Questions: Q.1) Analyse the forces which are driving industry competition using Porter Model for FITBIT case study. ( 10 marks ) Q.2) Conduct the SWOT analysis for FITBIT. ( 16 marks ) Q. 3) Evaluate...

FITBIT ANALYSIS REPORT 1
FITBIT Analysis Report
FITBIT ANALYSIS REPORT 2
Contents
Introduction.....................................................................................................................3
Porter five forces
model...............................................................................................................................3
SWOT Analysis...............................................................................................................5
PESTLE Analysis...........................................................................................................10
FITBIT differentiation
strategy............................................................................................................................12
FITBIT positioning
strategy.............................................................................................................................12
FITBIT overall
strategy..............................................................................................................................12
Conclusion.........................................................................................................................13
References......................................................................................................................... 14
FITBIT ANALYSIS REPORT 3
Introduction
The report aims to analyse the FITBIT that is a global company (McNew,2015) and
its strategic initiatives in terms of achievements of vision and mission. Along with this, it
provides SWOT analysis of company, PESTLE analysis, porter five forces analysis,
differentiation strategy and positioning strategy against the competitors. It concludes with the
suggestions for the company.
Q1. Analyse the forces which are driving industry competition using Porter
Model for FITBIT case study.
Porter five forces model
Threat of new entry
Though the FITBIT has created high barriers for new entry but the recognizable
brands with big business such as Apple and Samsung enter into the wearable device market
and this suggests that threat of new entry from the well established brands in this sector is
high. There is good growth in the wearable device segment and this will attract more
companies to enter into this segment further intensifying competition. There are companies
such as Pebble to Nike that are working in this sector. The study of ABI research (2013)
reveals that there is good growth in the wearable technologies.
Threat of substitute products
The threat from the substitute is high. There are many companies entering into this
segment and similar products availability will be on the rise. There are factors such as rules
and regulations, technology limits, battery technology constraints, acceptable weights for the
products and bulk of wearable equipments that may play role in intensifying the threat of
substitute products.
FITBIT ANALYSIS REPORT 4
Bargaining power of buyers
The bargaining power of buyers till now is not high due to low alternatives
availability and cost factor. The cost of the FITBIT products are comparatively low than
Apple and other brands and preferences of customers to purchase the products of FITBIT
offers it a great bargaining power over the customers. But this situation may not be
favourable with the availability of new alternatives. This is evident from the declining market
share of FITBIT. Though it is pioneer in this field, still the low awareness about its brand
may pose a threat and bargaining power of buyers may be tilted towards them. There are
many challenges such as the fashion uniqueness, specialization, mass adoption challenge, and
other factors that are not working in the favour of buyers and this will only increase towards
buyer favour in future. Therefore FITBIT has to find new ways to allure buyers to purchase
the products regularly. Only one factor that works for company favour is the high switching
cost that may prevent customers to choose a new company.
Bargaining power of suppliers
The bargaining power of suppliers is high but it is gradually decreasing. With more
companies in the market, there will be more suppliers and more alternatives thus the
bargaining power of suppliers will be lessened. This is evident by the industry growth and
entry of new companies in this segment. FITBIT is not dependent upon the suppliers but as it
is market leader it has certain bargaining advantages and suppliers may not practice such a
business activity that may benefit more to them than FITBIT. Its less dependency over the
FITBIT ANALYSIS REPORT 5
suppliers to chose and suppliers intentions to sell in bulk makes low bargaining power of
supplier.
Rivalry among competitors
The competition is intense in this sector. The new companies are coming into this
sector due to high growth and they are making their presence felt. This is quite evident by the
presence of Apple that has carved out a market share of 21 percent. One factor that is
working for the company to have an edge over competitors is the high switching cost for
customers that may prevent customers to opt for new companies services.
Q2. Conduct the SWOT analysis for FITBIT.
SWOT analysis of FITBIT
Strengths
The strengths are generally the advantages over the competitors. For determining
strengths; qualities, expertise, resources, competitive advantages are considered here.
Good financial condition
Company has good financial standing. Investors are interested to invest in company
because they think that there is great potential as well as promising future. Company has
market share of 68 percent in fitness tracker market. There is continuous growth in revenue
since 2011. FITBIT Flex is known as the best selling wrist worn devices along with Charge
HR sold by Best BUY, Amazon, Wal-Mart and Target.
Different range of products
FITBIT ANALYSIS REPORT 6
Company has offered products for different...