Wearables market expands as Fitbit share grows

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Smartwatches such as the Apple Watch may have been thought of as the devices which will usurp simpler wearable devices such as the Fitbit, but it doesn’t look like it’s turning out that way. 

According to new figures released by IDC, the smartwatch market has shrunk in the third quarter of 2016 while the overall market has grown more than 3 per cent, compared with the same quarter last year.

Perhaps significantly, Apple has seen a 70 per cent year-on-year decrease for the third quarter in unit shipments of its Watch. Samsung, meanwhile, has seen an 80 per cent increase.

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It could be that people prefer their wearables to be a simpler device, dedicated to monitoring their heart rate, the distance they cover, and so on, rather than a more sophisticated, multipurpose device which has more powerful and sophisticated computing and communication capabilities, like the Apple Watch.

Or maybe the Apple Watch, priced at around $500, is just too expensive, compared with, for example, a Fitbit Blaze, which can be bought for around $150.

Also, the market now has many vendors, with wearables launched by companies such as Samsung, Huawei, Xiaomi, Garmin, Mondaine, Polar, Pebble, LG, Vector, Casio, and Tag Heuer.

“Wearables” in this context could be said to mean “computerised watches”, since they are mostly worn on the wrist. Casio is famous for calculators going way back and inexpensive digital watches, and more recently it has made a name for itself with its G-Shock brand for the middle market. Tag, meanwhile, is known as a high-end watchmaker.

But it’s what IDC calls “basic wearables” which is apparently driving the market, accounting for 85 per cent sales and experiencing double-digit growth.

Jitesh Ubrani, senior research analyst for IDC mobile device trackers, says: “It’s still early days, but we’re already seeing a notable shift in the market.

“Where smartwatches were once expected to take the lead, basic wearables now reign supreme. Simplicity is a driving factor and this is well reflected in the top vendor list as four out of five offer a simple, dedicated fitness device.

“Meanwhile, from a design perspective, many devices are focusing on fashion first while allowing the technology to blend in with the background.”

Ramon Llamas, research manager for IDC’s wearables team, says: “Smart wearables have been down in recent quarters, but clearly not out.

“As user tastes change, so will their needs. That’s the opportunity for smart wearables with multi-functionality and third-party applications, both for consumers and business users.

“To get there, we need to see more intuitive user interfaces, seamless user experiences, standalone connectivity, and applications that go beyond health and fitness and into personal and professional productivity.”

Among the developments in the market IDC notes is that Fitbit, being the market leader, is likely to continue growing; Xiaomi, the challenger, may benefit from being the lowest-priced device in the market, and Garmin, the third-placed company, has gained a good reputation in the sports sector.

Fitbit will increase its lead in the market if it buys Pebble for $40 million, as reported in BGR.com.