In the wake of Garmin Ltd. (NASDAQ:GRMN) launching Vivosmart3, its newest fitness wearable, analysts have said that Fitbit Inc (NYSE:FIT) has no cause for worry right now. This is despite the fact that the Vivosmart costs $140 compared to Fitbit’s Alta HR which costs $150. While the lower price has allowed Garmin to grab a decent market share, it hasn’t been a breakout success though.
In 2016’s fourth quarter when aggressive holiday promotions were being run, Fitbit managed to stay ahead of the pack by winning 19.2% of the market across the world. Year-over-year shipments, however, fell by 22.7%, according to data provided by the IDC – International Data Corporation.
Record-high shipments
Though there had been a lot of skepticism concerning the growth of fitness trackers, the market saw growth with shipments rising 16.9% compared to the previous year and reaching a record number of units shipped. Though the market in Europe and the United States is considered relatively mature, room for growth exists in Asia. But in order for more growth to be experienced, the fitness tracker segment needs products with new features in order to pull in new users.
With Garmin, the GPS running watches have proved to be popular with those who are highly fitness-focused.
“Garmin’s really dominant. If you look at who’s buying those types of watches, they tend to be more extreme athletes, very outdoorsy,” said an analyst at Dougherty and Company LLC, Charlie Anderson.
Defining features
Some of the features in the Vivosmart 3 that threatens the dominance of Fitbit’s Alta HR includes a functionality that allows for heart-rate tracking and VO2 max which lets users calculate a ‘fitness age’ as determined by their aerobic performance. Previously, the VO2 max was only available in the high-end smartwatches of Garmin.
There are also other defining features in the Vivosmart 3 such as a stress-tracking functionality and a measuring tool for strength training activities. Vivosmart 3 is, however, lacking the GPS feature but this is likely to be included in an upmarket iteration.
On Monday shares of Garmin Ltd edged up by 0.60% to close the day at $48.98.
