On Tuesday March 13th Fitbit announced two new products: their second smartwatch, the Versa, as well as a child-focused fitness band, the Ace. Clients can view Strategy Analytics’ smartwatch outlook here and fitness band outlook here.
The Versa offers an improvement on the design of the Ionic, with curvier lines and a sleeker casing – an improvement over the sharp edges of the Ionic, and also very similar to the Apple Watch. It lacks a GPS, however, which is becoming a table stakes feature for outdoor workouts – one of smartwatches most popular use-cases currently.
Exhibit 1: Fitbit Versa
NFC for mobile payments is included in the European and Asian SKUs, though is only available for $30 extra in the Special Edition Versa in the US – a move that quite honestly feels a bit unfair and a bit of a slight to Fitbit’s core US audience. The price point, at US$199 retail, is meant to reach mass appeal and certainly is an improvement over the Ionic, which sells for $299 retail (though currently marked down to $269 retail). It is a more palatable price level for mainstream consumers and is also squarely aimed at both men and women, targeting the widest possible reach.
With the announcement of Versa also came the announcement of operating system update FitbitOS 2.0, which adds female health tracking, replying to messages from the wrist, and the Fitbit Dashboard – a glancable health tracking summary quickly accessible by swiping up on the watch face. Fitbit is leveraging assets acquired from Pebble to increase the number of apps and watch faces available to end users. We would caution, however, in the long run, that there may only be room for two major smartwatch OS players as has proven the case in smartphones.
The Fitbit Ace replicates the design language of the Fitbit Alta, though parred down with fewer tracking capabilities, a smaller wristband, and a lower price point of US$99 retail. It can be seen as a competitive response to other kids-focused models such as the Garmin Vivofit Jr and Vivofit Jr 2.
Exhibit 2: Fitbit Ace
Fitbit is looking to build out a more complete family of products ranging across adults and children, men and women, as well as smartwatches and fitness bands. We believe increasing the number of SKUs and product categories will not only increase volumes for Fitbit, but will also further expand the entire smartwatch segment in 2018 contributing further to the smartwatch-fitness band cannibalization trend.