Wearables Market: Fitness Trackers Sell, but Smartwatches are the Future

TL;DR

Xiaomi takes the lead in wearables market, Fitbit remains #2, and healthcare becomes a core focus for wearable tech.

Transcript

Dylan Lewis: Evan, not to be outdone on the news front, we have some fresh data from market research firm IDC on wearables and VR. I really love checking these out. I think it's a great at-a-glance for what's going on in the consumer tech space. This firm does such a good job giving people the 5,000-foot view. Evan Niu: These are really exciting ma... Read More

Key Insights

• 🫓 Basic trackers experienced growth in emerging markets, while the U.S. market remained flat, emphasizing the importance of affordable options.
• 🇫🇲 Xiaomi overtook Apple in wearables market share due to the success of their basic tracker, the Mi Band 3.
• 🖤 Fitbit secures the #2 position in the smartwatch market, benefiting from the lack of competitive alternatives to the Apple Watch.
• 🧑‍⚕️ Healthcare is a major focus for wearable tech companies, with Apple and Fitbit working on building robust digital health platforms.
• 🛀 The long-term trend shows a shift towards smartwatches as the price difference between basic trackers and previous generation smartwatches decreases.
• 🫵 Consumers view smartwatches as a more valuable investment, as they offer more capabilities and better health data collection.
• 🧡 The wearable tech market offers a range of options for consumers, with basic trackers being more popular in emerging markets and smartwatches dominating in developed markets.

Questions & Answers

Q: How did Xiaomi manage to overtake Apple to become the leader in the wearables market?

Xiaomi's Mi Band 3, a basic tracker, sold exceptionally well in the third quarter, helping the company claim the top spot. Apple's Series 4 Apple Watch launch came late in the quarter, allowing Xiaomi to gain momentum.

Q: What is the market position of Fitbit in the smartwatch market?

Fitbit has become the #2 player in the smartwatch market, mainly due to its more affordable Versa smartwatch. The IDC expects Fitbit to maintain this position as Android Wear OS devices fail to compete with Apple Watch.

Q: How important is healthcare in the wearable tech market?

Both Apple and Fitbit are prioritizing healthcare in their digital health platforms. The race to develop the most advanced and comprehensive platform is ongoing, with Apple having more financial resources to invest.

Q: How do low-end and high-end devices factor into the health solutions offered by wearable tech companies?

Basic trackers have limited data collection capabilities, whereas smartwatches offer more advanced features. As smartwatch prices decrease, the gap between basic trackers and smartwatches narrows, leading more consumers to opt for smartwatches with better health platforms.

Summary & Key Takeaways

• Basic trackers, like Fitbit, returned to growth due to new product launches in emerging markets, while the U.S. market remained flat as it transitioned towards replacements and upgrades.

• Xiaomi surpassed Apple to claim the #1 spot in the wearables market with its Mi Band 3, but Apple still leads in smartwatches with the launch of the Apple Watch Series 4.

• Fitbit maintains its #2 position in the smartwatch market, benefiting from the lack of competition from Android Wear OS.

• Healthcare is becoming an essential aspect of the wearable tech market, with both Apple and Fitbit focusing on developing robust digital health platforms.