Basic Wearables Soar and Smart Wearables Stall as Worldwide Wearables Market Climbs 26.1% in the Second Quarter, According to IDC
06 Sep 2016
FRAMINGHAM, Mass. September 6, 2016 – Shipments of wearable devices reached 22.5 million in the second quarter of 2016 (2Q16) according to the International Data Corporation (IDC) Worldwide Quarterly Wearable Device Tracker. Despite a decline in shipments for one of the largest vendors, the overall market for wearable devices grew 26.1% year over year as new use cases are slowly starting to emerge.
"Fitness is the low-hanging fruit for wearables," said Jitesh Ubrani, senior research analyst for IDC Mobile Device Trackers. "However, the market is evolving and we're starting to see consumers adopt new functionality, such as communication and mobile payments, while enterprises warm to wearables' productivity potential."
While the overall wearables market grew during 2Q16, its two categories traveled at different speeds and directions. Basic wearables (devices that do not support third party applications) grew 48.8% from 2Q15 levels while smart wearables (devices that support third party applications) declined 27.2% year over year.
"Basic wearables, which include most fitness trackers, have benefited from a combination of factors: a clear value proposition for end-users, an abundant selection of devices from multiple vendors, and affordable price points," said Ramon Llamas, research manager, Wearables. "Consequently, basic wearables accounted for 82.8% of all wearable devices shipped during the quarter, and more vendors continue to enter this space. The danger, however, is that most devices end up being copycats of others, making it increasingly difficult to differentiate themselves in a crowded market.
"Smart wearables, meanwhile, are still struggling to find their place in the market," added Llamas. "There is plenty of curiosity about what smart wearables – particularly smartwatches – can do, but they have yet to convince users that they are a must-have item. The good news is that smart wearables are still in their initial stages and vendors are slowly making strides to improve them. But this also means that it will be a slow transition from basic wearables to smart wearables."
Fitbit's dominance remains unchallenged for now as the company's name is synonymous with fitness bands. The latest Charge 2 and Flex 2 are indicative that the company is growing up, giving form and function equal importance. Fitbit's recent accquistition in the mobile payments arena should also help ensure success in the longer term.
Xiaomi Mi Bands remain extremely popular in China. In every technology market, Xiaomi has focused on the value conscious consumers, and that trend continues. The recent launch of the Mi Band 2 includes heart rate tracking and still maintains a price below $20 USD. The challenge for Xiaomi, however, is growing beyond China's borders and onto the global stage.
Apple was the only vendor among the market leaders to post a year-over-year decrease in shipment volumes, primarily because it did not launch a new model on the anniversary of its first generation Watch. 2Q16 was the first full quarter of Apple's reduced price strategy on the Sport model, which slightly helped the company rebound from its post-holiday slump.
Garmin's vertical integration and constant expansion of the ConnectIQ app store have allowed the company to slowly expand its channel presence and gain consumer mindshare. While it remains focused on fitness enthusiasts and athletes, the latest design of the Fenix Chronos will certainly help broaden its appeal to the masses.
This is the first time Lifesense has broken into the top five on the strength of by its low-cost Mambo fitness trackers shipping into China. It also connects with WeChat, an immensely popular messaging service in China, to share data with others without having to log into a separate application.
Top Five Wearable Device Vendors, Unit Shipments, Market Share, and Year-Over-Year Growth, Q2 2016 (Units in Millions)
2Q16 Unit Shipments
2Q16 Market Share
2Q15 Unit Shipments
2Q15 Market Share
Source: IDC Worldwide Quarterly Wearable Device Tracker, September 6, 2016
- Vendor shipments are branded device shipments and exclude OEM sales for all vendors.
- The "Vendor" represents the current parent company (or holding company) for all brands owned and operated as a subsidiary.
This chart is intended for public use in online news articles and social media. Instructions on how to embed this graphic are available by clicking here.
About IDC Trackers
IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools. The IDC Tracker Charts app allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad. The IDC Tracker Chart app is also available for Android Phones and Android Tablets.
For more information about IDC's Worldwide Quarterly Mobile Phone Tracker, please contact Kathy Nagamine at 650-350-6423 or email@example.com.
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group (IDG), the world's leading media, data and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.
ContactFor more information, contact: