According to a new report, as the wearables market transforms, total shipment volumes are expected to maintain their forward momentum.
According to the IDC Worldwide Quarterly Wearable Device Tracker, vendors will ship a total of 125.5 million wearable devices in 2017, marking a 20.4 percent increase from the 104.3 million units shipped in 2016. From there, the wearables market will nearly double before reaching a total of 240.1 million units shipped in 2021, resulting in a five-year CAGR of 18.2 percent.
Research manager for IDC’s Wearables team Ramon Llamas said that since the market’s inception, it’s been a matter of getting product out there to generate awareness and interest.
"Now it’s about getting the experience right, from the way the hardware looks and feels to how software collects, analyzes, and presents insightful data. What this means for users is that in the years ahead, they will be treated to second- and third-generation devices that will make the today’s devices seem quaint. Expect digital assistants, cellular connectivity, and connections to larger systems, both at home and at work. At the same time, expect to see a proliferation in the diversity of devices brought to market, and a decline in prices that will make these more affordable to a larger crowd.”
Opportunities also exist for developers and channel partners to provide the apps, services, and distribution that will support the growing abundance of wearables. From a deployment perspective, the commercial segment also stands to benefit as wearables enable productivity, lower costs, and increase ROI in the long term, the report said.
IDC thinks watches will account for the majority of all wearable devices shipped during the forecast period.
"However, a closer look shows that basic watches (devices that do not run third-party applications, including hybrid watches, fitness/GPS watches, and most kid watches) will continue out-shipping smartwatches (devices capable of running third party applications, like Apple Watch, Samsung Gear, and all Android Wear devices), as numerous traditional watch makers shift more resources to building hybrid watches, creating a greater TAM each year. Smartwatches, however, will see a boost in volumes in 2019 as cellular connectivity becomes more prevalent on the market."
Once the overall leaders of the wearable market, wristbands will see slowing growth in the year's ahead. The sudden softness in the wristband market witnessed at the end of 2016 will carry into subsequent quarters and year, but the market will be propped up with low-cost devices with good enough features for the mass market. In addition, users will transition to watches for additional utility and multi-purpose use, the report said.
Smart clothing market took a strong step forward, thanks to numerous vendors in China providing shirts, belts, shoes, socks, and other connected apparel. While consumers have yet to fully embrace connected clothing, professional athletes and organizations have warmed to their usage to improve player performance. The upcoming release of Google and Levi’s Project Jacquared-enabled jacket stands to change that in 2017, it added.
Lesser known products like clip-on devices, non-AR/VR eyewear, are not expected to grow much, but the sector is worthwhile watching as numerous vendors cater to niche audiences with creative new devices and uses.