Fitbit has pulled its trackers out of practically 30 nations or territories, based mostly on a choice from mum or dad firm Google to “align” Fitbit and Pixel gross sales extra carefully. An business skilled informed me this was a “prudent” resolution on Google’s half. However it nonetheless has me apprehensive that Google has no plan for Fitbit past its traditional conservative gross sales M.O.
Sunday Runday
In his weekly column, our Senior Editor of Wearables and Health Michael Hicks discusses the world of smartwatches, apps, and health tech associated to working and well being, in his quest to get quicker and more healthy (and show you how to do the identical).
Fitbit first reduce its gadgets from 5 APAC nations again in August, then 11 European nations on October 24, and eventually Mexico, Puerto Rico, and 10 Latin American nations at an unspecified (however latest) time. Extra a shamed whisper than an announcement, this information wasn’t broadly identified till 9to5Google noticed the help web page on Thursday.
Google’s reluctance to develop Pixel gross sales out of some nations or to maintain particular merchandise from nations is infamous. Our Senior Asia Editor, Harish Jonnalagadda, has written at size about Google’s {hardware} errors in India, for example, and Google additionally pissed off foldable followers by limiting the Pixel Fold to a handful of nations.
Basic Pixel availability has expanded — the Pixel 5 bought in lower than 10 nations, whereas the Pixel 8 is present in 17 nations — nevertheless it’s nonetheless very sluggish and methodical in comparison with Samsung or Apple. With Google apps turning into a significant function of Fitbit merchandise, it is smart that Google would not wish to waste assets promoting merchandise the place it has no foothold.
Nonetheless, simply because one thing is smart does not imply it is the proper resolution.
The place is Fitbit nonetheless accessible?
In an announcement to Android Authority, Google defined that they “will cease promoting Fitbit merchandise in choose nations to align our {hardware} portfolio to map nearer to Pixel’s regional availability.” So, the place can you continue to purchase new Fitbits?
That is the present record:
- North America: Canada, United States
- Europe: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Eire, Italy, The Netherlands, Norway, Spain, Sweden, Switzerland
- Asia & Pacific: Australia, India, Japan, New Zealand, Singapore, Taiwan
That is the record of former Fitbit nations with no new {hardware} gross sales transferring ahead:
- Americas: Argentina, Chile, Colombia, Costa Rica, Ecuador, Guatemala, Mexico, Panama, Paraguay, Peru, Puerto Rico, Venezuela
- Europe: Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Luxembourg, Poland, Portugal, Romania, Slovakia
- Asia & Pacific: Hong Kong, Korea, Malaysia, Phillipines, Thailand
Google and Fitbit have promised to proceed software program help, guarantee claims, and customer support in these nations, however just for older Fitbits, not newer trackers just like the Fitbit Cost 6. Fitbit Premium auto-renewals additionally ended, although you’ll be able to manually “resubscribe to Premium within the Fitbit cellular app,” not less than for now.
Why chopping Fitbit’s world availability is smart
I requested Jitesh Ubrani, analysis supervisor for IDC’s Worldwide Cellular Machine Trackers, if Google made the correct or unsuitable resolution to tug Fitbit out of its conventional markets. He responded that “it is not about Google doing proper or unsuitable; it is about Google being prudent.”
As Ubrani defined, within the rising markets Fitbit fled, Fitbit’s market share “was fairly low and trending downwards.” Why? As a result of customers both gravitate in the direction of “world manufacturers akin to Apple and Samsung” or “low-cost, value-oriented manufacturers akin to Xiaomi, Amazfit, or Huawei.”
“Fitbit has been unable to ascertain itself on the excessive finish because it solely provided wearables…on the low finish, it confronted an excessive amount of competitors on worth from the Chinese language manufacturers.”
Xiaomi and Amazfit, kings of low cost however high-quality health trackers, technically profit from Google’s resolution, however Ubrani believes their positive factors can be “minimal” as a result of Fitbit’s new shipments had been “lower than 1% share of smartwatches + wristbands” in a few of the affected territories.
On this context, it appears completely legitimate that Google, having spent $2.1 billion on Fitbit, would reduce its losses in markets the place it is unlikely ever to recoup its funding. It is going to nonetheless help present Fitbit prospects to keep away from dangerous blood, within the unlikely occasion it ever decides to return to those secondary markets.
Google missed a possibility to kill two birds with one stone
Fitbit has fallen from its gross sales glory days. Counterpoint’s 2022 wearable report discovered Fitbit dropping from Seventh-ranked in world gross sales in 2021 to tenth in 2022. However to be clear, Counterpoint attributed this particularly to Fitbit and Google “failing to defend their share of their major markets like North America” (emphasis mine).
Google’s tenure as Fitbit proprietor has been outlined by the phrase “no.” No extra Google Assistant, no extra third-party apps, no extra Fitbit accounts, no extra Wi-Fi downloads, and so forth. It is the definition of “my means or the freeway.”
Fitbit Sense 2 and Versa 4 gross sales suffered from this method. I am unsure how the Cost 6 will promote, however I had one main Google-related annoyance in my assessment: the insistence that it solely helps YouTube Music playback controls when any low cost health tracker normally has common playback controls.
In different phrases, Google and Fitbit have larger issues than simply being overextended. A lot in order that they did not see Fitbit’s widespread identify recognition as the chance it was, and shortly reduce their losses.
Ubrani’s level that Fitbit won’t ever compete as a price model towards $50 Amazfit trackers makes whole sense. But when Fitbit could not “set up itself on the excessive finish because it solely provided wearables,” the answer was apparent: use Fitbit as your foot within the door to develop Pixels to extra nations.
They might have trusted the improbable Pixel 8 to attain recognition whereas suggesting that Fitbits are “Greatest with Pixel” and tying its health wagon to an thrilling new {hardware} choice. They might even have bought the cellphone with a free Fitbit tracker as a pre-order perk.
Perhaps I am naive, and Google execs might clarify why it is unimaginable to promote Fitbits or Pixels in Mexico, Poland, and dozens of different spurned nations. However what I do know is that Google’s conservative monetary technique will persuade individuals there that Google would not see them as well worth the effort, and so they’ll bear in mind.
Let’s hope the top is not nigh
Calling Google’s resolution a “portent of doom” would possibly sound a bit dramatic. However it’s dramatic to slice your subbrand’s nations in half, and Google’s status for chopping its losses and killing manufacturers is well-known.
I can image a worst-case situation the place Google grows uninterested in Fitbit’s struggles with out addressing the trigger, shoves its helpful tech into its Pixel lineup, and lets Fitbit die. Or maybe Google will begin promoting Fitbits as Pixel Bands or Pixel Watch Lites, with the flagship Pixel Watch 2 snagging all the most effective options.
Taking this path would possibly make followers of Android smartwatches blissful, however it might rub many Fitbit customers the unsuitable means — particularly since Fitbit is standard with iOS customers, and the Pixel identify implies Android exclusivity.
A few months again, I wrote about three potential paths Fitbit would possibly take within the close to future:
- Problem Apple Health Plus with extra exercises, licensed music, and different flashy perks.
- Problem Garmin by making the Day by day Readiness Rating extra helpful for recommending particular health routines based mostly in your health degree
- Go all-in on Google apps.
As I stated then, the final choice “appears to be the trail Google and Fitbit have chosen,” and this newest information about Google limiting Fitbit solely reaffirms that perception. Google spent $2.1 billion on Fitbit for what it was, having no plans for the place it ought to transcend shoving lots of Google tech inside.
I want, as a substitute, that Google would unleash Fitbit’s full potential by investing in it after which letting it run unfastened, giving prospects the concept that they’re getting premium options in reasonably priced {hardware} with out Large Tech meddling.
However as we have seen in numerous enterprise acquisitions, issues hardly ever work out that neatly for the businesses which can be purchased.
