With technology seeping deeper and deeper into our daily lives, the future of smart “wearables” looks bright. Wearables is a common term for devices or technology with features like scanners and sensors, and are, obviously, worn by a person. They come in different types, such as clothes, spectacles, accessories, head or wrist bands, ear plugs, or shoes.
These devices have become so innovative that the utility, convenience, and engagement offered by them have become far too compelling to ignore.
The shipment of wearable devices was around 80-85 million units in 2015. According to a report by IDC, the worldwide shipment of wearable devices is expected to reach 101.9 million units by the end of 2016 – reflecting a 29% growth over 2015. The market for these devices will experience a compounded annual growth rate of 20.3% to touch 213.6 million units in 2020.
A CCS Insight release expects the shipments to touch 245 million units and wearables markets to be worth over $25 billion by 2019. A more bullish prediction is made by marketsandmarkets which expects the overall wearable technology market to reach $31.27 billion by 2020, at a CAGR of 17.8% between 2015 and 2020.
A PricewaterhouseCoopers report says, “for wearables to be most valuable to the consumer, it needs to embrace Internet of Things (IoT) opportunities; transform big data into super data that not only culls, but also interprets information to deliver insights; and take a human-centered design approach, creating a simplified user experience and an easier means to achieve goals.”
The report also suggests that the consumer market as well as the business to business (B2B) market stand to be radicalized by the mainstreaming of wearable technology in the coming days.
Wearables would have far reaching implications in fields of medical research, patient monitoring and treatment, fitness, transportation, retail, media, entertainment and communications (EMC), gaming, social media and technology.
People are excited and adopting wearable technology which has fast-moved beyond wrist-worn devices. Today, products such as smart shoes, apparels, clip-on accessories, hearables, augmented and virtual reality headsets, eyewear and wearable cameras are gaining demand, although smartwatches and wristbands continue to dominate the market in terms of revenue contribution as well as sales volume.
The smartwatch and wristband segments made up 90% of the market share in 2015, as per IDC report. However, it projects that the dominance will trim down to around 80% by 2020 with eyewear and clothing holding a higher market share. The CCS Insight forecasts that other than smartwatches and fitness trackers, wearable cameras could witness phenomenal growth in the next five years. GoPro currently dominates this segment.
It is important to understand that the dynamics of the market share would change in the times to come and some products which may not hold a high share in terms of numbers of units would be substantial revenue generators. One such category is eyewear which may present a smaller market share – but would hold a reasonable share in terms of revenue in the future due to high cost for such specialized products.
It is estimated that by 2020, eyewear would account for 40% of the total revenue for wearables despite a sub 10% market share in terms of devices shipped. Microsoft’s Holographic, Google’s Glass and Garmin’s Varia Vision and Project Genesis from VSP Global are some of the interesting developments in the eyewear space. Smart contact lenses are another high-end technology of wearable device where companies such as Google, Samsung and Sony are actively working.
Clothing, shoes or belts especially related to sports and fitness are seen to have great potential among wearables. Brands such as Samsung, Google, Under Armour, Lenovo, Hexo Skin and OMSignal are engaged in this segment.
Among wrist-worn wearables, devices such as the Apple Watch, Motorola’s Moto 360, Sony SmartWatch, Pebble Time, Garmin Vivoactive, Huawei Watch are popular. While among wristbands, Fitbit remains influential although it is being challenged by low-cost vendors such as Xiaomi and smartwatches which are focusing on fitness features.
Sports brands like Adidas and Nike have already made their debut in the wearables technology market. As people are becoming more and more health conscious, it is believed that fitness and heath related applications on these devices would become a crucial factor in their appeal to consumers.
Overall, the major players in the fast growing global wearables technology market are Apple, Inc. (
), Fitbit, Inc. (
), Alphabet, Inc. (
), LG Electronics, Inc. (
), Pebble Technology Corp., Samsung Electronics Co., Ltd. (
), Sony Corporation (
), Garmin Ltd. (
) and Xiaomi Technology Co., Ltd.
While the wearables technology holds a promising future, the product success would eventually depend on their security aspect, ease o