Otsikko

Otsikko

23 October 2013

Quo vadis, Sports Tracker ?

Sports Tracker application is like an old friend. I have used the fitness application from the time it came to market in 2005. I have no closer relationship with Sports Tracking Technologies, the company that is currently responsible for the business.

I was amazed when I read that a Sports Tracker competitor, Endomondo application (which I have also used), is used five times more when counting sport use kilometers. This aroused my curiosity. Are Sports Tracker really trailing Endomondo so badly? What factors have contributed to the development? What is Sports Tracker´s future and how could they improve the business? I did a little bit detective work. By using only public and free sources and tools, the picture became considerably clearer. This research trip is also a good example of how companies can analyse businesses and competitive situation, and thus develop more successful strategies.

Sports Tracker vs. Endomondo


Sports Tracking Technologies (hereinafter referred to simply as Sports Tracker) are a Finnish company with Nokia Corp. roots. A Nokia project launched the first version of the fitness application in May 2005. Endomondo are a good benchmark, because they are coming from another small European country, Denmark, where they were founded in November 2007. Apart from these two, a number of other competitors have emerged, such as Nomad, Skimble, Strava and Runtastic. They are not discussed in detail here.

Number of users


The Sports Tracker application has been used for 230 million sports kilometers, and the Endomondo one for about 1600 million. Various sports kilometers do not match, so this does not clarify the situation. If the number of users would be available that would help a lot. But only Endomondo have published the information that they have cumulatively 20 million registered users. AppAnnie give estimates on application downloads and they provide, inter alia, the following information:
  • In Apple App Store´s health and wellness category the free Endomondo application was in top five in eight countries and in top ten in 23 countries
  • Correspondingly, Sports Tracker were in top five in three countries and in top ten in 13 countries
  • In Google Play´s health and wellness category Sports Tracker were in top five in two countries (Endomondo in eight) and in top ten in six countries (Endomondo in eighteen)
Although AppAnnie do not evaluate Sports Tracker´s traditional area of ​​strength, Symbian, currently Endomondo seem to have a clear lead in download volumes.

Product features


We shall not make any product reviews or comparisons, they are already readily available from multiple sources. Instead, we shall first focus on expert views that are affecting potential customers and also on how users are seeing the two companies´ products.

In various expert reviews Endomondo would appear to get generally higher marks than Sports Tracker. The former have an extensive feature set and well-functioning web services, the latter have a praised mobile application. Sentiment analysis of user tweets is one way of measuring user perceptions, see also the picture below. Product usage experiences are likely to be the most important factor affecting the sentiment of messages. The companies´ products seems on a par till autumn 2011, after which Endomondo reputation is a little bit better.


Characteristics of company products do not explain differences in popularity, so we need to have a look at the reach of potential customers. The most important factor affecting it is the range of operating systems supported. Sports Tracker support extends to the following: Symbian, iOS (Apple), Android, and MeeGo (Nokia N9). Endomondo again support all the previous except Meego, plus they support also RIM (Blackberry). In addition, it is important to understand when the most important operating systems got the support, see the picture below. The picture also shows smartphone sales per Symbian, iOS and Android.


It is clear that Sports Tracker were too long stuck with Nokia and Symbian, and as a consequence, came too late on the tremendously crucial iOS and Android markets. It is difficult to assess whether this was due to not understanding the markets, long-standing links with Nokia, lack of resources or something else.

Marketing


Use of the Internet and social media have certainly been the key of both companies´ marketing efforts.

Google search statistics dramatically reveal how Sports Tracker have not been able to improve after the year 2009. Endomondo overtook them in the beginning of 2011 and have since then continuously been able to increase their attractiveness. The picture on the left shows also projected searches with dashed line. The number of searches correlates well with overall marketing efficiency and thereby also with interest in company's products.

Web service is an essential part of the overall service offering as perceived by a user. Company website is also an important part of digital marketing assets. Hubspot tool gives Sports Tracker website a score of 54 (scale 0 - 100) and Endomondo get a much better grade of 81. The main problems of Sports Tracker are blogging, mobile use of the website, lead generation and optimising pages for search engines.


Endomondo also have a clear advantage when measuring website visits, see the pictures on the left, Endomondo at the bottom. The pictures illustrate companies´ global ranking of website visits. Again, the Endomondo trend is positive, whereas the Sports Tracker position has not really improved over the years.

Popularity of company's websites is also greatly affected by the number of incoming links. The picture below shows that till the summer of 2011, the companies were equal; but after that, especially since summer 2012, Endomondo have improved much more. This can be partly explained by product features and partly by website attractiveness and success in content marketing.




Problems with Sports Tracker website content become also visible when looking at search results (SERP) of keywords that are important for fitness applications. The two companies occupy the top positions when searching the respective company names with Google. But for example, when searching  'GPS sports tracker', Sports Tracker occupy only the position 3, whereas Endomondo get positions 2, 4, and 5.  'Social Sports Computer' is the central Sports Tracker website tag line, but the positions are not better than 5 and 6.

The most worrying thing is that even when Sports Tracker are able to attract visitors to its website, these visitors do not find the pages interesting enough, see the Alexa picture below.


More than half of the visitors only visit one page, and others do not find a lot of compelling content.

Also in social media utilisation, Endomondo seem to be more skillful. For example, already in 2010 they were more popular than Sports Tracker in Twitter messages, and after that differences are even more remarkable, see the picture below. As regards to Twitter followers, the two companies are almost on a par: Sports Tracker are followed by almost 18000 and Endomondo by almost 21000 persons. This indicates that Sports Tracker still have, however, loyal core group of followers, which are constantly interested in their products.


Business Model


Product development and marketing are of course closely linked to the resources available. Resource availability, on the other hand, is greatly affected by the business model and especially revenue streams.

After Nokia years, Sports Tracker became an independent company in May 2009. The company's turnover in 2012 was 702 000 euros, it was making heavy losses and the equity was negative. The fitness application is downloadable free of charge, and there are no fees related to usage of supporting web service. The company seem to be receiving their income by selling heart rate measurement belts, iPhone bike mounting accessories, headware and socks. Long Nokia connection seems to have affected on the company mindset and implemented business models - when the company was a part of Nokia, the role of their service offering was mainly to support primary equipment business.

Endomondo have been able to take advantage of the emerging business opportunities. When Apple launched App Store in July 2008, and Google store opened in September 2008, they were able to rapidly grow their user base. Alongside the free application, a paid PRO version was launched in December 2010. App Store made it possible to make in-app purchases, i.e. to buy extra features for free apps, in August 2009, and Google Play store started to offer the same option in February 2011. Endomondo began to take advantage of these opportunities in 2011. The company also began to show advertising in connection with its applications and website services in September 2012. In addition, the company have partnered with another company to sell a variety of sports-related products. Endomondo revenues are already sufficient to cover operational costs.

Financing


In order to build operations and products as well as to acquire users, both companies have needed to seek external funding.

Sports Tracker financing was handled by Nokia for a long time, but after the establishment of the new company, they have been funded at least by Nokia-Technopolis Innovation Mill, Tekes and the City of Helsinki. Amounts of money have not been published.

Endomondo have received undisclosed amount of seed funding in December 2010, $ 800,000 in March 2011 and $ 2.3 million in September 2011. The company claim that they do not need any external money to continue operations.

It is noteworthy that Endomondo´s external funding has always been linked with company's reported product improvements, measurable improvements of market position and business model enhancements - see also the facts presented earlier. There is no detailed information available about Sports Tracker´s financing projects, but the presented facts tend to imply that attracting new money is much more challenging than in the case of their competitor.

Conclusions


Sports Tracker seem to have a lot of work to further develop their product and marketing as well as to improve the business model. It is most likely that unless the company is able to get external funding, it is not possible to make sufficient investments.

There are, however, substantial and growing markets for the company's expertise and products: fitness and well-being are increasingly important future trends. And the markets have certainly not been shared, yet. According to Alexa statistics, both Sports Tracker (below left) and Endomondo (right) site visits are dominated by small or medium-sized markets; it is still possible to significantly change competitive positions both on current target markets and on many of the biggest markets, not deeply penetrated today.



It is vital, however, that Sports Tracker are able to find again an agile way-of-working, where new emerging business opportunities are boldly and rapidly utilised. This will create constantly renewing competitive advantages upon which to build a successful business.

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