Study On Fitbit Product Consumer Behavior

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Requirement

The Task:

Based on the scenario below, you are required to write a 2000-word report. In this report, you must demonstrate an understanding and application of various consumer behaviour concepts and theories by analysing the facts gathered from the video and the survey, and present strategic recommendations. You will be required to incorporate recent peer reviewed literature in order to justify your proposed recommendations. 

Scenario:
Imagine that you have just been employed by the company you analysed in your earlier assessments. You have recently learnt that the company’s customer loyalty has declined over the last year and that repeat purchases are at a historic low. You have now been asked to prepare a report outlining the issues you identified in your previous analyses, issues related to current marketing communications, and to provide at least three strategic recommendations to the board of directors, along with reasons for recommending further improvements, all of which must be based on scholarly sources.

Solution

Executive Summary 

Fitbit products are known for its sensors and wireless technology and sensors since it came into existence. It is among the few players in business industry that has given importance to health and fitness with the product and services they offer. Fitbit Inc. has achieved immense success with the quality of product and services like its tracking devices, watches, headphones and other accessories. 
Every company goes through the business cycle and each of its stages come one after other which is inevitable. This company has also started with a bang in market and with the short lifespan of 10 years, it became popular in global scenario but it is now entering into decline phase as not only the sales and revenues are going down day by day but also it is losing its market share in its segment where it was once dominated. Why it happened?
The survey conducted on one of its most popular product Fitbit charge 2revealed that there is no such issues with inferiority of product making by the organization still the organization is facing a huge declination in its loyal customers. It is also found that the repetition of customers is also falling day by day. 
In this report, I am going to address the issues that I have identified with Fitbit products and its marketing and communication strategies. Here at first I am going to analyse the problems with consumer behaviour perspectives and then its marketing strategy will be evaluated to arrive at the solutions.
The aim of this report is to bring some feasible and logical recommendations that may will help the company to bring the business graph into growth phase. 

Fitbit product and service

The product and service structure of Fitbit Inc. has been divided into 3 major categories which are as- Fitbit trackers, Fitbit watches, Fitbit ear phone and accessories and its service known as Fitbit Coach. 

• Fitbit Trackers- It is a small electronic device that can be clipped on cloth and can be worn for 24*7 which measures the movement of its user. It uses a 3D accelerometer which will count the no. of steps taken to calculate the distance of walking along with other things like calories burned, floor climbed, activity duration and intensity of it. It is the most sold product of Fitbit which comes in variant like Classic, Zip, Flex, Alta and Charge. Fitbit Charge 2 is the recent launch of this series and it is also the product under our study. 

• Fitbit Watches- It is a smart watch which will also work as activity tracker. Its speciality is the heart-beat rate monitoring along with tracking of pace, distance and elevation by GPS fixed on the devices. It can also work like a smart phone to display text alert and incoming calls connected to the smartphone. It is coming in variant like Surge, Blaze and new arrival Ionic.[Statista Team , 2018.]

• Fitbit earphone and Accessories- The earphones are recent arrivals of Fitbit which is sweat proof and has feature of music and call control with dual microphone system. It has also feature of multi device connectivity. Talking about the other accessories, it is the collection of designer’s collection to its watch, wristband and clip segment. 

• Fitbit Coach- It is personalised training application which one can use to see unlimited adaptive workout videos and audio coaching. 

Fitbit charge 2
Accurate tracking of pulse rate 
Multi-sports tracking and GPS connection
Call, text and reminder alerts
Cardio fitness level
Guide for breathing sessions
All day activity tracking and lastly long battery life up to 5 days. [Fitbit group, 2018.]
Critical Analysis for Issues with Fitbit product 
To start with the issues critical analysis, at first we are going to check the buying decision making process that a consumer takes to buy healthcare related electronic items like what Fitbit offers. In order to pick the issues, we will go through each of its phases in decision making and will see where the problem is with Fitbit.[Deshpande, P., 2017.]

Consumer decision making-

Fitbit product is for spreading awareness of healthcare for all ages.     These products are designed with superior technology like EKGs to give better results about health while doing exercise and your day to day activities. The need of good health is for all but especially the age group from 18-45 at least need more due to the complexity of life t make work-home transition. [Allison, C., 2017]
Fitbit does not spend much on its ad campaigns and also they don’t do any buzz marketing or having social talk that will stimulate the need of people to do exercise. From the survey, it is found that customers who are in need of healthcare are looking for Fitbit option otherwise Fitbit is not stimulating the need of individual like its other competitors does. 
The survey also revealed that almost 60% of people heard about Fitbit but only 40% of them have actually opted for it. This means those gap of 20% who are haven’t gone for Fitbit must have found some good alternatives in market and it’s true that Fitbit is struggling while competing with Apple iWatch, Garmin and other products.
Why Fitbit is struggling in comparison to other? 
Despite having superior technology, comparatively low price and attractive designs, it is still not up to the mark for many people these days when it comes to evaluation of alternatives. Here are some of the common problems and issues that the user and the buyer faced or heard about these product (especially for Fitbit charge 2).
The user complained about the fiddlier nature of the bands which needs extra force to slip the band through. The technology is good but it seems complex to those who are not so tech-savvy. Some feels irritating of its functioning i.e. it needs to tap time and time again as one can’t scroll it back to main screen. Though the company has claimed its waterproofing ability still in long term uses, the lack of waterproofing comes into place. Some even found that Fitbit Charge 2 despite having good features and technology doesn’t ensure 100% accuracy about the result. Some even find it difficult to sync all info about their health after updating.[Amazon REVIEWS , n.d.]
Those who are considering the above mentioned factors are opting other alternatives like Apple watch, Garmin, Samsung gear etc. are taking the opportunity from Fitbit. As a result the market share of Fitbit has fallen by 65% in past years. 
Why people are losing trust while going for purchase? The reasons we identified are lack of brand recognition, in-stores presence, slow growth in technology upbringing and lack of feedback mechanism of the company. 
Post purchase evaluation by customers are mostly positive but with the increase in problems with its sync, technological errors and non-availability of products in stores like others. 

Factors affecting buying decisions of buyers for Fitbit 

Buying decision is influenced by many factors which are internal as well as external in nature. These are-
Psychological factors- It is the esteem need that drives the people to look good and stay fit and fine. It is the reason why people go for healthcare related gadgets like Fitbit. In our survey it is found that customer who prefers good health and fitness are going for Fitbit products. [Takacs, Jet.al2014]
But when it comes to its pricing strategy, customers are keeping doubt about the quality in relation to price. Fitbit is among the lowest costing wearable devices thus most of time customer is perceiving is of lower quality than Apple watch or Garmin Vivo Smart or Samsung Gear which is relatively higher. It is the perception of high price-high quality is deviating customers to select other brands these days. Fitbit is also failed to teach customers about using the items effectively which other brands do well which is why customers who are no so tech-smart (age group 35+) are looking for other options. 
Even Fitbit has no such active community or loyalty base that Apple has to create a strong belief and positive attitude towards the brand. It is happening because of lack of attention from the company. [Lack of Ads and promotional events]
Cultural factor- Fitbit tried to create a new culture of healthcare and fitness since it came. It tried to bring the message of “product for all” and for a number of years it succeed the market. There is no such typical religious factors that is making road blocks for the company rather the culture of hitting gyms and intense workouts among Millennial has increased over a period of time. Fitbit hasn’t promoted women fitness openly which some other did and become favourite of them. [Schütte, H et.al2016]
Considering sub-culture like income level, people with lower income or middle income group are preferring Fitbit (mostly Fitbit Blaze and Charge) due its lower pricing but those with high income hardly cares for this.Some even finds going to Gym and visiting physicians once is better than buying such things and taking care for it. 
Social factor- From the survey it is found that it is the Reference Group that is motivating the buyers to opt for Fitbit product. It is both primary and secondary groups like family members, friends, relatives, colleagues and even strangers who are doing exercise regularly suggest Fitbit to others. The company is now facing trouble with the negative comments that is spreading among the people than its positive signs. Due to lack of company’s PR plan, the negative comments are creating doubts about the quality of product in relation to the price. Like other companies, they don’t come up when any customer faces trouble thus a negative word of mouth is moving and it is one of the main reason today Fitbit is losing control over market.[Diaz, K.M.et.al2015]
There are other factors like social status and recognition where Fitbit fails to position itself as superior brand. Lack of brand awareness is causing the trouble for the products. 

Marketing Communication issues 

Fitbit has a huge issues with its marketing communication which is why we saw that 6 out of 15 have heard or used or seen to be used of Fitbit products. This clearly indicates that Fitbit is not reaching to the customers appropriately. It’s promotional and PR and CR strategies are not that good enough to compete with the superior brands like Apple and Samsung. Here are some challenges and concerns with its communication-
No such discount and other offerings on its product.
The company has no TV and other outdoor media presence which has majority of customers reaching.
It doesn’t use digital media platform much for its advertisements. (Lack of social media promotion).
Due to availability in limited stores, It doesn’t get much promotion at ground level i.e. retail level promotion.
It is still relying on Word of Mouth by its customers which is going negative most of the times.[ANNA, 2016.]
The company doesn’t have any Public Relation or Customer Relation (PR & CR) approach to its product and services. People don’t find any assistance or post purchase feedback taking from the company. 

Issues with its Marketing Strategies 

Talking about the current marketing strategy then, the company is mostly focusing on age group 18-35 years. Their target segment is mostly the average income group. The company assumes a general level of tech-knowledge within people to use the product. The aim of the marketing strategy to realise the people about the importance of health and fitness and to bring the spirit of athleticism. [Akopyan, M., 2017]
The above strategy looks god but the scope of the marketing strategy is limited and quite general in nature. Here are some of the concern areas in the marketing strategy-

1. Price- The price of Fitbit ranges from $59-$269 which is affordable for many customers but the fitness craze is more in high-end income people, sports personnel or for the celebrities. They are normally loyal and prefer high priced items to maintain the social status. Here Fitbit despite having good features fails to drag the attention of those people who has more influential power. Even the price is fixed where other keeps it flexible thus people consider other products sometime.[Weinberg, B.D.et.al2015]

2. Product- Right now they have trackers and watches as the core products to target market. The issue they are facing with products are about the technology and feature distinction from one version to other. People are unable to locate something extra in their new version. Some even said that earlier versions were good than existing offering. 

3. Place- There is no exclusive shops for this product nor sold in many stores. Mostly it is purchased online from top e-commerce sites or on own website. Due to lack of store presence and trust in online purchase people find it difficult to buy Fitbit even if interested.  

4. Promotion- They do only social media promotion thus they are unable to reach people who don’t use it or don’t have access to it. [Hong, J.C.,et.al2017]

5. People- Fitbit doesn’t represent its employees or key personnel to address the product to the customers. It is a serious problem for selecting other alternatives by customers.

6. Process- Mostly it is dependent online shopping which a limited number of people prefer and those who are concerned about money doesn’t go for it.

7. Physical evidence- 1Year warrantee with assurance of safe delivery are given on each product but no backups are taken to prove it right.

8. Fitbit has been facing troubles with the increase in competitions and slow progress in their marketing and innovation strategy. Here are some of my recommendations I would like to address.[Guerrero, J., 2015]

Recommendations 

Expansion 
Tough the company has global presence in major continents but the scenario doesn’t seem so. It should not restrict its market to US territory only.it should tap the markets where the healthcare opportunity is more like countries like India, Pakistan, African countries, UAE and other middle east countries. It should look beyond online platform and start in store presence so that more customer will get to know about the brand and its product utility.  [Smith-Dektor, A.H et.al2014]
Improvement in product features and technology 
The time has come for Fitbit to think on its product and service to make differentiation which is missing now. It should make a digital platform which gives overall health information to its customers. It can extend the facilities to glucose monitoring, blood sugar, daily medication alert etc. [Liang, Z.et.al2017]
Marketing communication 
Fitbit needs to come forward in TV and print media promotion to get the attention of people once again. Why Apple and other companies have taken the market of Fitbit, it’s not they are providing something different, it is because they are using 3 hit theory time and time again in these medium to make impression of product. It should increase its sales promotion offering like discounts, gift hampers, coupons etc. to get the average income customers more. 
It is promoting on social media platform and this can be used even in PR and CR activities for Fitbit. For ex- the Fitbit Company can open a Facebook and Twitter Community to receive the complaintsand feedbacks about the product in these medium. This can be integrated with its Fitbit Coach Application.

Marketing strategy 

First of all, Fitbit needs to change the perception of low price-low quality among the customers. This can be done with expressing the features and differentiation in comparison to other products in promotional platform. It should come up with more variant and customized products in order to offer exclusivity to the high end and fashionable customers.
To increase the loyalty, it should keep the brand promise at launching of product so that they can build trust. It should bring the employees to act as the face of organization to act as a reference group to get Word of Mouth promotion. 
Corporate partnership- Though it is not related to any customer directly but indirectly it can do promotion of Fitbit. The company can go for corporate partnership with health centres Gyms and Fitness centres which can help to create the brand awareness and loyalty. The company should also approach IT support services to fix the technology related issues of each customers without making any delay.[Lowens, B.et.al2015]
These are few things that can be done to revive the business of Fitbit. The company has started bring new products in market but to get momentum, the above things may help.

References

• Akopyan, M., 2017. Fitbit’s Marketing Strategy Has Shifted To Social And Community, s.l.: s.n.

• Allison, C., 2017. Apple Watch Series 2 v Fitbit Charge 2: Which device should you choose?. Wearable. 

• Amazon REVIEWS , n.d. www.amazon.com. [Online] 

• Available at: https://www.amazon.com/Fitbit-Inc/product-reviews/B008HPRQ3Y

• [Accessed 09 FEBRUARY 2018].

• ANNA, 2016. 4 P’S – FITBIT. Wordpress .

• Deshpande, P., 2017. www.linkedin.com. [Online] 

• Available at: https://www.linkedin.com/pulse/fitbit-strategic-analysis-parag-deshpande/

• [Accessed 9 February 2018].

• Fitbit group, 2018. www.fitbit.com. [Online] 

• Available at: https://www.fitbit.com/in/flex2

• [Accessed 09 February 2018].

• Guerrero, J., 2015. Fitbit Marketing Plan, s.l.: s.n.

• Statista Team , 2018. www.statista.com. [Online] 

• Available at: https://www.statista.com/statistics/435944/quarterly-wearables-shipments-worldwide-market-share-by-vendor/

• [Takacs, J., Pollock, C.L., Guenther, J.R., Bahar, M., Napier, C. and Hunt, M.A., 2014. Validation of the Fitbit One activity monitor device during treadmill walking. Journal of Science and Medicine in Sport, 17(5), pp.496-500.Accessed 09 February 2018].

• Diaz, K.M., Krupka, D.J., Chang, M.J., Peacock, J., Ma, Y., Goldsmith, J., Schwartz, J.E. and Davidson, K.W., 2015. Fitbit®: An accurate and reliable device for wireless physical activity tracking. International journal of cardiology, 185, pp.138-140.

• Schütte, H. and Ciarlante, D., 2016. Consumer behaviour in Asia. Springer.

• Weinberg, B.D., Milne, G.R., Andonova, Y.G. and Hajjat, F.M., 2015. Internet of Things: Convenience vs. privacy and secrecy. Business Horizons, 58(6), pp.615-624.

• Hong, J.C., Lin, P.H. and Hsieh, P.C., 2017. The effect of consumer innovativeness on perceived value and continuance intention to use smartwatch. Computers in Human Behavior, 67, pp.264-272.

• Smith-Dektor, A.H. and Young, S.D., 2014. Marketing, technology, and medicine: recommendations on how to incorporate psychological principles into new technologies to promote healthy behaviors. Journal of consumer health on the Internet, 18(3), pp.253-259.

• Liang, Z., Ploderer, B. and Chapa-Martell, M.A., 2017, May. Is fitbit fit for sleep-tracking?: sources of measurement errors and proposed countermeasures. In Proceedings of the 11th EAI International Conference on Pervasive Computing Technologies for Healthcare (pp. 476-479). ACM.

• Lowens, B., Motti, V. and Caine, K., 2015, March. Design recommendations to improve the user interaction with wrist worn devices. In Pervasive Computing and Communication Workshops (PerCom Workshops), 2015 IEEE International Conference on (pp. 562-567). IEEE.