Dubai: Basic wearable bands, primarily fitness trackers, experienced double-digit growth in the third quarter as smartwatches took a hit.
With holiday season in full swing, research firm International Data Corporation, (IDC) expects the momentum for basic wearables to continue for the remainder of 2016 as the holiday season is now in full swing.
However, smart wearables capable of running third party apps will likely continue to struggle in the near term.
The overall wearables market grew 3.1 per cent year over year in the third quarter with basic wearables accounting for 85 per cent of the total.
“It’s still early days, but we’re already seeing a notable shift in the market,” said Jitesh Ubrani senior research analyst for IDC mobile device trackers.
“Where smartwatches were once expected to take the lead, basic wearables now reign supreme. Simplicity is a driving factor and this is well reflected in the top vendor list as four out of five offer a simple, dedicated fitness device. Meanwhile, from a design perspective, many devices are focusing on fashion first while allowing the technology to blend in with the background,” he said.
Fitbit was once again the market leader due to the release of Charge HR with the Charge 2. Despite recent negativity surrounding the company’s long-term strategy and stock price, IDC expects Fitbit to continue leading the pack in the near term. The acquisition of Coin and the potential to expand into the smartwatch category present an opportunity for the company to be more than just a fitness brand.
With Fitbit likely to purchase Pebble, the competition among the fitness trackers is going to intensify further.
Xiaomi’s new Mi Band includes heart rate tracking and is priced well below any competition, making it more suitable for impulse buying than any other fitness band.
Despite its worldwide growth in quarter, the company managed to lose market share as almost every other vendor outpaced its growth. Xiaomi, across all business lines, continues to struggle to gain any significant traction outside its home country of China.
Garmin captured the third position as the company with one of the widest portfolios among all the vendors in this market. Yet its strategy and branding remain focused on fitness die-hards.
Apple’s decision to launch its second-generation watches in mid-September, towards the end of the quarter, did contribute to its year-over-year decline.
Ramon Llamas, research manager for IDC’s wearables team, said that the primary reasons for the downturn were an ageing line-up and an unintuitive user interface. Though both issues have been addressed with the latest generation watches, Apple’s success will likely be muted as the smartwatch category continues to be challenged.
However, he said that Samsung released two new models, Gear Fit 2 and the Icon X, in the third quarter and it was able to sustain shipments of its Gear S2, particularly the cellular-enabled versions, through various wireless service providers.
“Smart wearables have been down in recent quarters, but clearly not out. As user tastes change, so will their needs. That’s the opportunity for smart wearables with multi-functionality and third-party applications, both for consumers and business users.
“To get there, we need to see more intuitive user interfaces, seamless user experiences, stand-alone connectivity, and applications that go beyond health and fitness and into personal and professional productivity,” Llamas said.