What underpins a successful business? It’s the ability to create the right product at the right time and at the right price point. Get that formula right and you can’t fail to succeed, right?
So why do so many businesses fail to get off the ground or achieve any kind of longevity?
There are numerous factors that can influence the success of a business – from cash flow issues and unpredictable market changes to key staff leaving the company.
But when it comes to marketing, the biggest barrier for SMEs and start-ups isn’t necessarily the product or service – it’s the fact that no one knows it exists.
And if no one knows it exists, how can they expect anyone to buy it?
This is what happened to Eric Friedman and James Park, the founders of Fitbit – a fitness tracking device.
Back in 2007, Friedman and Park looked at advances in sensor and wireless technology and realised they could create a wearable product that would influence the way people get fit.
The entrepreneurs raised $400,000 to develop the first prototype and take it to market. Unsurprisingly their attempts failed: they may have had the right product, but with no brand equity and a rudimentary website they simply got lost in the noise.
It wasn’t until Christmas 2009 (after a number of close shaves) that they secured additional funding, which helped them build some traction within the market.
Today Fitbit owns 77% of the market and competes with major players like Nike. The Fitbit app is the number 1 downloaded fitness app in Apple’s App Store. And unlike blue chip competitors, who invested significantly in marketing, Fitbit spent less on marketing in two years than Nike did on one exhibition!
So how did Fitbit do it?
Aside from the obvious things like a great website, search engine visibility and a multidiscipline sales channel, Fitbit achieved traction by resisting the urge for expensive vanity marketing. Instead, they focused their spend on the elements that would deliver the most value.
- First of all, they nailed their proposition and differentiated themselves from other products on the market. In an article in Forbes, James Park said their main point of difference was their focus on the software not the hardware, unlike similar products from the likes of Garmin.
- Secondly, user feedback via social media and stockist websites provided third party endorsement and referrals. Fitbit appreciated the power of word-of-mouth marketing, knowing there is nothing more influential than friends and colleagues gushing about a product and describing how it changed their daily habits.
- But, in my opinion, the most powerful part of Fitbit’s offering is the community they developed. Fitbit has cleverly played on the fact that people are more motivated to exercise when they have a bit of peer support. Therefore, as a Fitbit user, you can compare yourself to others in your network, and are encouraged to get your friends to buy one too!
And it works: the Cognition case study
I speak from first-hand experience. I got a Fitbit for Christmas. I then encouraged my husband to get one so I had someone to compete with. Two colleagues at work then got one. And within three months the whole of Cognition is using Fitbit. What’s more – we’re all fiercely competing to see who can be the most active!
So what lesson can we learn from Fitbit’s success? You don’t have to pursue the flashiest, most expensive marketing channels to make a splash. The best results come from targeting the right channels while providing a great product, at the right time, at the right price point.
I just wish I had thought of it first – or at least negotiated a sales commission!
Want to learn more about How to Create a Successful Marketing Strategy?
Download our Free ebook today.