IDC: Wearables Shipments Jump Almost 22% YoY in Third Quarter
New wearable products from companies including Fitbit, Garmin and Huawei led to global wearables shipments of 32 million units during the third quarter of 2018. That represents a jump of 21.7% over the year-ago quarter, according to IDC.
The category still is evolving, according to the firm’s Worldwide Quarterly Wearable Device Tracker. “Many of the new basic wearables include features like notifications or simple app integrations that bleed into smartwatch territory,” said Jitesh Ubrani, the senior research analyst for IDC Mobile Device Trackers in a press release. “This has helped satiate consumer demand for more capable devices while also maintaining average selling prices in a market that faces plenty of downward pressure from low-cost vendors and declining smartwatch pricing. However, this resurgence of basic wearables should be watched closely as these wearables have historically been popular due to their low-price points and simplified set of features. As more features get added and as the price differential between basic trackers and smartwatches narrows, brands could potentially move consumers upstream to smartwatches.”
The growth is not consistent. IDC found that the Asia-Pacific market, excluding Japan, accounted for half of all shipments and grew 21.4% year-over-year. The United States had very different results, with a decline of 0.4%.
Another sign that the market is still developing is inconsistent results worldwide. “The wearables market benefits from geographic differences,” Ramon Llamas, the Research Director for IDC’s Wearables team, said in the press release. “China – the largest market for wearables and more than double the size of the U.S. market – has grown thanks to strong device development and experimentation, low-cost products, and strong demand for basic devices to draw in new users. Meanwhile, the U.S. market – while slowing down – presents an opportunity for vendors to offer more featured and higher-priced devices to current users and possibly to recapture old ones. In between the two markets are many other countries in various states of development, and this allows vendors to take different approaches to meet demand. Combine these geographic differences with the new product announcements and releases, and the stage is set for a strong holiday quarter.”
A sign that some order is coming to the sector is the fact that the “other” category beyond the top five brands declined by almost 10%. It was 52.7% at the end of the third quarter of 2017 and 43% at close of the third quarter this year.
The analysts said that Apple and Fitbit, the two largest brands, are digging deeper into the healthcare market. The rationale is that the greater regulation and scrutiny of this sector will make it the one that “staves off value brands” over time.
The top five wearable companies in the third quarter, according to IDC, were Xiaomi (90.9% year-over-year growth), Apple (54% YoY growth), Fitbit (3.1% YoY decline), Huawei (20.3% YoY growth) and Samsung (20.3% YoY growth).