Global Smartwatch Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Global Smartwatch Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The global smartwatch market was valued at 68.59 million units in 2020, and it is expected to reach 230.30 million units by 2026, registering a CAGR of 21.98% during the forecast period (2022-2027). With the recent outbreak of COVID-19, the global demand for electronics slumped significantly during the first quarter of 2020. However, the sales of wearable devices such as smartwatches witnessed a major influx from online sales, cutting out various other costs. The buyers were capable of buying products for lower prices on online platforms and comparing features and prices.

Key Highlights

• Due to the rising penetration rates of urbanization, the demand for aesthetically appealing advanced products to serve better the consumers’ requirements, such as time schedules and multiple features in one device, has been driving the global need for smartwatches. Moreover, the huge millennial population has been adopting smartwatches due to increased spending on tracking and luxury standards for their regular work hours.
• Currently, smartwatches are designed for being paired with smartphones (via Bluetooth), which function as information gateways so that these watches can share phone notifications, such as text messages, email notices, or application alerts. However, smartwatches are not interchangeable since they can usually only be paired with a limited number of compatible smartphones. For instance, Samsung’s Gear A smartwatch only works with Samsung Galaxy series smartphones, and the Apple Watch only works with iPhones. As a result, current smartwatches available from mobile device manufacturing companies are more like smartphone accessories than standalone devices since they require access to a compatible smartphone to relay additional useful information to their owners.
• Smartwatches are seeing a surge in new users, including the older population, because wearable makers, such as Apple and Fitbit, are adding health-monitoring features that appeal to older people and keep them updated about their health status in real-time. For instance, Apple features a fall detection app and an EKG monitor on Apple Watch Series 4, while Fitbit added a feature to detect sleep apnea. The next generation of Apple watches is expected to feature glucose monitoring for people with diabetes. The company also collaborated with L’Oreal to design the first skin sensor that detects UVA and UVB exposure. Consumers are trending toward connected monitoring devices, spurred by the COVID-19 pandemic, and this trend has been expected to ramp up in 2021.
• According to the Consumer Technology Association, US tech industry revenue will reach a record-breaking USD 487 billion in 2021, a 7.5% y-o-y jump. Moreover, Smartwatches demand is expected to grow by 8% in unit shipments, driven by tech-savvy and fashion-conscious consumers.
• Fitbit’s advanced smartwatch can track heart rate, SpO2, and skin temperature, with the company now investigating whether it can measure blood pressure with a new study for Sense owners. Fitbit Labs launched a blood pressure study in April 2021 to potentially measure Pulse Arrival Time (PAT), or the time it takes for a pulse of blood to reach the wrist after one’s heartbeats. Through such developments and research, the company wants to explore the potential link to tracking blood pressure and needs a wider data set.
• Moreover, patients tend to forget to take their medications for many reasons. Wearables can play an important role by alerting people when it is time to take their medicines and can keep track of when they take them. Such trends are expected to drive smartwatch adoption in medical applications among individual users during the forecast period.
• However, the concern over data privacy still persists. Moreover, for smartwatches, the target consumers are individual people, where awareness of data security is relatively low compared to enterprises. Even though data from smartwatches are not information-rich, risks are likely to increase further if the device comes with support for internet connectivity, as they can be operated away from the paired device. Payment services in such cases can be misused.

Key Market TrendsThe Sports Segment to Account for a Significant Market Share

• Smartwatches are increasingly becoming a key wearable fitness technology. Users are connecting them to different apps to track various types of data. Most of the time, a smartwatch can also be used as a tracking device, lowering the barrier of access and offering a great user experience. This is why smartwatches are expected to become a critical part of the industry soon.
• In June 2022, Boat launched the Xtend Sport smartwatch, an upgraded version of the Boat Xtend. The company has been on a launch spree lately. After dominating the budget audio market, the company now aims to dominate the budget smartly. Such innovations and expansions will leverage the studied market in the sports industry.
• The impact of technologies on recent advancements in the fitness industry laid the foundation for stakeholders in smartwatch devices. Monitoring is a critical focus area of the market. It is witnessing an increasing integration of intelligence into smartwatch devices, offering real-time insights based on the individual's data. New features in smartwatches with time schedules offer to track physical activities, due to which the growth in the smartwatch devices is expected to witness a comparatively high growth rate. The growing investments by numerous smartwatch vendors to eliminate any preventable injuries of highly paid professional athletes are anticipated to fuel the number of smartwatches developed for professional usage.
• For instance, Qualcomm offers its made-for-wearables processor, Snapdragon Wear 3100. The processor is very prominent across many smartwatches in the market. The processor was designed to maximize battery life and utility in various scenarios. Watchmakers such as Fossil Group, Louis Vuitton, and Montblanc use the Snapdragon Wear 3100 in their smartwatches.
• Furthermore, launching new products with enhanced features by prominent vendors worldwide is expected to drive market growth. For instance, in June 2021, Garmin International Inc. announced its latest creation, the Forerunner 945 LTE, a premium GPS running and triathlon smartwatch with LTE connectivity. The watch was designed to help athletes stay connected on the go. The watch also brings phone-free safety and tracking features, spectator messaging, and live event sharing to the wrist while providing the detailed training data, performance monitoring tools, and smartwatch features that the athletes today have come to rely on.

Asia Pacific Region is Expected to have Significant Growth

• Asia-Pacific is expected to witness the highest growth in the smartwatch market, owing to the growing consumer electronics industry and the rapid rise of smartwatch market vendors across the region's emerging economies. The increasing tech-savvy population, a rising pool of chronic diseases, such as obesity and diabetes, and the growing popularity of health and fitness to maintain a healthy lifestyle drive the market growth.
• Smartwatches and smart wristbands are becoming popular, with nearly 70% of Chinese smartwatch owners owning a wristband. Local smartwatch brands responded promptly to this trend and snapped up most of the market share. There is an opportunity for western brands to copy from China and establish leading positions in their home markets.
• Moreover, in April 2021, Casio Computer Co. Ltd. announced the release of the GSW-H1000, a G-SQUAD PRO smartwatch powered by Wear OS by Google and packed with functions designed to assist users in achieving their activity goals and utilizing fitness tracking features. The GSW-H1000 is oriented toward usage in a wide range of athletic settings, including activities, like running, indoor workouts, road biking, swimming, surfing, and snowboarding.
• Vendors operating in the Indian market are also launching new products with attractive prices and multiple functions to lure consumers towards their offerings. For instance, Aug 2021, In base launched its latest smartwatch Urban Sports. The new smartwatch comes with 45 days of standby battery life. The smartwatch primarily expands the affordable range of smartwatches available in the country.​
• Some of the ongoing partnerships and collaboration among the prominent players across the region are further expected to expand the scope of the market studied during the forecast period. For instance, Huami Corporation partnered with PAI Health, which is a health technology software company, to combine Huami's massive biometric database collected by the high-quality smartwatch devices and powerful algorithms, along with PAI Health's software to offer a scientifically validated approach to help address some of the health risks that are associated with an inactive lifestyle.

Competitive Landscape

The smartwatch market is a fragmented market, and therefore companies are banking on product innovation and product development to gain an edge and the number of local players. This makes the rivalry intense in the market. Key players are Apple Inc., Fitbit Inc., Samsung Electronics Co. Ltd, among others. Recent developments in the market are:

• June 2022 - In India, Garmin unveiled its new and one of the world's first GPS running smartwatch 955 with solar charging and forerunner 255 series in India. The latest additions to Garmin's Forerunner range, the preferred choice of runners worldwide, are triathlon-ready smartwatches equipped with an collection of training features developed for professional and mid-level runners and athletes.
• May 2022 - Huawei Consumer Business Group announced various cutting-edge hardware products at the Huawei flagship product launch in 2022, including HUAWEI Mate Xs 2, HUAWEI WATCH GT 3 Pro, and HUAWEI WATCH FIT 2, HUAWEI Band 7, HUAWEI WATCH D, and HUAWEI S-TAG aiming to simplify the daily lives of consumers. Further, the company also features its world-renowned Health App, which has aided consumers all around the world lead a healthy lifestyle.

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