Turn back the clock to January 2012. One of the world’s biggest brands, Nike, was about to embrace one of the world’s biggest trends, wearable sensors. They were making a foray into the new world of digital transformation. The vision was that “information” would be the new “fuel” of the athletic experience, and Nike’s wearable, with software-enabled feedback and experiences, would be dubbed the “Fuel Band”. Imagine the business potential – the most recognized brand in sports going all-in on digital. The leading wearable company of the day, Fitbit, after only three years in existence, had millions of active users and tens of millions of dollars in revenue. If you were a bold executive at Nike in 2012, what would you have done? How would you have deployed your resources to pursue this opportunity? What would your colleagues and advisers have recommended in pursuing this path to hit your Horizon Three growth goals?

Nike leaned in to the opportunity and embraced the quantified-self movement, gamification of exercise, as well as social apps. The Fuel Band was initially so highly sought after it sold out in days, and in the months following re-sold at twice its retail price on eBay. Even though Nike was engaged in all the “right” facets, so too were other companies. But Nike was having problems delivering on the promise, the software and the experience. In April of 2014 Nike choose to shut down the Fuel Band. Many of its engineers left to work on the Apple Watch. The Fuel Band was a failed product after less than three years. Retrospectives in the trade press have attributed the failure to competition, the challenge of focusing on new areas like software, and the lack of clear understanding of consumer motivations to embrace wearable tech. In short, no one thing, and nothing that was obvious beforehand. Perhaps the hardest failure case to predict.

But, 2012 was different than 2000. The technology to tease apart the components of success and failure were available even then. In 2012 Growth Science took a look at Nike’s initiative using their advanced analytic system. Their conclusion, documented at the time, was that Nike should not pursue the Fuel Band as they were doing but to stop and pivot. But why? What was clear then?

The Fuel Band opportunity was certainly new to Nike, but less new was the situation in general. Growth Science analysis indicated that much about the Fuel Band business patterns was positive – Market Momentum was there, and Market Profitability outlook was also positive. Even the Competitive Situation was encouraging. Growth Science’s simulation engine was able to plumb the world of patents and business press to assemble and tease apart what was a competitive threat and was just competitive noise. And competitive alternatives we’re not the warning flag.

What was apparent, however, was  poor Parent Company Fit. This was despite Nike’s track record of stretch goals into new markets and models in the past. Past attempts and successes include going into international markets (1981), launching a chain of retail stores (Nike Town 1990), entering the sporting equipment market (1996), and pursuing web-commerce (Direct-to-consumer Internet sales 1999). But the simulation revealed that this time the fit was of a different nature. Executive commitment, if the patterns proved correct, would be lacking this time. Altogether, weighing the good and the bad, even as early as 2012, the prognosis was a mere 21% chance that the Fuel Band would live out the next 10 years. It lasted two.

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