Growth in wearables is expected to slow dramatically this year for three reasons, all coronavirus related.
First, there is arguably less need for things like smartwatches while people are under lockdown at home. Fitness functionality is less relevant when gyms are closed and many people are unable to exercise as much as usual …
There is also less benefit to things like Apple Watch notifications when people are at home with their phone in front of them instead of in their pocket. (AirPods are probably more of a wash: they are normally used mostly outside the home, but with so many video calls these days, that may be balanced by in-home use.)
Second, some have lost their jobs or are on lower incomes, meaning fewer people with the kind of disposable income needed to buy tech products.
Third, even those still earning their full salary may be nervous about their financial future and choosing to save money rather than spend it on luxuries.
ABI research thinks the combined impact will be to slow the growth in wearables from 28% last year to just 5% this year. The form made the forecast in its Mobile Accessories and Wearables Market Share and Forecasts report.
Wearable shipments in 2020 are now expected to be 254 million, down from the previously forecasted 281 million, states ABI Research, a global tech market advisory firm. Although a significant drop, this new COVID-19 impacted forecast is a minor increase from the 241 million shipments in 2019. However, this now puts the estimated YoY increase at 5%, compared to 23% between 2018 and 2019 and the previously expected 17%.
“While wearables will see fewer shipments this year than originally expected, shipments of devices that can track and monitor healthcare vitals has lowered the impact,” says Stephanie Tomsett, research analyst at ABI Research. “Healthcare wearables are already being utilized to help track the progression of COVID-19 and monitor patients remotely.”
Things may improve next year as the economy slowly recovers and there is greater consumer focus on health.
Many devices, such as those from Apple, Samsung, Fitbit, Withings, and Oppo, are offering, or expected to soon offer, advanced monitoring features such as ECG tracking, sleep apnea detection, arrhythmia detection, and blood oxygen tracking. The incorporation of these features into devices, particularly smartwatches, that already have several other features, allows users to utilize one device rather than multiple devices for different purposes.
“The COVID-19 pandemic has brought a higher health awareness to all individuals around the world. Wearables with advanced health monitoring features will begin to buoy the wearables market in the second half of 2020 and pave the way for 289 million wearable shipments by 2021 and 329 million by 2022 as the world recovers from the pandemic,” concludes Tomsett.
Apple does, however, still dominate the wearables market, a recent report estimating that the Cupertino company has a 29.3% market share, far larger than any other brand.
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