The Information has reported that fitness tracker business Jawbone is finally going out of business after months of conjecture. The story, which has been confirmed by The Verge, will come as a surprise to users, but not to anyone who has been following the company, or is involved with the industry at any level.
Jawbone’s future has been uncertain for more than a year, and every time it seemed to be rising from the ashes, the business will experience another setback. Sadly, most of the setbacks have been self-inflicted. Customer service issues, quality concerns and – most notably – the failure to pay suppliers have been just a few of the problems faced by the business over the last 14 months. Analysts have been brutal on the business, with BlackRock marking down its stock to less than a cent on the back of concerns Jawbone’s debt was unserviceable. Now, after the advent of (ongoing) litigation with rival Fitbit resulted in key executive departures and a slump in consumer confidence, chief executive and co-founder Hosain Rahman has leapt off the sinking ship, and founded a new business in the health sector. His business is still using the Jawbone name – something we will no doubt hear more about over the next weeks and months.
The major mistake however, came when the business, originally a creator of some of the most innovative Bluetooth speakers and headsets on the market, decided to bet everything on fitness tracking devices. Jawbone’s original speaker products were incredibly well received both by consumers and wholesalers, who love the edgy design, combined with cutting-edge technology. The advent of fitness tracker technology was no doubt seductive, especially because fitness trackers are relatively cheap to make on a large-scale, and have an extraordinarily high margin…or at least they used to. With numerous competitors entering what was seen to be a growth market, and Fitbit claiming the lead position with a far more adaptable and intuitive product, Jawbone was left in the awkward position of being middle-market and competing with lower quality, incredibly cheap options. The opportunity was there to re-broaden the product line and focus more on mobile and Bluetooth technology, rather than exclusively driving wearable tech but it seems that the sale had already been made to the board and investors that high margin wearable consumables were the way of the future.
Then, everyone was making wearable tech. Apple, Samsung and other businesses with significant resources piled them into their own fitness trackers that also have the ability to do…pretty much everything. Suddenly, wearing your fitness tracker wasn’t so much a badge of honour, as it was an admission you couldn’t afford an Apple Watch.
Jawbone will no doubt go down in technology history is an example of mismanagement and a lack of commercial awareness, but that doesn’t do justice to the fact that the critical error was made at the start. As Ryan Holiday says in his excellent book, Growth Hacking, “You know what the single worst marketing decision you can make is? Starting with a product nobody wants, or nobody needs.”
That, as it ends up, was Jawbone.

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