How many steps have you taken today? This is a question that makers of fitness trackers hope people will continue to ask. If you pay attention to the technology industry, it may seem like this industry is determined to make people healthy. Wearable products like fitness trackers continue to appear on the market that are focused on creating healthier lifestyles. Two companies that are responsible for a lot of this attention are Fitbit and Jawbone.
With 76 percent of the market share, Fitbit is the leader in the fitness tracker space. The company garnered attention recently, because it went public in June. Since then, its stock price doubled in value. Consequently, Fitbit seems to be doing well. The true test is whether Fitbit can sustain this success over time. Fitbit has six products on the market, but it has not fully clarified its position. More specifically, Fitbit bracelets being made by a fashion designer and celebrities endorsing Fitbit creates some murkiness regarding how much Fitbit products are fashion items compared to fitness items.
One of Fitbit’s chief competitors, Jawbone, has been in the news a lot because of its actions toward Fitbit. More specifically, Jawbone has filed three lawsuits against Fitbit in two months. According to Fortune, Jawbone filed two lawsuits claiming that Fitbit had stolen trade secrets when it hired some of Jawbone’s former employees. The lawsuits were filed in San Francisco Superior Court and in the United States District Court for the Northern District of California. In a little more than two weeks ago, Jawbone filed a third lawsuit with the International Trade Commission in order to block Fitbit from importing fitness trackers or their parts. Jawbone’s delays regarding one of its newest fitness trackers along with a new $300 million round of funding that’s believed to be needed to keep Jawbone afloat make you wonder how Jawbone can manage all of these things in order to stay in business.
Fitbit and Jawbone now have competition from Apple Watch and other smartwatches that provide the same functionality of fitness trackers plus additional features, such as showing news updates and boarding passes for flights. According to Forbes, Apple Watch has been a disappointment. For example, Apple Watch eats up your iPhone battery, and the interface for the Apple Watch is not as intuitive as the iPhone. At this point in time, the Apple Watch does not appear to be a big threat to fitness trackers, but that could quickly change if Apple addresses the preceding issues.
Even though Fitbit currently seems to be sitting in a comfortable spot compared to other fitness trackers, it cannot become complacent. Sales of Fitbit and other fitness trackers are strong, but many of their owners lose enthusiasm for them once the initial interest in knowing how many steps they’ve taken fades. A market research firm, Endeavour Partners, estimates that about a third of fitness trackers are abandoned after six months. According to investment fund, Rock Health, Fitbit’s regulatory filings suggest that only half of Fitbit’s nearly 20 million registered users were still active as of the first quarter of 2015. So, there is more work to be done if Fitbit and other fitness trackers want to have success over time.
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Ryan Lahti is the founder and managing principal of OrgLeader, LLC. Stay up to date on Ryan’s STEM-based organization tweets here: @ryanlahti
(Photo: Wearable Technology for the Wrist, Flickr)