Read time: 5 minutes

Good morning! It's Tuesday, December 19th. Today we are looking at Whoop’s fitness tracker and how it not only survived competitors like Apple and Nike but outcompeted them!

THE FEATURE

Whoop: The $3.6B Fitness Tech Marvel That Outpaces Apple and Nike

When the Apple Watch launched in 2015, it quickly became the best-selling wearable device and fitness tracker. With everything from heart rate monitoring to smartphone compatibility, many believed Apple cornered the market they just entered. 

However, there are now plenty of viable competitors to Apple in the wearable fitness market. The most successful competitor is Whoop, a fitness tech company with a $3.6B valuation!

So, What's the Business?

Will Ahmed founded Whoop in 2012 after becoming obsessed with the science of fitness and recovery while playing squash for Harvard. Together with his college friends, who specialized in engineering and computer science, they developed a prototype for an advanced wearable fitness tracker. 

Today, that fitness tracker is worn by celebrities ranging from podcasting legend Joe Rogan to athletes like Lebron James. 

What makes Whoop different from the rest of the fitness wearable industry is that it truly has the best product in the space and can charge a premium for it. In 2016, they sold their wearables for $500 a piece. However, upon seeing a low churn rate, they shifted to a subscription model:

•  $30/month

• $239/year

• $399/2 years

The Whoop strap is included in the subscription cost, but if a user doesn’t pay membership fees, the fitness tracker becomes inactive and can’t upload stored health data analytics.

 How They Beat The Competition

Narrow Focus and Perfect Execution

Whoop’s success seems strange to most outsiders because their product doesn’t include any of the features consumers have come to expect from modern wearable devices: it doesn’t track time, steps, active minutes, play music, or send notifications. 

But when it comes to tracking cardiovascular strain, recovery, and sleep, nothing compares to the Whoop strap. The woven bracelet uses optical sensors that collect health metrics 100 times per second to record heart rate, blood oxygenation, and breathing rate, all while being discreet and comfortable to wear. 

With the Whoop App, users can track the real-time effects of their daily habits on their physical health, such as a lack of REM sleep after a night of drinking or how a stressful week impacts their heart rate variability. 

Among top athletes who want to systematically monitor their physical condition, Whoop is the brand of choice by a wide margin— and that’s also what’s fueled mass market appeal.

Creating a Product for Top Athletes to Build Brand Identity 

When Whoop launched in 2012, it seemed like every big brand was jumping into the wearable fitness tracker market with the announcement of the Nike Fuel Band, the Adidas miCoach, and Under Armour’s UA Band, to name just a few. 

Only one of those competitors was a real threat to Ahmed: Nike. He’d long admired the Nike brand and how it was built on storytelling and authenticity— the people who wore their shoes jumped higher and ran faster than everyone else.  

Ahmed feared Nike would do the same with the Fuel Band: create a high-value product that top athletes latch onto. Fortunately for Whoop, they cut corners and built a product for mass market appeal that wasn’t precise enough for professional athletes and their standards.

While Nike may have abandoned their founding playbook, Ahmed didn’t. His go-to-market plan was to simply build the best product possible that top athletes would pay for, and it worked. In fact, Michael Phelps and LeBron James were among the first hundred Whoop users!

What’s even better is that Whoop didn’t have to pay the athletes with expensive sponsorship deals that notoriously entail million-dollar payouts or profit splits. Funny enough, Ahmed only found out Lebron James used his product when he saw the athlete wearing a Whoop strap in a Kia commercial.

Get In Touch

1) Promote Yourself! Get in front of 7,000+ business professionals by sponsoring this newsletter (we ❤️ our sponsors). Just hit reply to this email and say, "Let's partner!"

2) Do You Have An Outlier Business? We want to share your story if you are building something cool and growing fast. Hit reply to this email and tell me - what you're building, why, and why it's an outlier business.

3) Ask Us Questions: Are you struggling with a business or career question? Just ask it, and we'll share it with thousands of people who want to help.