As Fitbit Prepares for IPO, New Consumer Research Reveals Areas of Wearables Market Vulnerability for Fitness Band Leader
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Los Gatos, CA (PRWEB) May 21, 2015
With Fitbit's recent S1 SEC filing and the pending IPO, scrutiny of the data regarding the company's market strength has become intense. Since Fitbit introduced its first fitness band and activity tracker in 2011, the company has dominated the category, but data released today from Argus Insights reveals some areas of new vulnerability. In the global wearables category, Argus Insights foresees Fitbit market share slipping as smartwatches, which also track fitness and activity, continue to gain ground. The Argus Insights report is derived from an analysis of wearables research based on information from more than 100,000 global consumers.
"While Fitbit is clearly the overall leader compared to the other fitness bands such as Jawbone, Garmin and Misfit, a lead that is continuing to grow even over the last month, in the overall wearables category where smartwatches come into play, fitness bands in general are dropping as a share of the market," said John Feland, CEO and founder, Argus Insights.
Fitbit is losing out as a part of this comprehensive wearables category with a mindshare ranking of far less than the 68-percent market share disclosed in the S-1. Says Feland, "Fitbit will need to differentiate itself more as almost any smartwatch and other wearable product out there will tell you how many steps you took and lets you share that information with your friends."
"Fitness bands stop being useful and people lose their fitness momentum – all similar reasons as to why people quit going to the gym," Feland said. "For Fitbit to continuously grow, they will need to keep users engaged and give them reasons to buy new versions of the products. Right now our data indicate that other more comprehensive devices are taking over for fitness trackers."
Argus Insights also expects the number of white label fitness bands to increase in six months –just as white label tablets proliferated. "It won't matter that the generic fitness band does not have the brand identity. It will definitely be cheaper and work almost exactly the same way."
"To sum up," says Feland, "we think Q2 is looking weak for Fitbit compared to the other brands globally. They are especially impacted by slack demand for their smartwatch which was introduced in December. We recommend a wait and see attitude when it comes to Fitbit and their future."
Argus Insights has identified several areas of market concern as Fitbit heads to its IPO:
• Fitbit's overall leadership in the wearables space is less than 50%, even as its S1 claims it has 68% of the fitness band market in the US. Fitness bands comprise two-thirds of the overall wearables market.
• As the overall wearables demand drops in the expected post holiday slow down, interest in Fitness Bands is dropping faster than Smart Watches, impacting Fitbit's expected Q2 performance. In fact fitness band interest is down to the same levels as May 2014, not a good sign of future robust consumer demand.
• Although Fitbit's social engagement with both free and premium users sharing results with friends and family creates a strong switching cost to other products, the biggest competitor is still the sock drawer with over 60% of purchasers of Fitbit devices through 2014 giving up as active users.
• The Fitbit Surge, Fitbit's smartwatch, had a rocky launch over the holidays when users' reactions were extremely negative, and Fitbit is only now recovering. Improved strength with Fitbit's watch is very important if the company wants to compete with the Apple Watch and myriad other smartwatches now on the market.
• One other area where competitive pressures may come to bear, according to Feland, is in the growth of cheaper, while still adequate, white label fitness bands enabled by motion sensor suppliers like Invensense and its Sharkband fitness band reference platform
For more information about the Argus Insights Fitbit Demand Report, visit http://www.argusinsights.com/fitbit-ipo/
About Argus Insights & Methodology
Argus Insights is a new type of market intelligence company founded by tech industry veterans seeking to connect the dots between technology innovation and consumer adoption. Argus Insights provides focused and actionable analysis on where consumers are taking the market, who is winning and why. Argus Insights is continuously monitoring millions of consumer reviews and comprehensive social conversations to derive feedback straight from the source. Our proprietary metrics of consumer mindshare and delight allow us to identify what attributes are important to the end user, rank product and brand performance, and accurately forecast adoption.
Argus Insights creates monthly mindshare analysis reports for paid subscribers within days of the month's end so clients can act quickly, rather than wait for traditional reports which lag more than a month behind. For more information, visit http://www.argusinsights.com/ .
Read the full story at http://www.prweb.com/releases/2015/05/prweb12739288.htm
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