2022-07-06
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IDC Wearables Report

Indian brands might no longer be the frontrunners in the smartphone market, but they are doing remarkably well when it comes to wearables. And while the Indian smartphone market is showing signs of slowing down, all is well on the wearables front. IDC recently released data from its India Monthly Device Tracker for Q1 2022 and its findings make for an interesting read.

It was a quarter that saw true wireless stereo (TWS) earbuds and basic watches grow by leaps and bounds even as fitness bands and more advanced smartwatches lost ground. Here are some of the interesting aspects of the data shared by IDC.

Impressive growth overall

In its report, IDC divides wearables into three categories β€” wrist bands (mainly fitness bands), watches (basic smartwatches and smartwatches that run Watch OS and Android Wear), and earwear (TWS and Bluetooth earphones). As per the data, the wearables market in India grew by an impressive 20.1 percent in Q1 2022.

In total, 13.9 million units of wearables were shipped as compared to 11.5 million in Q1 2021. A number of our sources in retail have told us that this growth has been largely spurred by the pandemic and the lockdowns that accompanied it. While the need to work at home spurred wearables sales, fear of COVID caused greater health consciousness and led to more consumers investing in devices that could track data like heart rate and blood oxygen saturation level (SpO2).

Watches set the pace, as fitness bands fade

They might have started the wearables revolution in India in 2015, but wrist bands seem to be losing popularity if IDC’s statistics are anything to go by. Shipments of wrist bands were 0.26 million in Q1 2022, down by a massive 65.9 percent as compared to 0.76 million in Q1 2021 β€” their ninth consecutive quarter of decline.

A key reason for their fall, we suspect, is the fact that smartwatches are becoming affordable β€” you can get a smartwatch for under Rs 2,000 now, which is about the same that purchasing a wrist band from a well-known brand will cost you. Indeed, watches drove the growth in the wearables segment, recording a staggering growth of 173 percent, and more than doubling from 1.3 million to 3.7 million. Clearly, users seem to prefer larger displays and more data. And lower prices too, as the next point will illustrate.

“Basic” smartwatches grow by more than 200 percent, “real” smartwatches dip

The rise in the popularity of smartwatches seems to be clearly driven by what IDC calls “basic watches” (watches that generally do not support calling and have fewer features). These basic watches in fact comprised as much as 95.1 percent of all watch shipments in Q1 2022, reflecting an amazing growth of 202 percent. On the other hand, smartwatches (as per IDC, watches like Apple Watch and those that run Android Wear) actually registered a dip in growth by 4.2 percent.

The popularity of basic watches also meant that the average selling price of watches generally declined from $86 in Q1 2021 to $50.3 in Q1 2022.

Earwear still has the lion’s share of wearables (with TWS share growing)

The vast majority of wearables shipped in the Indian market were earwear, or Bluetooth earphones and TWS. Of the 13.9 million units of wearables shipped in Q1 2022, 9.9 million were earwear.

This number is up from 9.4 million as compared to Q1 2021, a growth of almost 5 percent. But while earwear grows and is still the biggest portion of the wearables market, its domination seems to be declining. Earwear was 81.7 percent of all wearables in Q1 2021, but that number is down to 71.2 percent in Q1 2022.

TWS getting more popular

Indian consumers seem to be getting rid of wires with a vengeance when it comes to personal audio. This can be seen from the fact that the share of TWS increased from 34.2 percent of earwear in Q1 2021 to 48.3 percent in Q1 2022, marking a growth of 48.2 percent.

In fact, more TWS were shipped in Q1 2022 than watches and wristbands put together. Β Of course, the growth of TWS means that the share of other Bluetooth earphones declined in this period. Β It will be interesting to see if this trend persists.

BoAt, Noise, and Fire-Boltt dominate

Three of the top five players in the wearables market were Indian brands. These were Imagine Marketing (BoAt), Nexxbase (Noise), and Fire-Boltt. BoAt took first place with a 22.9 percent share, while Noise took second spot with 10.9 percent, and Fire-Boltt came in fourth at 6.6 percent, just behind OnePlus at 7.4 percent, and marginally ahead of Realme which had the same market share.

In terms of growth, however, Fire-Boltt was the surprise package with a growth of 1522.2 percent (yes, you read that right!) as compared to Q1 2021, thanks mainly to its focus on watches, and its successful Ninja range.

Noise, too, recorded an impressive growth of 150.1 percent, spurred by multiple launches. BoAt, for its part, recorded a more modest growth of 5.2 percent, but it should be noted that its share of 22.9 percent is more than that of Noise and Fire-Boltt put together. Both BoAt and Noise profited by aggressive launches and pricing in both watches and earwear, while Fire-Boltt’s focus was totally on watches. Fire-Boltt is a stunning success when you consider the fact that it did not even have a 1 percent market share in Q1 2021.

Realme grows, OnePlus stalls

OnePlus was the only player in the top five to record negative growth in Q1 2022. The brand which had a 13.8 percent share in Q1 2021, dipped to 7.4 percent in Q1 2022. A point to note, however, is that it had no watch or band releases in this quarter and all its launches were in the earwear category.

That might change in the coming months with additions expected in the OnePlus watch range and even talk of a new fitness band. Realme, on the other hand, saw its share go up from 6.3 percent in Q1 2021 to 6.6 percent in Q1 2022. Its star performer was a TWS offering β€” the Realme Buds Wireless 2 Neo, which contributed a massive 43 percent of all its shipments.

Indian brands dominate watches, Chinese play it by ear(wear)

An interesting aspect of the growth of the wearables market is that while Indian brands seem to have done particularly well in the watch segment, their Chinese counterparts have scored in the earwear segment.

This can be partly attributed to the fact that both Realme and OnePlus focussed more on earwear in Q1 2022. It is interesting to see that Xiaomi was not able to get into the top five in spite of releasing new editions of its Redmi watch and smart band.

Look out for the “others”

The top five might make the headlines, but it is clear that the Indian wearables market is divided between a number of players. Of the leading players, only BoAt β€” with a share of 22.9 percent β€” can be said to have a dominant position.

Noise is a long way behind at 10.9 percent. In fact, “others” (those outside the top five) comprise a massive 45.6 percent of the market and recorded a growth of 13.9 percent as compared to Q1 2021. These “others” comprise some formidable players including Apple, Samsung (which owns JBL),

Xiaomi, Google (which owns Fitbit), Amazfit, Oppo, Jabra, Sony, and Sennheiser. We would not bet against some of them making inroads into the top five in the coming quarters, especially given the rumours of both a new Apple Watch and AirPods from Apple.

2022 will likely be a good year for wearables

As per IDC, 2022 is going to be a good year for wearables. IDC says that brands will try to attract consumers in Tier 2 and Tier 3 cities, and even more brands are expected to join the fray as the sector continues to grow.

As per IDC, Q2 2022 will see healthy growth, while the remainder of the year will see the growth momentum continue, thanks to offers that are expected to come in the traditional Indian festive season. Volumes are also expected to rise as prices are expected to further drop with “made in India” factors expected in this segment later in the year.

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