Fitbit Exec Says Smartwatches Still ‘More Hype Than Reality’by
Fitbit first in wearable market sales, Apple is second
Company sold 4.4 million units in the second quarter
Even with a heavyweight like Apple Inc. in the market, smartwatches remain “more hype than reality" and have yet to prove they’re useful, said Fitbit Inc., the biggest maker of wearable devices.
“Consumers are still asking, ‘Why do I want one? Why do I need one?’" said Woody Scal, Fitbit’s chief revenue officer. Fitbit’s wearable fitness trackers still have an edge over the more complex devices because they have a longer battery life, cheaper price range and a more clearly defined audience, he said.
San Francisco-based Fitbit is aiming to maintain its dominant lead in the wearables market, where it sold about 4.4 million devices in the second quarter, according to an August report by market research firm IDC. Second-quarter revenue more than tripled to $400.4 million from a year earlier.
Competition is mounting, with China-based Xiaomi Corp., Jawbone Inc., and Samsung Electronics Co. vying for a piece of the action. Apple has beat analysts’ expectations for its watch, selling an estimated 3.6 million units, according to IDC’s report. Apple is holding a product event Wednesday where it will reveal a new version of its iPhone; the watch isn’t expected to play a major role at the session.
Fitbit users typically have clear goals in mind when buying a fitness tracker, Scal said. Though smartwatches also come with health-monitoring features, like step-counting, Scal said smartwatches’ short battery lives put them at a disadvantage to Fitbit’s products, which can go days without charge, meaning consumers can track their sleep overnight and monitor their heart rates around the clock.
Apple has said that its customers love the watch -- 97 percent were satisfied with the device and said it was improving their health and daily routines, according to a survey. "The feedback from Apple Watch customers is incredibly positive and we’ve been very happy with customer satisfaction and usage statistics," CEO Tim Cook said during a July conference call. Cook has said the Apple Watch is still in its infancy, in terms of applications and uses that will eventually be developed for it.
Since its June 17 initial public offering, Fitbit’s shares had gained 77 percent through Tuesday. Fitbit shares rose 3.1 percent to $36.54 at 10:43 a.m. in New York. Apple was little changed at $112.48.
Scal also touted Fitbit’s less-expensive prices, which range from about $60 to almost $250 for its newest product, the Surge, which comes with call and text message notifications. Apple’s watch starts at $349.