Sporting goods maker and retailer adidas AG purchased fitness app developer Runtastic GmbH earlier this month for 220 million euros, or $241.19 million.
Adidas, No. 255 in the 2015 Mobile 500, sees the acquisition of Runtasic, an Austrian company that’s developed more than 20 apps in 18 languages for endurance, health and fitness activities, as a way to add depth to micoach.adidas.com, its online community for athletes to store their performance information and share with others for a wide variety of sports.
“[The acquisition] offers the opportunity to grow a highly engaged athlete user base and leverage the power of our broad product portfolio,” adidas CEO Herbert Hainer told analysts on the company’s second quarter earnings call based on a transcript from SeekingAlpha.com.
Other fitness apparel retailers, including Under Armour Inc., have also purchased established fitness apps. In February, Under Armour purchased personal training app Endomondo for $85 million and weight loss coaching app MyFitnessPal for $475 million. Between these apps, the MapMyFintess app that Under Armour acquired in 2013 and Under Armour’s digital fitness program Connected Fitness, UnderArmour has access to 140 million consumers, said Kevin Plank, UnderArmours CEO in the company’s second quarter earnings call based on a transcript from SeekingAlpha.com.
Runtastic has amassed 140 million total downloads and 70 million registered users across its 20 global apps, including close to 10 million consumers in the United States, Hainer said. 50% of Runtastic’s revenue comes from Europe, around 12% to 15% in America, 25% in Asia and the rest in Latin America, Hainer said. Runtastic has about 140,000 new downloads each day, he added.
Runtastic’s apps sync with mobile and wearable devices to track performance data, such as distance, speed, pace, time, heart rate, calorie consumption and route traveled for running, biking and related exercise activities. Athletes can view results directly in the app, on various devices with global positioning system devices or on Runtastic.com.
Adidas wants to give athletes and others more ways to track their performance in detail and then target those athletes with online offers of gear and apparel to help improve their results, Hainer told analysts.
Adidas purchasing Runtastic makes sense, as other athletic wear companies are pairing digital products with their gear, says Kyra Bobinet, CEO at engagedIN, a behavior design firm for the health and wellness industry.
“Adidas is trying to catch-up,” Bobinet says, citing both Under Armour and Nike Inc. as fitness apparel companies that already built fitness communities around their gear.
“Right now, athletic wear companies are seeing digital assets as brand extensions and user experience enhancements,” Bobinet says.
Follow mobile business journalist April Berthene, associate editor, mobile, at Mobile Strategies 360, @Mobile360April
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