Stephanie Ma, Anirudh Ojha, Kelly Zdrowak, Hui Ting (Wendy) Wen, Michelle Zhou

New Product & Product Class Market The Fitbit Charge 2 launched August 29th, 2016 Product Description: Make every beat count with a fitness wristband built with PurePulse® heart rate, multi-sport modes, guided breathing sessions & interchangeable bands. Product Class: The Fitbit Charge 2 is in the product class “Fitness Trackers” Price: $150 (£130, AU$250) Geographic Region The Fitbit Charge 2 is sold all over the world.

Insights into the Competitive Dynamics Estimated Market Size: Whole Market : 78.1 million units (2015) Estimated Fitbit Market Share : 21 million units (27% market share) Estimated Fitbit Growth Rate : 13.1% Last quarter, Fitbit raised its full-year revenue guidance from 29%-34% growth to 34%-40% growth. That was encouraging, but it still represented a steep slowdown from 149% sales growth last year. Fitbit is also highly exposed to Brexit -- about 12% of Fitbit's sales come from Europe, and its most established market is the U.K. Fitbit expects non-GAAP gross margins between 48.5%-49% for 2016, which would be comparable to its gross margin of 48.5% in 2015. However, rising operating expenses are expected to weigh down its non-GAAP net earnings, which are anticipated to rise just 5% to 16%. Comparing that estimate to Fitbit's forward P/E of 10 suggests that the stock isn't significantly undervalued relative to its earnings growth potential. 2. Rising competition Between the first quarters of 2015 and 2016, Fitbit's share of the global wearables market fell from 32.6% to 24.5%, according to IDC.

EST. CURRENT MARKET SHARE Our Competitors... EST. CURRENT MARKET SHARE PRICE RANGE (USD) PRODUCT POSITIONING XIAOMI 12 million units (15.4% market share) $12.00-$25.00 Cheaper Alternative APPLE 11 million units (15% market share) $269.00-$1,300.00 Luxury GARMIN 3.3 million units (4.2% market share) $80.00-$250.00 Navigation JAWBONE (29.5% market share) $50.00-$250.00 Innovative Technology SAMSUNG 3.1 million units (3.9% market share) $170.00-$200.00 Customer Value

Substitute/Complements Subsititues: Smart Phones (e.g. Iphones, Samsung Note and Galaxy, etc.) Watches (e.g. Apple Watch, Samsung Gears, Jawbone’s UP, etc.) Heart Rate Monitor Complements Smart Phones (e.g. Iphones, Samsung Note and Galaxy, etc.) Computers (e.g. Macbooks, Sony, etc.)

All-In-One Fitness Wearables Distinctive Trends All-In-One Fitness Wearables Step 2 Step 3 Online Fitness New Home Cardio Option

Maslow’s Hierarchy of Needs Esteem The FitBit represents a lifestyle of high accomplishment and a specific social status with a trendy product. Leveraging their understanding of technology to create a sense of belonging. Purchasing a FitBit allows consumers to join a health and fitness community. Social

Major product attributes in the market Brand Compatibility Design Price Reliability Consumers’ perspectives and expectations of the different brands in the market has a huge impact on which brand is purchased. There are many smartphones brands on the market, but not all are compatible with the fitness trackers available. Sleek design, variety of colors, high durability and lightweight designs. Fitbit Charge 2 costs $149.95 while the Apple watch prices start at $269 or Samsung Fit2 costs $179.99. Features such as heart-rate monitoring, counting steps, and assessing sleeping patterns should be accurate.

Differentiating With Ads Ad displays main two features consumers have been asking for: PurePulse Technology The original Fitbit charge did not calculate heart rate correctly. Other competitors have similar issues as the original fitbit Spent years developing PurePulse technology to ensure accurate heart rate monitoring Larger Screen Other Fitbit models don’t have. One of the biggest complaints amongst consumers for other models Amazon Customer Review: Fitbit Charge HR Wireless Activity Wristband: “The product does not capture heart rate accurately, despite referencing their online user guide as instructed by customer service in order to ensure proper wear and usage.”

Evaluation of Fitbit Charge 2 The Fitbit Charge 2 offers a variety of new features and benefits for consumers. Fitbit Charge 2 connects to your phone so you can use it as a GPS while you are running or walking. Multi-sport tracking enables the band to be able to identify whether you are walking, running, or lifting weights for more accurate fitness recordings. Customize the color with interchangeable wrist bands. Other competitors have, but other Fitbit models don’t. Consumers prefer this benefit.

Future Trends in the Fitness Trackers Market Real-time tracking of what we eat Real time food consumption tracking Automatic calorie counting Focus on Physical Health Blood pressure monitor Oxygen level of blood Emotion and Stress Measure stress levels Analyze biosignals to measure emotions Ingestible Fitness Trackers Pill sized trackers ‘Smart Pill’ by Jawbone

References https://www.cnet.com/news/fitbit-still-tops-in-wearables-market/ http://www.idc.com/getdoc.jsp?containerId=prUS41284516 https://www.marketingweek.com/2016/02/17/why-fitbit-is-shifting-focus-from-fitness-to-fashion/ http://www.techradar.com/news/wearables/fitbit-charge-2-release-date-news-and-rumors-1324930 http://pocketnow.com/2016/08/30/amazon-fitbit-charge-2-flex-2-pre-order-deals https://www.amazon.com/Fitbit-Charge-Wireless-Activity-Wristband/product-reviews/B00N2BW2PK/ref=cm_cr_dp_qt_hist_one?ie=UTF8&filterByStar=one_star&reviewerType=avp_only_reviews&showViewpoints=0 http://time.com/4481100/fitbit-charge-2-review-2016/ http://www.wareable.com/health-and-wellbeing/future-of-tracking-health-fitness-happiness-2017 http://www.inquisitr.com/2492731/a-fitness-tracker-you-can-swallow-the-rise-of-smart-pills/ http://www.womenshealthmag.com/fitness/fitness-inventions http://gizmodo.com/fitbit-charge-2-is-the-best-fitness-tracker-period-1786720180 https://jawbone.com/store/fitness-trackers http://www.forbes.com/sites/jenniferhicks/2016/01/05/the-wearable-evolution-emotion-tracker-to-debut-at-ces-2016/#50a53d7a2e21 http://www.mensfitness.com/training/pro-tips/forecast-top-10-fitness-trends-2016 http://www.apple.com/shop/iphone/iphone-accessories/health-fitness?page=1&fh=35f7%2B47e1 https://9to5mac.com/2016/09/18/apple-watch-series-2-iphone-7-ads/ http://www.samsung.com/us/explore/gear-fit2/