Garmin Connect Plus: Controversial smartwatch subscription seems to be successful as company stays the course

We have covered Garmin’s Connect Plus more than once. It is a paid premium subscription that gives Garmin smartwatch users additional features, as Garmin tends to put new AI features behind this paywall. The launch of Garmin Connect Plus has drawn substantial criticism from quite a few users. In our view, Garmin broke a never-explicit but likely implicit understanding between Garmin and its customers with the introduction of Garmin Connect Plus. Garmin smartwatches are relatively expensive, but Garmin Connect includes many free features and even a web interface that allows users to view workouts and analyze them.

Among other things, Garmin Connect Plus offers the option to track diets via a food log and the camera, personalized recommendations are also available. It also includes AI-based recommendations and the so-called Performance Dashboard, which lets users create custom charts. On an investor call, Garmin’s president and CEO was recently asked about subscription services like these. Specifically, Eric Woodring asked about Garmin's priority on expanding recurring revenue, meaning subscription models. Pemble emphasized that Garmin wants to grow that revenue but also the business model behind it. Of course, it is worth noting that a CEO is aware that such statements will be made public. According to Pemble, Garmin’s subscription business is currently growing at least as fast as the overall business, or even faster. Even so, subscriptions still account for less than 10% of Garmin’s overall revenue. Garmin Connect Plus likely contributes to that growth, but Garmin also offers other subscriptions, such as Outdoor Maps Plus and inReach communication services.