There are many profit models in fitness application start-ups:
Advertising-App open screen, home page banner cooperative topics, and self-owned community media can all accept commercial advertisements. Some accept content marketing in the application. There could be some products or service recommendation in articles about health. If the application has a social function, advertising is also allowed in the social community just like Facebook.
Value-added Service-Many applications have membership subscription service, if users want to enjoy more functions or services, they have pay to upgrade to membership. Some fitness application have online fitness course or online consulting service, if users want to enjoy these services, they have to pay for them.
Online store-Some manufacturers sell their smart wearable devices on the online store in their application. According to iResearch, the largest part of China’s current consumer spending on fitness is shoe accessories, which account for more than 70% of total expenditure on sports consumption, which is much higher than the expenditure on stadiums, membership fees, and private education fees.
The problem of advertising is that it may bother the users and damage customer experience. The irrelated and frequent advertisement is an ordeal to users’ patience. It may cause the loss of users. The membership fee is not suitable for start-ups with the limited amount of users. We are not the manufacturer of wearable devices, so we don’t have the e-commercial gene. As a result, we should rethink these profit model and take a further excavation to them.
Our Profits model
Online store
Wearable devices such as shoes, clothes, watches, and bracelets could also be sold to users in the online shop. We are not manufacturers, but we could gather cost-effective products from all kinds of brands. In this way, our platform could be fairer and give more choices to customers.
Commercial Cooperation
Spots brand companies have a strong motivation to link their business to fitness application. It is a new channel to promote their clothes, shoes and wearable devices. We could cooperate with these companies. They could sponsor the sports match in reality. The reward will be offered by them and in order to broadcast their matches on fitness application, they should pay for us to enlarge the public participation. This will benefit both sports companies and us. It is a double-win marketing strategy. We could also cooperate with gyms, we could introduce coaches online and open offline courses. They have to pay for us or cooperate with us if they want to expand their business. This will further enhance fans’ viscidity and complete a virtuous cycle.
Transaction fee
In “carrot and stick” model, we could charge 0.4 percent transaction fee from total amount pledge of a race. The percentage should be as low, if charging too much, it will be regarded as an exploitation tool which will have a bad impact on expanding the business. Furthermore, transaction fee model can make a huge contribution when the application has oceans of registers and users. At the early stage, the revenue from the transaction could be neglected since the amount is so little.
Advertising
If the advertisement is useful to users, users will have less antipathy. The application could collect users’ sports data from their wearable devices. These data could reflect users’ heart rate, exercise intensity, sports rhythm and even their blood pressure and quality sleep. These data have high business value. Based on user’s personalized data, our system could recommend related products. For example, healthcare products, nourishment drinks or food. Our platform will charge for advertising from these companies. We could give suggestions about eating-habits or training skills to users for free as well according to their sports data.