Introduction Fitbit Inc. launched in 2007 and exploited new internet-based technology to produce digital fitness trackers. This paper will analyse the internet’s impact upon Fitbit’s competitiveness and profitability, by analysing its competitive environment, business model and internal characteristics. Profitability Fitbit’s profitability After making losses between 2011 and 2014, Fitbit made a profit of US$131,800,000 in 2015 (DiBenedetto, 2015). It is the current market leader with an 87% market share (by US dollars) between January and October 2015, previously being 68% and 58% over the same period in 2014 and 2013, respectively (NPD Group, 2015 cited in Gallagher, 2015); and had the largest market share (in unit shipments) in 2014 and …show more content…
Partake in high-intensity and long-duration fitness activities and endurance sports e.g. distance running and cycling, and “thrive on personal improvement and competition” (ibid, p90). Interests: Same as Active Users’, along with tracking exercise routes and speed through GPS (ibid). Clients • Physical and online retailers in 50+ countries varying in type (mass, specialised, wireless carriers) and size (ibid). • Consumer direct channel: Fitbit.com (ibid). • Corporate wellness channel: Products and services sold; directly to employers wanting to improve their corporate wellness programs “or through partners [e.g.] wellness program providers and insurance companies” (ibid, p90). End customers • Six different interactive and personalised health and fitness tracker platform-based devices to suit each user group’s lifestyles and needs/interests. • Ability to sync tracker with computer and 200+ different mobile devices, and connect it with 1000+ third-party apps through Fitbit’s open web API (Application Performance Interface) …show more content…
Interconnectedness • All resources interconnected. “Specialised focus on …building … connected health and fitness platform… [contributed to well-renowned brand reputation of] becoming synonymous with…connected health and fitness category” (ibid, p88) may have helped gain well-established strong retail presence. Brand reputation, broad compatibility and open API helped establish largest connected health and fitness user community. • Brand image majority of sales on Fitbit.com suggests consumers specifically want to buy Fitbit rather than alternatives largest user community. Time compression diseconomies • All stocks developed over time- difficult for competitors to imitate and achieve in short-term. • Global well-established strong retail presence-“unmatched in the connected health and fitness category and would be difficult for a competitor to replicate” (ibid, p89). • Had API before competitors who do not have such large ecosystem and user base (ibid). Fitbit’s internal organisation system The analysis below explains how; Fitbit efficiently uses its strategic resources and, its interconnected stocks have contributed to its