Digital Health: Fitness Trackers

In this article, we cover the landscape of devices used to track fitness and health parameters. In particular, we answer the following key questions:

• What are the different types of fitness trackers?

• How do these trackers differ in terms of key features?

• What are the different product / platform design approaches?

• What are the key emerging trends and growth drivers in this space?

Landscape of Fitness Trackers

Fitness Wearables are valued at ~$45B globally and are growing at ~$17% per year (GVR, 2022), of this US constitutes ~$25B (50-60%) (Fortune, 2024)

Fitness Trackers can be classified based on the use case and target market:

1. Smartwatches: Meant to combine smartphone and fitness tracking features into a watch for tech-savvy individuals eg. Apple Watch Series 9, Samsung Galaxy Watch 6

2. Sports Watches: "Rugged" watches meant to provide tracking features for fitness enthusiasts eg. Garmin Forerunner, Polar Vantage

3. Wristbands: Affordable devices designed for individuals seeking functional trackers with basic insights eg. Fitbit Charge 6

4. Ring Trackers: Geared for high-end users seeking minimalist designs. Used primarily for sleep monitoring and discrete health tracking eg. Oura Ring 4, Samsung Galaxy Ring

How do the Fitness Trackers differ in terms of features?

Basic fitness features: The top fitness trackers and wearables are broadly undifferentiated in terms of basic fitness tracking features. As shown below, they all provide basic distance / step counting, heart rate monitoring, sleep tracking and women's health tracking.

Advanced fitness features like ECG, sleep apnea tracking, and advance work out support are interesting but target a niche population and are not sufficient to drive mass adoption for a specific product.

Most brands try to differentiate themselves in terms of:

• Design features (Deep dive to follow)

• Integration with a broader ecosystem (eg. Apple, Fitbit (Google), or Samsung)

• Affiliation with influencers (eg. Oura, Garmin)

Product / Platform Design Approaches

Different companies use 3 approaches to define their product positioning in line with their target market: Minimalist, Basic Personalized, and Advanced personalized.

Basic Minimalist Approach: These wearables primarily focus user experience around a single key metric. Although they do track a range of parameters and allow personalization and integration with a broader ecosystem, these are not the focus of the product design. Prime examples of this include Apple's Exercise Rings and Oura's Readiness Score. They reduce multiple fitness metrics or fitness goals into one intuitive goal/slider which makes the interface clean and less clunky. This is ideal for beginners. 

Basic Personalized Approach: These wearables allow users to decide which metrics, goals and activities are important for them. The idea is to provide the user with a clean and intuitive interface which tracks these activities, educates the user on their importance and allows basic integration with tech platforms (eg. maps to track route completion) and external coaching services (eg. workout support). A good example of this is Google's Fitbit app, which was massively simplified in 2023. This is ideal for casual fitness enthusiasts who are new to fitness tracking. 

Advanced Minimalist Approach: These wearables focus on providing their users with advanced and in-depth analytics on health parameters however they simplify the initial user journey by concentrating on select high-value metrics. A good example of this approach is the WHOOP which has created a comprehensive dashboard of Sleep, Recovery and Strain scores to guide the user on lifestyle changes while avoiding any distracting features (eg. WHOOP avoided step count for the longest time and continues to avoid any digital watch faces). This is ideal for athletes and fitness buffs who want clarity and visibility on priority performance metrics but want to avoid the quantitative nitty-gritty of what different metrics do. 

Advanced Personalized Approach: These wearables are differentiated by both the depth and the breadth of health metrics they provide. This can often be difficult to manage as it risks overwhelming the users with excess data and cluttered dashboards that they'll never use. A good example of a company which has followed this approach is Garmin. Garmin's Connect has a longer onboarding journey with a 'Quick Start Guide' and offers both 'At a Glance' and 'In Focus' dashboards for the prioritized metrics. This is ideal for fitness trainers, athletes and data-savvy fitness enthusiasts who seek autonomy on their prioritized goals and in-depth insights on the selected metrics. 

Key Emerging Trends and Growth Drivers

1. Demand Drivers:

   1. Personalized Health Monitoring: ~50% of users have purchased a fitness wearable at some point in their lives and ~33% claimed to have increased use of wearables vs last year and ~75% expressed interest in using wearables at some point in their lives (McKinsey, 2024)

   2. Gamification of fitness: Fitbit's gamification approach resulted in 111M users as of 2021 and motivated 89% of users to exercise (StriveCloud, 2021). Adoption of Fitbit leaderboards resulted in an average daily increase of 3.5% increase in users' physical activity (steps). For previously sedentary users this was as high as 15% (NIH, 2023)

   3. Focus on women's health: Women are 2.3x more likely to use a fitness tracker (NCBI, 2022). In particular, this can ensure timely diagnosis of PCOS and infertility (Omnia Health, 2024)

   4. Corporate Wellness Programs: Comprehensive employee wellness programs can yield ROI as high as 6:1. J&J's wellness programs saved the company ~$250M in healthcare costs between 1995-2010 (HBR, 2010). However, cost savings might be limited due to lower participation from older populations or populations with higher health spend (Illinois Work Place Study, 2019)

2. Supply Drivers:

   1. Government initiatives:

      1. US government is testing "Wearables Pilot Program" during military exercizes to monitor troop's physiological data (US Army Pacific, 2023)

      2. UK government has set a target of ~30% adults actively participating in wearable device-enabled public health intervention by 2027 (Tony Blair Institute, 2022)

      3. Indian government launched "Ayushman Bharat Digital Health Mission" (ABDM) in 2021 to invest $650M to enhance digital health infrastructure (Pharmiweb, 2024)

   2. AI-backed insights: Whoop, Garmin and other wearables offer AI-based coaching to individuals based on health parameters (Appinventiv, 2024). AI model integration can yield up to 23.8% improvement in health prediction performance (Andrew Bolwell, 2024)