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The wearables market includes electronic devices that are designed for fitness. These wearable technology devices are fitted with sensors and Bluetooth that measure a number of bodily movements such as the number of steps taken, heartbeats, temperature, running speed, calories burnt, etc. Fitbit is the most popular example. The market for wearables is driven by the demand for devices such as body monitors, smart clothing, and activity trackers which in turn is the result of increasing rates of obesity and other chronic diseases. People want to monitor diverse health metrics such as level of sleep, calorie intake, heart rates, etc. and these wearable technology devices put them in control to do just that.
The global wearable technology market was worth an estimated USD 33.07 Billion, growing at a CAGR of 16 percent during the forecast period 2018-2025. High rates of chronic disease conditions and the growing social awareness of the types and benefits of wearables is expected to drive the demand for the wearables industry.
North America emerges as the leader of the wearable technology, with a market share of 30 percent or USD 9.9 Billion. Factors such as health issues, healthcare-related awareness put countries like the US and Canada at the forefront of the wearables industry. 90 percent of Americans reportedly use a wearable fitness tracker, and a mobile health app. About 50 percent of all upper-income households in the US were or are currently using a fitness tracker. In the middle-income households, that figure stands at 30 percent and 25 percent in low-income households. Urban areas have more users of wearable technology than rural households, 35 percent against 30 percent, respectively. Adults younger than 55 years of age, are twice as likely to use wearable devices than those aged 55 and above. Fitness trackers and health apps tend to be a bit more popular among women than they are among men.
The Wearable Technology Market shows steady and substantial growth in the European region. The European wearable technologies market closely trails North America, at about 28 percent share of the global market, or USD 9.3 Billion.
The Asia-Pacific wearable technologies market is estimated to be around 25 percent of the global market, or USD 8 Billion, leaving about 17 percent to the rest of the regions such as MENA and South America. Asia Pacific is expected to be the most attractive market for wearable technology due to the growing purchasing power of the growing middle-class population comprising millennials and Gen-Z consumers, who are a born tech-savvy population. Also, a number of wearable technology companies are expected to move their manufacturing facilities to APAC, given the low labor and operational costs.
The wearable technology market has been segmented into seven predominant segments namely, wrist wear, eye-wear, head wear, hearables, bodywear, neckwear and footwear The wristwear is the most popular segment, with a 50 percent market share. Wrist wear devices can be connected with mobile apps to give the user key fitness-related metrics. There is a short term impact on the production of wrist bands and smartwatches due to the pandemic situation. The eye-wear and headwear segments together makeup 25 percent of the market, and are the fastest growing segment at a CAGR of 17 percent. Footwear takes up 12 percent, Neckwear 4 percent, and Bodywear 8 percent.
On the basis of application, wearable technology finds use in electronics, healthcare, enterprise, industry, defense, fitness and sports. The consumer electronics segment is the biggest segment, accounting for almost 50 percent of the market. The demand from young consumers, particularly the health-conscious millennials, is channeling wearable technology developers to focus more on the luxury standards, durability and functionality of the devices. AI-enabled wearables are finding use in the healthcare industry such as remote heart health monitoring, allowing for zero-error communication between doctors and patients. Meanwhile, in the sports field, Sweat sensors, water and electrolyte loss rates measurement are benefiting athletes.
Apple, Fitbit, Nike, and Xiaomi are popular manufacturers of wristwear wearable devices. Eyewear products are primarily manufactured by Google, Microsoft such as the Google glass and Microsoft HoloLens. Several other players from the APAC and Europe such as Samsung, Sony, Huawei, LG, Adidas, TAG Heuer, are in the wearables space as well. If you look at the market share of wearables unit shipments worldwide, Fitbit’s market share has shrunk from 45 percent in Q1 2014 to 3 percent in Q1 2020. Jawbone, Garmin and Fossil too, have disappeared from the worldwide unit shipments top charts over the last 2 years, ceding market share to Xiaomi, Huawei, Apple and Samsung. Apple is the third largest wearable vendor today, thanks to its smartwatch. The Apple smartwatch market is a promising segment within the wearable industry, as global smartwatch shipments rose by 120 percent between 2015 and 2017.
Rising costs of devices and data privacy concerns are still challenges to this market, but wearables are continuing to become ubiquitous. The smartwatches & fitness bands market is expected to grow at a CAGR of above 20% over the next few years, due to efforts by large technology companies for the development of smart analysis technologies such as real-time health status analysis. The growing smartphone penetration, especially in developing regions such as India and other APAC countries, coupled with fast and cheap internet availability, is driving the adoption of smartwatches and fitness bands. Furthermore, the growth of AI and 5G technologies will only position the wearable technologies market for accelerated growth in the times to come.
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