Apple Inc. (NASDAQ: AAPL) is reportedly working on launching a bundled fitness-oriented service by October for the higher end, to push its services business into the fitness and digital health industry. Apple’s fitness app is set to move into the digital-only subscription fitness space dominated by Peloton and Nike, that provides access to a library of virtual fitness classes at a monthly price that is lower than your typical gym membership.
And while the details remain unclear, Apple’s fitness app sounds very much similar to Peloton (NASDAQ:PTON) offerings: a digital-only subscription offer that provides access to a content library of virtual fitness classes.
The question is: Will Apple be giving Peloton a run for its money?
Following the report of possible competition from Apple, shares of Peloton, the trendy at-home fitness service that streams classes to a spin bike or treadmill, fell more than 4% in premarket trading — but then quickly recovered — and closed at $65.65, up 2%. Though Wall Street analysts remain confident that the exercise-bike company can maintain its lead in the virtual fitness space.
During the coronavirus pandemic, there has been an upsurge in interest for at-home fitness classes due to gym closures and a preference to reduce contact between individuals. During the pandemic period, guided workout app downloaded grew 220% year-on-year globally.
In broad strokes, the plan echoes products from Peloton and Nike, which offer streaming classes at a monthly price that is lower than your typical gym membership — a trend that has recently gained popularity as people have been flocking to at-home fitness classes during the coronavirus pandemic that has forced temporary gym closures across the globe. As a result, Peloton shares have been up more than 120% this year thanks to a surge in sales for its bikes and treadmills, even garnering diehard fans that some would consider ‘cultish’.
Apple’s new fitness app will be available on the company’s devices, like the iPhone, iPad and Apple TV, while Peloton’s offerings are tied to hardware devices such as bikes and treadmills. As compared to Apple, Peloton already offers thousands of on-demand classes in addition to live-streamed ones. Whilst the former has lots of groundwork to be done, given how its recent new video streaming platform does not have a particularly robust content catalogue. It is also unclear how much Apple’s fitness subscription service would cost. Though it might make sense to bundle it with the Apple Watch.
In Q3 2019, Peloton’s digital-only subscription revenue represented only 1% of total revenue, which means that the biggest value in digital subscribers for the company is their potential conversion to connected fitness subscribers.
“We think Apple’s new fitness app could compete vs. Peloton’s digital only subscription offer, but will have limited impact on Peloton’s connected fitness base that uses Peloton’s bike or a tread,” Bank of America Securities Analyst, Justin Post wrote. “Longer-term, it is unclear whether Apple would partner with other at-home fitness hardware companies, or create its own proprietary bike/tread, though we think former is more likely than the latter.”
One potential partnership could be ReflectFitness Asia, a one-stop portal filled with digital classes on demand or live-streamed, and supported with resources related to fitness, health, and exercise. Launching in October, ReflectFitness builds upon its community roots and creates a digital ecosystem that revolutionises the way people exercise and consume fitness related information. ReflectFitness aims to make exercising in the comfort of home, at the user’s own time, simple and convenient. Operating with paired accessories such as heart rate monitors to track output and progress after each workout, world-class Reflect instructors will provide live and on-demand one-on-one style workouts including Strength, Cardio, Yoga, Pilates, Barre, Kickboxing, and Zumba, all within the ReflectFitness ecosystem. The portal also allows users to compete with friends through community challenges and leader boards, creating an exciting platform to engage friends and family on the user’s fitness journey.
At first thought, fashion and gaming may seem like an unlikely duo. But if the fashion industry were to ensure it continues to be accessible and relevant in every way possible, it would seem almost ignorant to cash in on the gaming trend as esports becomes more mainstream.
The COVID-19 lockdown has led to an acceleration of various trends. And perhaps this is why the convergence of both industries may not come as a surprise, as more and more major fashion houses and fast-fashion giants want in on a piece of that gaming pie. Besides, with thousands of gamers in the virtual world, what better place than that to reach out to potential customers. If you can’t flaunt it in real life, you do so online by dressing your avatar in new skins, clothing, and accessories from various brands. What’s more, these fashion brands would also be able to reach out to a much younger audience, a group that is relatively harder to get to.
But before we get into the subject itself, let’s have a look at the numbers. According to research firm Newzoo, the online gaming industry generated approximately US$138.7 billion in sales last year, and is most likely to rake in US$159.3 billion this year — that’s about a 10% growth! And by next year, this is likely to exceed US$180 billion. Now here’s something more interesting. If you were expecting teen boys to constitute the bulk of mobile game users, you’re sorely mistaken. Because 63 per cent of them are women. That’s right. And according to a marketing report by Liftoff, female gamers are 79 per cent more likely to make an in-app purchase than their male counterparts. A research from Mindshare has also shown that over half of esports fans are millennials, a generation that is reaching their prime spending years. So whether it’s a small in-game purchase or for the whole gaming experience, the esports industry has definitely proven to be a viable avenue for fashion brands to get to potential customers, and convert them into loyal clients.
In all honesty, you would probably have seen this coming. Some 20 years ago, fashion brands were already making their foray into the gaming industry, and exploring this territory by venturing into games like ‘The Sims’. Or just like how Moschino and Diesel opened virtual boutiques in ‘Second life’ in the early 2000s.
Louis Vuitton recently entered a partnership with US-based developer Riot Games, the business behind the famous ‘League of Legends’ online championship which saw 100 million global e-spectators watch its finale last November. All it took for the French fashion house to ensure maximum visibility was for its Creative Director, Nicolas Ghesquière, to design an outfit for one of the characters in the game during the finale.
And most recently, on March 20 in the midst of the coronavirus pandemic, Japan’s Nintendo launched ‘Animal Crossing: New Horizons’, a social simulation game that invites its players to control digital avatars live on paradise islands and indulge in various sorts of peaceful activities including gardening, DIY, fishing, and even having picnics with neighbours. In just a span of a few weeks, it sold over 10 million units and became the star game of the lockdown.
With increased possibilities for customisation and dressing up your avatar, it certainly didn’t take much to lure fashion brands to Animal Crossing. It’s in-game ‘Pro Designs’ function allows users to make their own outfits by reproducing the trendiest pieces from brands like Prada, Gucci, Chanel, Dior, and even streetwear labels like Stüssy and Supreme.
This surge in creativity spilled over to social media, with players creating dedicated profiles just to share their outfits. One such example that capitalised on this want for fashion-savvy avatars is Nook Street Market, recreating looks from luxury labels like Chanel, Off-White, Vivienne Westwood, and Fendi. This buzz prompted brands including Valentino, Marc Jacobs, and many others to offer their own designs to Animal Crossing players — offering them the ability to access virtual clothing and accessories for free via special codes which can be obtained from Instagram stories.
And it doesn’t really matter that the in-game outfits are simplified, and without details. Perhaps what’s fascinating is how these luxury labels are still able to command desirability even in the virtual world, making the gaming industry a viable way for brands to reach out to a new clientele, and even strengthen relationships with their pre-existing fans.
In recent years, designer labels like Burberry and Gucci have even created their own games. Similarly, Italy’s LUISAVIAROMA has also just launched the ‘Mod4’ application, which gamifies the shopping experience. ‘Client players’ are invited to create their own avatar, browse items offered by the store, and take part in contests with other players.
Perhaps this is part of the new normal, an increasingly virtual world that has forced fashion to switch from e-commerce, digital showrooms, and even online fashion weeks, to the gaming industry, a new territory with immense potential for its businesses to diversify.
Japan’s longest serving prime minister, Shinzo Abe, announced his departure from office last Friday, citing his health as the main problem. His abrupt resignation sent shock waves throughout the world, especially Japan as they ponder about the great strides Japan has taken since Abe’s presidency. Throughout the 8 years in power, this premier has rendered a paradigm shift in the Japanese society through its economic, political and social reforms.
Commentators have noted that his loss of popularity as a prime minister in recent months was also the prime reason he is deciding to leave after serving Japan for many years. Despite having steady support from its citizens for seven years, Abe saw a steady decrease in support for his cabinet in 2020.
When the pandemic swept in, Abe was criticised for the way he handled the whole situation.
Who is Shinzo Abe?
Abe, 65 was initially elected to Parliament in 1993 after the death of his father, who was a foreign minister. However, he only started serving as a prime minister in 2006, but stepped down the following year after a scandal broke out.
In 2012, Abe became the country’s leader once again where he made key promises such as fixing the besieged Japanese economy and also amending Japan’s pacifist constitution, which will allow for a full-fledged military.
Abe first exited the office in 2007, after nearly serving for eight years due to his ailing health — a relapse of a bowel disease.
Throughout his time at office, Abe’s presence has definitely left an indelible mark on Japan’s defence policies and economy. Not only that, he also managed to maintain high profile relationships with foreign allies from all over the world.
However, Abe has said that he will continue to serve as a prime minster until his successor is chosen.
Here is a walk-through of Shinzo Abe’s prominent legacy.
Since coming into power for the second time, Abe has changed its international affairs approach. The highly contested Yasukuni Shrine which was dedicated towards war casualties ruffled the feathers of regional countries like China and South Korea. Although Abe visited the shrine in 2013, which created much public outcry, he has thoroughly refrained from visiting the shrine, knowing all too well that it will sour the relationship with South Korea — a huge departure from his predecessors. Similarly, Abe has radically changed the interpretation of Article 9 constitution, which originally renounced the right to go to war. Instead, the reinterpretation of Article 9 allowed Japanese forces to fight alongside overseas allies, drawing condemnation from China and South Korea while simultaneously receives blessings from U.S. This move has allowed U.S. to continue developing good relationships with Japan.
While regional countries like China continue to drive a wedge with the hegemon U.S., Japan under Abe has made great investments in forging closer relationship with President Donald Trump to benefit from economic investments such as trade. For example, Abe has hosted President Donald trump in high-profile summits in Japan. Their intimate relationship, as seen in their close interactions through 32 phone calls and 5 rounds of golf, has allowed Abe to pursue Japan’s interests such as keeping the Trans-Pacific Partnership alive even after America’s withdrawal.
Aside from international or political affairs, Abe has also managed to move Japan’s society towards an inclusive and diverse one with an open market that embraces migration into Japan. He has reformed unproductive corporate culture by creating a new form of corporate governance code and investor stewardship code that aims to increase shareholder control and profitability. Meanwhile, the power of the traditionalist managers weakens. Additionally, Abe has also sought to punish the toxic corporate culture where workers had to endure unproductive overtime hours. Of particular importance, while his party had long resisted Japan’s movement towards gender equality and immigration, Abe has nudged companies to hire more women and minimise gender inequality through the provision of funded daycare centers, encouraging more men to take paternity leave as well as provide companies incentives if they hire women.
Abe will leave behind his biggest legacy, Abenomics, which was aimed to curb the threats of deflation and an aging work force through fiscal spending, corporate deregulation, and cheap cash.
Abenomics delivered great results in the early years of Abe’s term which lifted Japan’s economy immensely and at the same time, lifting Abe’s profile as a prime minister. However, in 2019, the steady growth suffered due to the trade war between United States and China. It then took a further downfall when the pandemic hit Japan, causing its economy to hit a slump.
Who will take over Abe?
Certainly, Abe has done pretty well in his political and public policy approach during his 8-year long term. However, Abe has not groomed a successor during this time, and this creates anxiety for Japan; some scholars have argued that with Abe stepping down, Abe’s rival, Shigeru Ishiba who is the most popular politician will take over. What lays ahead for Japan and its society? It would be tough for the next prime minister to match Abe’s legacy on economic, political, and social policies where he brought the country out of recession and diversified Japan’s labour force.
Ishiba will have a tough challenge ahead as it tries to win the support of its party members as well as Abe’s party who regards him as a political foe. With this tussle ahead of him, one wonders his plans for the future and if he is able to charismatically deliver policies despite the constant tension within the cabinet.