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FitBit
- 1. Mike Rueffer Principles of Marketing November 30, 2015
- 3. Fitbit Overview Founded in 2007 Headquartered in San Francisco, CA 8 other office locations Boston, Dublin, Hong Kong, Shanghai, Seoul, Minsk, New Delhi, Tokyo Fitbit retailers are located in 9 countries Offering a range of products
- 4. Fitbit Overview Cont. Around 1000 employees Revenue growth of 258% in 2Q of 2015 Consumer Electronics NYSE: FIT Current Stock Price- $27.84
- 5. Mission Statement To empower and inspire you to live a healthier, more active life. We design products and experiences that fit seamlessly into your life so you can achieve your health and fitness goals, whatever they may be.
- 6. Vision Statement We’re a passionate team dedicated to health and fitness who are building products that help transform people’s lives. While health can be serious business, we fell it doesn’t have to be. We believe you’re more likely to reach your goals if you’re encouraged to have fun, smile, and feel empowered along the way.
- 7. Company Environment “Keep employees happy, healthy and engaged by creating an effective wellness program with Fitbit.” Active environment Forbes: #1 hot company to work for in San Francisco
- 11. External Marketing Environment Political- Privacy Laws Selling your personal data. 1. We will only collect data that is useful to improving Fitbit products, services and your experience. 2.We will be transparent about our data practices and will explain them in clear language. 3.We will never sell your data, and will only share personally identifiable data when you direct us to (or under the circumstances outlined in our Privacy Policy). 4.We will always take the security of your data seriously
- 12. External Marketing Environment Economic- Floating with the market Extra Commodities
- 13. External Marketing Environment Social/Cultural- Demands of the consumer The product is universal for everyone Specific products tailored to certain groups
- 14. External Marketing Environment Technological- Technology Industry Staying ahead of the competition App to track progress
- 15. Industry Analysis Projected 35% growth in wearable technology market next 5 years Many major companies in the Industry
- 16. Competitive Environment Competitors Nike- FuelBand, Nike+ SportWatch GPS Apple- Apple Watch Jawbone- UP24 Garmin- Vivofit
- 17. Positioning Map
- 18. Global Analysis 8 other office locations Boston, Dublin, Hong Kong, Shanghai, Seoul, Minsk, New Delhi, Tokyo Fitbit carried in over 50 countries “Fitbit intends to sell its products and services in new and existing international markets by expanding its distribution channels with retailers and by forming strategic partnerships”
- 19. SWOT Analysis Strengths • High Market Share • Global Expansion • Necessary components • Product Line • Growth in the market Weaknesses • Lack of brand Recognition • Higher price for limited upgrades • Limited Retailers Opportunities • Expansion Globally • High end products • Advertising Threats • Competitive Market • Consumer Interest • Aggressive pricing strategies • Technological Advancement
- 21. Introduction Fitbit retails their product to virtually anyone in the world. Their name sells their product- “fit” Target Market 1- Physically active people Target Market 2- People who want to adopt a healthier lifestyle Target Market 3- Corporations and Enterprises Target market 4- Athletes
- 22. Product Fitbit Trackers Zip One Flex Charge Charge HR Surge Aria Competitive Advantage: Yes
- 23. Place Distribution Channel Logistics Create great partnerships Create facilities to lower costs Manufacturer Fitbit Retailers Consumer Competitive Advantage: Yes Manufacturer Fitbit Consumer
- 24. Place
- 25. Promotion Advertising $70 Million is 2Q of 2015 $13 Million in 2Q of 2014 Promote their brand not necessarily individual products Promotes corporate usage Competitive Advantage: No
- 26. Promotional Mix Television https://www.youtube.com/watch?v=PY_zEa7hhy4
- 28. Promotional Mix Partnerships with famous people Comedian Joel McHale
- 29. Price At the Market Pricing Strategy Lowest price at the market Deals with corporations No discounts unless big shopping day The more the product does the higher the price Competitive Advantage: Yes
- 30. Concluding Remarks Fitbit is in one of the fastest growing markets Global expansion is huge Expand their product line to premium products Continues to use the at the market pricing strategy Great Company to work at
Notes de l'éditeur
- Hello, my name is Mike Rueffer and I am going to speak with you a little bit about Fitbit and their marketing strategy.
- Since their founding in 2007, James Park the current CEO, and Eric Friedman the CTO have built Fitbit into the world’s largest wearable technology and activity tracker company located in San Francisco, CA. With Fitbit’s recent expansion as a company they have opened a total of 8 offices around the world in Boston, Dublin, Hong Kong, Shanghai, Seoul, Minsk, New Delhi, and Tokyo while still looking to expand. These offices allow for easier communication, distribution, and it also allows for hands on actions if there are problems around the world. While there are retailers located in 9 different countries I will explain later on why they are available in more countries than that. They offer a range of fitness products from an interactive scale to a basic pedometer, to a GPS watch.
- Fitbit employs around 1000 employees. Most of their revenue is generated from wearable, connected health and fitness devices. In the second quarter of 2015 Fitbit sold 4.4 million devices compared to 1.7 million during the same period last year, that is a growth of around 258%. They trade on the NYSE under the ticker symbol of FIT and as of this morning they were trading at a price of $27.84
- There mission statement is very simple… “To empower and inspire you to live a healthier, more active life. We design products and experiences that fit seamlessly into your life so you can achieve your health and fitness goals, whatever they may be.” They put an emphasis on living healthier lives and being able to design a product that will help you achieve your health goals, no matter how small or big.
- Although Fitbit does not have an official Vision Statement this statement is posted on their website on their “Who We Are” page, “ We’re a passionate team dedicated to health and fitness who are building products that help transform people’s lives. While health can be serious business, we fell it doesn’t have to be. We believe you’re more likely to reach your goals if you’re encouraged to have fun, smile, and feel empowered along the way.” Fitbit emphasizes themselves being more than a company that is selling a product. They are a company that is going to help you reach your goals and continue to live a healthy life, in a fun and inspiring way.
- Fitbit has had a lot of recent success. They contribute a lot of that success to their employees. Fitbit offers multiple perks of working for a fitness company. They have a goal that is stated on their website, “Keep employees happy, healthy and engaged by creating an effective wellness program with Fitbit.” Fitbit also offers an Active environment to their employees such as treadmill desk and open airy workspace that encourages movement. Because of all of this Fitbit is the best company to work for right now in San Francisco according to Forbes.
- Headquarters in San Francisco.
- Political- Fitbit has the usual legal and political issues that any technology company has such as copyrights. However one of the more interesting ones that I know everyone is dealing with now is Privacy Laws. Fitbit vows under their privacy agreement they will not sell your personal data. They outline these 4 points in privacy agreement.
- Economic- Fitbit produces what would be called extra commodities. Something that people don’t necessarily need but they want. Because of this their product sales usually float with the market. As they were founded the year before the market crashed, they have shown they are able to survive a downturn in the market. As you can see by the chart, their sales have grown over the past 2 year. As you probably know, the economy has been growing during that time as well.
- Social/Cultural- Fitbit has done a good job of trying to meet the demands of most consumers. Their full line of products tailor to specific consumers. They are able to reach multiple consumers that all want something different instead of only creating one product. As for cultural diversity, Fitbit does a great job of this, their products are available around the world, and you are able to purchase them from virtually anywhere.
- Technological- Fitbit, being a technology company is ahead of the competition. They control 85% of their market so they are able to essentially set the standard. Along with their fitness tracking bands, you are able to download an app that will allow you to track your progress on anything from steps in a day, calories burned, calories consumed, hours slept and your weight. Now a lot of these you need to enter yourself but this is a great app that allows you to personally keep track of your progress with the aid of Fitbit.
- The wearable technology is still a new and fresh idea. With that said there is a lot of room for potential growth. Experts are predicting a 35% growth within the industry in the next 5 years. Many companies such as Nike, Garmin, and Apple among others are trying to join in on this movement. Although Fitbit does control 85% of the market there is plenty of growth potential and because of this reason Fitbit needs to stay ahead of the game.
- Of the 15% left in the market that Fitbit does not control, there are major brands competing against Fitbit. Nike and their FuelBand and Nike+ SportWatch GPS posed a threat against Fitbit for a while when they came out. Nike has since discontinued these products. A big reason why they are still a competitor is their products are still sold by other retailers such as Amazon. Apple is probably Fitbit’s biggest competition currently. They offer a high end Apple watch and a sport version Apple watch. These retail anywhere from $349 to $15,000 for their highest end watch. Apple watch give the consumer a ton of options along with connecting their iPhone to watch just like Fitbit. Jawbone offers the UP24 tracker which allows for you to keep track of your sleep, and your activity. This has to be done on an app. Unlike the Fitbit Charge, UP24 does not offer a screen on the front for you to be able to tell the time, see how many steps you’ve taken, how many flights of stairs you’ve climbed, or how many calories you’ve burned. Lastly, Garmin Vivofit, Garmin has written under the description, “it can stay on for more than a year without a battery change”. This is great however after that you need to change the battery instead of charge it. Vivofit offers a display screen on the band, giving you the time, and tracking your heart rate among other things.
- Fitbit’s growth globally is critical for the growth of the company as a whole. They have set themselves up well by strategically placing their offices around the world As I previously stated this allows for easier communication within a specific region instead of everyone reporting everything back to one location. Fitbit’s products are carried in over 50 countries. I stated earlier that retailers of Fitbit are located in 9 countries and this is true. The retailers are located in 9 countries but they distribute their products all around the world. You can order a Fitbit on their website and have it ship anywhere. As stated by MarketRealist.com, “Fitbit intends to sell its products and services in new and existing international markets by expanding its distribution channels with retailers and by forming strategic partnerships”
- Fitbit SWOT analysis is as follows. Their Strengths include… A high market share. As I previously stated they control 85% of their market. Global expansion, they are expanding and are available for purchase all around the world. Necessary components and Product line, Fitbit offers almost everything a consumer could want through a fitness tracker. Growth in the market- the market is going to grow over the next 5 years as previously stated. Opportunities include… Expanion Globablly which Fitbit is jumping on as they are trying to secure partnerships and more deals with retailers around the world High end products. Fitbit lacks appeal to a high end market. They do not have the $500 watch that people may want that apple can offer Advertising, Fitbit is just now getting into advertising. Before this year there was virtually no advertising. Weaknesses include… A lack of brand recognition, Fitbit is not really a well known brand globablly yet. Higher price for limited upgrades. They obviously charge more for their products with more features but a lot of them are limited upgrade features. Limited Retailers, There is a small amount of retailers that allowed to sell Fitbit’s in their store. So for the people who do not shop online they are not reaching them. Threats include... Competitve market, the market is competitive even though they control a major part of it Consumer interest. Tech Republic reported that consumers will stop using the product in 6 months if they lose interest. Aggressive Pricing Strategies by competitors Technological Advancement, with the amount of technology in today’s society there is not telling what is coming next from companies
- A big part of Fitbit and their marketing strategy is their product itself and how they present it to the consumer. Their name sells their product- “Fitbit” you hear fit and you instantly think a fitness company. Among their target markets you can see they have 4 distinct markets. 1- Physically active people who want to looking to track their movements 2- people who want to adopt a healthier lifestyle and want help staying on track 3- Corporations and Enterprises that are looking for healthier employees. Healthier employees means the potential for lower health insurance. Wellness programs are offered to corporations by Fitbit. 4- Athletes who are looking for a GPS watch that can track where they run
- Fitbit’s Logo has an arrow simulating movement and encouraging people to get moving. Fitbit’s product line is tailored to everyone- the person who wants to know how many steps they are taking, to the avid runner who wants GPS tracking for when they run. Looking at the most popular Fitbit, the charge, there are features such as time and date, step count, calories burned, and stairs climbed displayed on the tracker. While looking at the app that you can download you can see that there is tracking for your sleep, the amount of water you intake, the amount of calories you intake, and more. The packaging for many of the products is as you can see here… It is clear so you can see the actual product you are going to be wearing. Yes they do have a competitive advantage. With their product line they are able to reach multiple target markets and expand their reach to different types of markets.
- Fitbit has two main distribution channels… Manufaturer- Fitbit- Retailers- Consumer OR... Manufacturer-Fitbit-Consumer Both have their own advantages. The partnerships with the retailers are the real place for Fitbit. Most people go into stores and see the product displays and this is often what will determine whether or not the consumer will purchase their product. Yes Fitbit has a competitive advantage: By having Great partnerships instead of just letting everyone sell their products they allow for a greater control. The name recognition with these retailers helps increase the value of their products.
- Fitbit is just starting to really get into advertising as you can see by these two numbers… $70 Million in second quarter of 2015 versus $13 million in second quarter of 2014... They have emphasised advertising however it is mainly for their brand so it is hard for people to recognize what product they exactly want from Fitbit. They also do a great job of promoting their wellness programs to corporations, I know this first hand from my dad who’s company uses Fitbit’s wellness program. No they do not have a competitive advantage as they do not advertise enough to give them an advantage.
- The promotional mix consists of TV like this commercial
- Magazine ads like this one…
- And Partnerships with famous people like comedian Joel McHale
- Fitbit uses an at the Market Pricing Strategy. However they still try to keep their prices as low as possible at the market. They do this by partnering with well known retailers. These partnerships give Fitbit an edge because it backs their product with a reliable name and well respected company. The deals they workout with corporations allow consumers to buy them at a discounted price. Fitbit is really banking on the fact that if they give a better price to a corporation that the companies employees will buy more product. Yes they have a competitive advantage. Simply put the price you are paying for the product and the amount of features is more than fair.
- In conclusion, Fitbit is in one of the fastest growing markets with the ability to grow immensely globally. I believe that with this growth there is a potential to expand their product line to a more premium brand and target more people. I would suggest to continue using at the market pricing strategy if they do chose to expand their product line. Overall they are a great company to work for, and they have a great product.