Fitbit is releasing less expensive activity trackers and a smartwatch, betting the lower prices will attract new customers, including more health plans.
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The company on Wednesday rolled out a Fitbit Versa Lite smartwatch at $159.95, roughly $40 less expensive than its main Versa product. Fitbit also said it will replace its existing fitness trackers with the Fitbit Inspire and Fitbit Inspire HR, which cost $69.95 and $99.95, respectively. Both are about $30 less than comparable older models.
Fitbit also redesigned its kids activity tracker. The new version, the Fitbit Ace 2, costs $69.95, $30 less than its predecessor.
The new products come as Fitbit tries to regain momentum. Its activity trackers sparked a craze of consumers logging their movement and trying to hit at least 10,000 steps per day. Yet Fitbit has found itself struggling to compete with the Apple Watch, a much more expensive but more versatile product than Fitbit’s original devices.
Fitbit said lowering the price of its new models will help it “capture unclaimed wrists.” The company also says lower prices will attract health plans that want to encourage members to become more active but don’t necessarily want to spend hundreds of dollars doing so.
The Centers for Disease Control and Prevention estimates 60 percent of U.S. adults have one chronic disease and 40 percent have two or more. Chronic diseases drive the country’s $3.3 trillion in annual health-care costs, according to the CDC. And some of these conditions, like diabetes and heart disease, are preventable through diet and exercise.
That’s where Fitbit and Apple think they can help. They’re pitching their devices to health insurers and employers as tools to motivate people to become more active and ultimately pursue healthier lifestyles.
Fitbit started selling the new Inspire and Inspire HR, short for heart rate, activity trackers in January to coincide with the new benefits year, said Amy McDonough, chief operating officer of Fitbit Health Solutions. Employers and plans typically subsidize trackers, though some pay for them altogether in exchange for people hitting goals.
Solera, a network that connects people with diabetes prevention programs, will give all of its members a Fitbit Inspire device, Fitbit announced Wednesday. People with pre-diabetes can delay or sometimes even prevent the onset of Type 2 diabetes through behavior and lifestyle change, like exercising more.
“In order to have a meaningful impact in health care, you’ve got to be able to do it at scale, which means it has to be affordable,” McDonough said.
Last year, Fitbit sold 13.9 million wearable devices, down 9 percent from the previous year. The company has invested more into its health-care business, including in acquiring a coaching platform called Twine. Fitbit in September introduced a new coaching program that integrates data from its devices.
This year, Fitbit expects its health solutions business to generate more than $100 million. The company posted $1.51 billion in revenue last year, down 6 percent from $1.62 billion in the previous year.
Shares of Fitbit have increased 15 percent over the past year.
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