Fitbit -Steps toward Victory June 11, 2022

Blog Article

INSIDE
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Fitbit Market Report

Since the introduction of the Fitbit technology the famous health slogan had now changed from “An apple a day keeps the doctor away “to “10,000 steps a day keep

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Market Analysis

the global wearable technology market is projected to surpass US $ 380.5 billion by 2028

Fitbit Market Story

-Elizabeth Mathew

It is very rare to come across anyone without a wearable device on their hands or around

their necks these days. Fitbits became a trend in the mid 2010’s when the hype was all about

health and fitness. The popular marketing campaign of 10,000 steps a day is a default setting

on this wearable technology device that encourages every user to walk a minimum of 10,000

steps or 30 minutes of activity for optimum physical health. The 10,000 steps or Manpo-kei

was a marketing campaign strategy which was initially a number that the Japanese came up

with to sell pedometers. It had become the fitness magic goal number for a regular exercise

regimen for them. Since then, it has become the medical standard all around the world that

the experts agree on. Since the introduction of the Fitbit technology the famous health slogan

has now changed from “An apple a day keeps the doctor away “to “10,000 steps a day keeps

the doctor away”.

Fitbit is a wireless-enabled wearable technology that uses AI machine learning algorithms to

track every movement, sleep patterns, heart rate, mental health and even menstrual health in

women. A colleague of mine used to joke that he would put the tracker on the dog to trick his

wife into thinking he had walked so many steps a day. Unfortunately for some others like

me, it is a reminder of how little I have stepped in a day and how unfit I am. It is incredible

how this innovative technology has changed the face of the health and wellness industry.

Beginnings

The company was founded in 2007 by James Park and Eric Friedman. They launched their

first Fitbit tracker in 2009. They sold over 5000 units in the first launch and put another

20,000 orders on their books. The product had promise from the very beginning. With most

millennials and Generation Z committed to a healthier lifestyle than the previous generations,

it was no surprise that this technology was going to be the next biggest thing since video

streaming and fast internet.

Right after their launch in 2009, they were able to raise more capital with the help of venture

capitalist Brad Field. The also partnered with Best Buy to sell their devices across all their

stores. In 2011, they made improvements on the tracker by adding an altimeter, digital clock

and a stopwatch. By 2015, the company had decided to go public and announced its IPO on

the NYSE. In 2016, one of the co-founders of the company announced that Fitbit was going

to make its transition from a “consumer electronics company” to a “digital health company”,

which very closely followed their acquisition of the smartwatch company Pebbles for $23

million. Then began the era of the health metrics smartwatch. In 2017, they released the

Fitbit Ionic smartwatch that entered the market at $299, which included a built in GPS,

contactless pay, improved heartrate tracker and a music player. Their top marketing feature

for the watch was the oxygen saturation sensor that

It was not until 2014 that Fitbit started offering in addition to their activity trackers,

integration on phones for android and apple mobile users with accessibility to their

apps ,with updated visual dashboards and stats via Bluetooth sync ,to guide users to make

the best health choices and set realistic health goals for themselves .From just tracking their

steps, Fitbit has evolved to give users the ability to track over time their food, activities and
weight using measures such as steps walked, calories consumed and weight gained or lost.

Between 2018 and 2021, Fitbit evolved even further to include other health metric features

such as an oxygen saturation sensor, stress sensor and skin temperature. The Fitbit app also

has a community page that allows users to communicate the successes and failures of their

health journey with pictures and allows them to motivate others through various

competitions. Fitbit has a range of stylish functional products in different price ranges,

targeting mostly customers who are working professionals, between the age of 25 – 40 years

(millennials) and lower-upper middle-class cohort. The consumer group was always too busy

to exercise and so by associating style with physical activity, Fitbit has made this the theme

of their marketing campaign.

Fitbit-Steps toward Victory

Market Analysis
-Elizabeth Mathew

The Fitbit story is a successful story in my opinion. But even

companies as successful as Fitbit need to understand that they

need to continually innovate to keep up with their competitors

or there will be missed opportunities. To date the company has

sold over 120 million devices and has over 29 million users

from all over the world according to Wikipedia. The company

was recently acquired by Google for 2.1 $ Billion with an

Exhibit A (Statista,2021)
objective to make health and wellness available to all people.
Strategies to Success
According to the global newswire, the global wearable
Even though Fitbit has lost market share, they have
technology market is projected to surpass US $ 380.5 billion by
continued to add more active users on its platform. In recent
2028. In 2014(Exhibit A), Fitbit market share of shipped
years, Fitbit has come out with smartwatches in direct
products was 37.9%. Their market share had considerably
competition with Apple, but they continue to remain
dropped over the last some years as they were a little late
focused as a digital health IoT device. Sustainability has
getting into the smartwatch sector when companies like Apple
become a key environmental factor in ensuring their
took advantage of the consumer shift to smartwatches. In 2020,
success in the technology market. They remain focused on
Fitbit reported a net loss of $190 million.
lower impact production, consumption and value chain

responsibility. They also ensure that all their suppliers are

following fair labor and sustainable practices. The threat of

new entrants to the industry are eminent and present as they

come up with other low-cost strategies, more innovative

products and a strong value proposition but Fitbit has a

competitive position over them because of its product

differentiation, economies of scale, strong distribution

channels and its market reputation. By using a

differentiation marketing strategy, they continue to

maintain a strong market position with some major players

in the wearable technology industry

The 4P’s

One of my most favorite times of the year is boxing day. I

am always looking for great deals in electronic items. In

terms of pricing, Fitbit is always offering great affordable

prices through promotions for their products on special

occasions as well as allowing customers to upgrade thereby

creating a loyalty for the brand. They use an odd-even

pricing strategy which is like charm pricing. For example,

last year when I bought my Fitbit versa 3 on boxing day, it

was an easy decision to make the purchase as the device

which was normally priced at 219.95 CAD was going for

159.95 CAD. They are also priced competitively compared

to similar products sold in the industry. They make their

products available for purchase online as well as in stores

across Canada and around the world. Fitbit’s technology

continues to serve a wide range of customers with their

various functional features, meeting needs specific to each

customer, regardless of age or gender.