A Definition of a Competitive Advantage
An essential task that has to be completed by any given organization in order to remain successful is to find opportunities to make its operations sustainable and compete aggressively. This shows that competitive advantage is a benefit that makes the company relevant for consumers and allows the organization to outrun rivals by generating products and services that justify higher prices (Conick, 2017). One of the reasons why competitive advantages have to be identified is the need to maintain cost leadership and exploit the economy to enable new ways of minimizing costs while not compromising the quality of products and services. In line with Lewnes and Keller (2019), this approach to competitive advantages is acceptable for plenty of customers because it promotes low-cost products. For the organization, on the other hand, it creates room for higher capacity utilization and improved productivity (Elman, 2018). Today’s businesses tend to look into effective distribution channels and proper use of technology.
Another way to define a competitive advantage would be to link it to the differentiation focus and leadership and see how the company could appeal to various market segments. When approaching a broad group of consumers, an organization should be careful enough to ensure that all the wants and needs are addressed vividly and with peculiar attention to detail (Baalbaki, Hoffman and Gilliard, 2017). The value will be added, and prices are going to go up without the company having to alter its pricing strategy. Overall, expertise in this area could help businesses approach their strategies from a point where competitive advantages are a result of following various criteria that are important for different consumer segments (Muminova, 2019). As noted by Conick (2017), the role of customer recognition and superior product quality cannot be overlooked due to the need to remain consistent with economies of scale and the willingness to achieve clear brand loyalty.
Competitive Advantages of FitBit: Porter’s Five Forces Analysis
Objectives
Any given marketing objective should be focused on how the company is going to launch new products and support its existing operations. In accordance with Millington (2016), it is crucial to conduct detailed reviews of available marketing options prior to deploying strategies. It would help the organisation unlock specific promotional tools, extend the distribution network, and create room for novel advertising instruments (Baalbaki, Hoffman and Gilliard, 2017). For FitBit, one of the key areas to pay attention to is brand awareness, as more customers would obtain its products and improve the company’s image.
The following is the list of objectives that the new marketing plan requires the team to complete in an attempt to improve the state of affairs:
- The local market should be extended with the help of a renewed distribution network so as to give FitBit management an opportunity to upsurge the obtainability of the given products. In line with Pinto and Yagnik’s (2017) ideas, distribution channels and stock maintenance will help FitBit cover consumer wants and needs without putting a strain on the company’s budget.
- New advertisement tools should be implemented in order to make FitBit’s promotional campaigns stronger and affect the overall brand awareness among consumers.
- After the release of new products, the team should conduct online surveys to collect all kinds of feedback and see if any improvements could be introduced to follow up on the initial impact.
- Additional services should come with the product release and sales if FitBit expects to set the focus on customer satisfaction and reinforce the idea that monetary resources do not represent the ultimate objective to be attained by the team.
- Over the next 12 months after the product release, FitBit would have to achieve higher sales and maintain the same level of market activity to make sure that there is no competition.
A Preliminary SWOT Analysis
Target Market
After the review of the SWOT analysis, it can be suggested that FitBit should target different groups of individuals that require a variety of products. Consumer demands and needs are worth detailed attention because of the existence of picky buyers who would test the products against a series of challenges prior to deciding on whether they are going to purchase them (Elman, 2018). Therefore, the target market for FitBit is going to be individuals who associate themselves with fitness and related activities. From motivation to vital information, FitBit products should be a source of various insights that would leave the majority of the target population impressed with the quality of the company’s products. Nevertheless, further extension of the target population could be possible under the condition that students and people with health issues could be added to the list of potential FitBit consumers. Irrespective of the intended activities, people will get a chance to monitor themselves and make the best use of devices proposed by FitBit and not Apple, Nike, or Xiaomi.
Product Strategy
The product strategy for FitBit’s marketing efforts will depend on the contents of the BCG matrix. A detailed analysis of the existing evidence resulted in the following matrix:
Pricing Strategy
Nowadays, FitBit is a multi-million-dollar company that has the opportunity to influence the fitness world through the interface of its products. As per Yun et al. (2020), the overall growth over the past ten years is close to $1.9 billion, making it safe to say that FitBit is one of the fastest-growing companies in its sector. In order to capitalize on this progress, the management will be required to revise the pricing strategy and come up with estimates that would leave all consumers contented and create enough rivalry for alternatives from Apple and Xiaomi. Fitness watches are extremely popular nowadays, which means that practically no compromises are to be made when setting the right price for the majority of FitBit’s products. There will be more products released during every other fiscal year that would come with exciting features. The core proposal within the framework of this marketing plan is to focus on low-cost and premium options in order to create two definite market mixes for both target groups of consumers. Such price positioning is going to help the company stay in the market for a much longer period.
Promotion Strategy
For the promotion of the respective products, FitBit should be as active as possible across all the available social media websites and applications. Even though conventional approaches to advertising are still somewhat relevant, the key focus is on the populations that spend most of their free time navigating smartphones and tablets (Huang and Rust, 2021). This particular factor shows how the company could benefit from promoting the brand online and connecting with existing and potential consumers online. Using both direct and indirect communication, FitBit will share all the relevant product information with the most active users. Twitter, Facebook, and Instagram should be considered the foundation of the company’s promotion strategy since most of the messages would be sent via these social media networks. There are numerous examples from other famous sports and fitness companies where those uploaded pictures and short clips that pitched the products to the target audience (Millington, 2016). It would be reasonable to purchase several billboards within the most crowded areas in order to create a visually appealing message in real life and pair it with a strong slogan.
Target Location
Over the course of the next 12 months, the team will have to focus its efforts on the creation of a customized online marketplace where all kinds of consumers would have a chance to find a FitBit product that appeals to them. In addition to being a much easier way of shopping, this would also limit consumers’ exposure to the consequences of the Covid-19 pandemic. From the comfort of their homes, customers will gain insight into available products and their detailed specifications, with an opportunity to order products they wish directly to their door. Nevertheless, the classical shopping method will not be ditched, as retail outlet distribution will become the key to popularising major FitBit shops among existing and potential customers. Therefore, there is no difference between online and offline stores in the case where FitBit’s distribution network is strong enough to cover all the expenses and challenges.
Monitoring the Outcomes
Proper monitoring efforts will have to be implemented in order to direct the launch of new products and help FitBit management maintain the new marketing strategy and all promotional campaigns included in it. Throughout the first six months after the launch of new products, the team will have to make sure that brand awareness remains one of the key priorities for the organization. Product sales will be tracked as well, creating room for reasonable innovation in the area of free services, unique discounts, and other ways of appealing to different target consumer groups. Estimated sales will then be checked against the actual numbers to help the management reach a decent conclusion regarding the effectiveness of the new marketing strategy. The team will be responsible for generating graphs that show the company’s position in the market and its projected growth. The pricing strategies will be monitored to provide the management with an idea of how the marketing strategy could be revised to attract more consumers. As a result, the key weaknesses of the existing approach are going to be delineated, causing the team to regroup and adjust to customer demand.
Key Takeaways
Based on the information that was obtained within the course of this case study, it can be concluded that the efficiency of FitBit’s operation will depend on how the company will position its new products. Even though a similar conclusion could be associated with the majority of businesses similar to FitBit, the existing marketing plan is going to benefit the organization because of being well-planned and detailed enough. Specific points were covered in rich detail in order to validate the need to monitor the outcomes of implementing a new marketing plan. The existence of competitors (e.g., Xiaomi, Apple) makes it easier for FitBit to come up with the most reasonable solutions and ensure that its activities are feasible enough to be considered effective. The potential marketing mix will be revised on the fly to create enough space for the company in terms of how it appeals to consumers and draws their attention to FitBit products. It was the SWOT analysis that helped the author define the best options for the new product launch operations and forecasting.
In the future, the management of FitBit will have to review the life cycle of its products to ensure that each of the items appeals to at least one category of buyers. This is why the monitoring process is so crucial, especially with marketing initiatives requiring the team to introduce changes constantly. The dynamics of the market will serve as both an opportunity and an advantage for FitBit since the company recognises its market power. With every new product, FitBit will have to go through similar operations and carry the same messages, paving the way for much more detailed strategies and an increased capability of adhering to consumer preferences. Market demand alterations could affect the company’s strategy but only to an extent where the management of FitBit would have to develop and launch new products. Overall, a lower pricing strategy and a variety of means of communication will take FitBit closer to becoming a monopoly and outrunning serious competitors.
Reference List
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Elman, J. P. (2018) ‘“Find Your Fit”: wearable technology and the cultural politics of disability’, New Media & Society, 20(10), pp. 3760-3777.
Huang, M. H. and Rust, R. T. (2021) ‘A strategic framework for artificial intelligence in marketing’, Journal of the Academy of Marketing Science, 49(1), pp. 30-50.
Lewnes, A. and Keller, K. L. (2019) ‘10 principles of modern marketing’, MIT Sloan Management Review, 60(3), pp. 1-10.
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Muminova, G. B. (2019) ‘The innovative marketing applications and online consumer behavior’, Amazonia Investiga, 8(20), pp. 388-394.
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