Fitness trackers aren't selling well this holiday season, and smartwatches may be faring even worse. Desperation in the wearable-tech niche is making the leaders hungry for one another's business. We saw Fitbit (NYSE:FIT) make a play for the Apple Watch market with the rollout earlier this year of Blaze, Fitbit's first smartwatch. Now we're seeing Apple (NASDAQ:AAPL) gun for the corporate wellness market, where Fitbit was starting to shine, with the consumer market drying up.
Apple has rolled out a page on its website promoting Apple Watch as a tool for corporate wellness programs.
"Apple Watch is designed to work seamlessly with your corporate wellness program so employees stay active, healthy, and productive throughout the day," explains Apple's site.
The page points out how Apple Watch works with many existing corporate wellness tools as apps, and there's also an endorsement from the human-resources chief at Aetna, an early adopter in subsidizing wearable tech for its employees to encourage more active lifestyles. It's "game on" in the push to become the top brand in corporate wellness from the two companies selling millions of high-tech wrist-huggers.
Fitbit has been able to nab some juicy corporate customers, as companies realize that keeping their employees active lower their health-coverage tabs. Earlier this year, Fitbit singled out a Springbuk study, showing how employees who opted into the Fitbit wellness program incurred $1,300 less per hire in annual healthcare costs.
Last month's earnings call offered plenty of color on Fitbit's efforts paying off, including recent corporate wellness wins at Pitney Bowes and Dr Pepper/Snapple Group. It also pointed out how Virgin Pulse -- a wellness tech platform with 2,200 corporate accounts and one of the three apps singled out in Apple's new corporate marketing pitch -- will endorse Fitbit as its tracker of choice.
There's obviously plenty of room for more than one winner here. Things just feel desperate because of how hungry for growth both companies are these days. Fitbit's targeting just 2% to 5% year-over-year revenue growth for the current quarter. Apple doesn't break out Apple Watch sales, but the "other products" category on its summary page that includes its nascent smartwatch efforts but also its fading iPod line experienced a 22% slide in its latest quarter.
Apple's corporate wellness push makes sense, but it will have to deal with its substantially higher price points relative to Fitbit's wares. It's not an insignificant cost or issue for companies trying to maximize the well-being of their workforce. In that sense, Apple's push may actually pay off for Fitbit. Apple can make fitness tracking at the corporate level cool, driving demand for all of the players.
Fitbit may fear Apple the conqueror, but it can only benefit from Apple the educator.
Rick Munarriz owns shares of Apple and Fitbit. The Motley Fool owns shares of and recommends Apple and Fitbit. The Motley Fool has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.