data.  The students suggest that people are willing to share personal information because they do not want to miss out on the perceived benefits that a high-end device, such as Nike’s activity monitor FuelBand, may bring. This is because high-end devices tend to have more functionality that can give consumers greater insights.

Rashee Pandey, co-author of the report from Imperial College Business School, said: “Wearable technology is a growing phenomenon with people wanting to gain insights into their health, fitness and lifestyle.  However, there have been some concerns that consumers may be uncomfortable about how their personal data is being collected and shared.  Our report suggests that privacy does not play a major role in a consumers’ decision to buy a wearable device compared to other factors such as price, functionality or design.  Our report provides insights for manufacturers into the role that privacy plays over utility when developing their products, and recommends transparency if companies are sharing consumer information with third parties.”

The students also found that consumers are more willing to share their personal data when they are offered rewards such as entering competitions for prizes because they believe they will get something of value.

The team used data collected from surveys and interviews from across the UK and countries around the world such as US, Germany and Thailand.   

The students carried out the project as part of the MSc Strategic Marketing programme

Download a copy of the report (pdf)

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Maxine Myers

Maxine Myers
Communications Division

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Contact details

Tel: +44 (0)7561 451 724
Email: maxine.myers@imperial.ac.uk

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