Last week, Fitbit filed an IPO, revealing its intentions to go public. This is just one of many successful marketing strategies Fitbit has used to expand its’ growth.
Fit Bit’s sales have doubled every year for the last three years. Out of the $745 million in revenue it received last year, $132 million of that was profit. There is a $200 billion market for health and fitness products, something Fitbit, which specializes in wearables for fitness health, wants to tap.
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Fitbit also wants to work with employers who offer “fitness challenges” and other health programs that are typically offered through the company’s health and/or life insurance. Fitbit announced just last month its partnership with John Hancock, a well-known life insurance company. The partnership has John Hancock offering lower rates to insurers who wear Fitbit.
Fitbit said it has sold 21 million devices since 2008, 11 million last year alone. There is a huge, growing market for fitness wearables, and Fitbit is hoping to capitalize on that market. Several other companies are developing smartwatches (Apple, Google and Motorola, to name a few), while others such as Microsoft, Oculus VR and Samsung are trying to develop the top virtual reality headsets.
For those who want to buy in, Fitbit will be publicly traded on the New York Stock Exchange under the ticker “FIT.” Before doing so, there a few things traders may want to know. While it certainly has enjoyed record profits, Fitbit’s fiercest competitor is Apple, who just launched the Apple Watch, Apple’s version of the latest in wearable fitness tracking devices.
Fitbit wearers have also complained that the product irritates the skin, forcing Fitbit to do an involuntary recall of the Fitbit Force last year. The Consumer Protection Agency has reported 9,900 cases, and Fitbit has acknowledged that the product can cause skin irritation not uncommon to other rashes caused by jewelry, detergents, etc.
The longevity of the company depends on its ability to hire and retain highly talented workers due to its location where there is a lack of skilled talent. Fit Bit’s employees are also not contractually obligated, so they are able to leave at any time.
A couple of positives are that Fitbit has a celebrity following. President Barack Obama was recently photographed wearing a Fitbit Surge. Others seen wearing the trackers are Kelly Ripa and Shaquille O’Neal. The Fitbit also has a built-in smart scale, making it more than just a watch. Launched in 2012, it connects to Wi-Fi and can keep track of weight, body-fat and mass index. It can store data for up to 8 users – enough for the entire family.