(Photo courtesy marketwatch.com)
MyFitnessPal is getting friend-dumped. Under Armour acquired MyFitnessPal for $475 million just 5 years ago. Now, it’s looking to part ways with the diet and exercise-tracking app.
Besides monetizing with subscriptions and ads, Under Armour didn’t use MyFitnessPal to create a holistic fitness brand. It didn’t merge it into an Under Armour app, or leverage it to drive apparel sales through recommendations.
Now with Covid-19 exacerbating Under Armour’s financial struggles, Under Armour is actively seeking buyers for the app.
It’s important to note that the actual cost of acquiring (and then ditching) the MyFitnessPal app is higher than the $475 million Under Armour paid for the app in 2015. The company also had an opportunity cost – It could have spent the money on something else instead.
Opportunity cost refers to the value of what you have to give up in order to choose something else. For example, with that $475 million Under Armour could have created its own athleisure line or bought a company like Peloton, which may have proven to be more lucrative investments.