Fitbit, Inc.: Has The Company Outgrown Its Strategy?
Fitbit is transforming the way millions of people around the world achieve their health and fitness goals. The Fitbit platform combines connected health and
fitness devices with software and services, including an online dashboard and mobile apps, data analytics, motivational and social tools, personalized insights, and
virtual coaching through customized fitness plans and interactive workouts. Our platform helps people become more active, exercise more, sleep better, eat
smarter, and manage their weight. Fitbit appeals to a large, mainstream health and fitness market by addressing these key needs with advanced technology
embedded in simple-to-use products and services. We pioneered the connected health and fitness market starting in 2007, and since then, we have grown into a
leading global health and fitness brand.
The core of our platform is our family of wearable connected health and fitness trackers. These wrist-based and “clippable” devices automatically track
users’ daily steps, calories burned, distance traveled, and active minutes and display real-time feedback to encourage them to become more active in their daily
lives. Most of our trackers also measure floors climbed, sleep duration and quality, and our more advanced products track heart rate and GPS-based information
such as speed, distance, and exercise routes. Several of our devices also feature deeper integration with smartphones, such as the ability to receive call and text
notifications and control music. To accompany certain of our products, we offer accessories that include interchangeable wrist bands and frames, colored clips,
device charging cables, wireless sync dongles, band clasps, sleep bands, and Fitbit apparel. In addition, we offer a Wi-Fi connected scale that records weight, body
fat, and BMI. We are able to enhance the functionality and features of our connected devices through wireless updates.
Our platform also includes our online dashboard and mobile apps, which wirelessly and automatically sync with our devices. Our platform allows our users
to see trends and achievements, access motivational tools such as virtual badges and real-time progress notifications, and connect, support, and compete with
friends and family. Our direct connection with our users enables us to provide personalized insights, premium services, and information about new products and
services. Premium services include virtual coaching through customized fitness plans and interactive video-based exercise experiences on mobile devices and
computers. In addition, we extend the value of our platform through our open API, which enables third-party developers to create health and fitness apps that
interact with our platform. Through our open platform and our large community of users, we have established an ecosystem that includes thousands of third-party
health and fitness apps that connect with our products and enhance the Fitbit experience.
Our platform enables all types of people to get fit their own way, whatever their interests and goals. Our users range from people interested in improving
their health and fitness through everyday activities to endurance athletes seeking to maximize their performance. To address this range of needs, we design our
devices, apps, and services to be easy to use so that they fit seamlessly into peoples’ daily lives or activities. Our users can sync their Fitbit devices with, and view
their dashboard on, their computers and over 200 mobile devices, including iOS, Android, and Windows Phone products. This broad compatibility, combined with
our market-leading position, has enabled us to attract what we believe is the largest community of connected health and fitness device users. The size of our user
community increases the likelihood that our users will be able to find and engage with friends and family, creating positive network effects that reinforce our
growth. In addition, data from our large community enables us to enhance our product features, provide improved insights, and offer more valuable guidance for
1. What is competition like in the activity tracking industry? How strong is the competitive strength of buyers and suppliers? New entrants and substitute products? Rivalry among competing sellers? Prepare a Five Forces Model of Competition to support your conclusions.
2. How would you best describe Fitbit’s competitive strategy?
3. Perform a SWOT analysis for Fitbit. What are the company’s primary strengths and weaknesses? What external opportunities and threats exist?
4. Analyze the company’s financial performance. Do trends suggest that its strategy is working?
5. What recommendations would you make to Fitbit management to address the most important strategic issues facing the company?
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