The popularity of wrist-worn devices - including watches and wrist bands, will continue to drive the wearables market with double-digit gains forecast through 2021.
This is according to IDC'sWorldwide Quarterly Wearable Device Tracker, which predicts vendors will ship a total of 121.7 million wearable devices this year, marking a 16.6% increase from the 104.4 million units shipped in 2016. The wearables market is forecast to maintain this pace of growth with shipments reaching 229.5 million units in 2021, resulting in a five-year compound annual growth rate of 17.2%.
"We expect the most innovation and development in the wearables market to take place on the wrist," says Ramon T Llamas, research manager for IDC's Wearables team. "It's the ideal location for users to collect, view, and interact with data and applications, and the point to execute tasks like responding to notifications or communicating with other people and devices. Layer on top of that varieties in style, design, segment, and feature set, and wrist worn wearables are poised to remain well out in front of the market."
Outside of wrist-worn wearables, IDC also anticipates smart clothing and earwear - though small in volume and market share - will develop quickly as innovative feature sets emerge. Earworn wearables with personal assistants built in or clothing that tracks your vital signs and transmits them to your doctor can be very powerful solutions for health issues and clearly there will be plenty of possible use cases, notes ICD.
According to research conducted by M2M/IOT market research provider Berg Insight, total shipments of connected wearables consisting of smartwatches, smart glasses, fitness and activity trackers, people monitoring and safety devices, smart clothing and medical devices as well as other wearable devices, are expected to reach 262.5 million units in 2021.
A Gartner report found sales of global wearable devices will generate revenue of $30.5 billion in 2017; of that $9.3 billion will be from smartwatches.
"Smartwatches are on pace to achieve the greatest revenue potential among all wearables through 2021, reaching $17.4 billion," says Angela McIntyre, research director at Gartner.
"The overall average selling price of the smartwatch category will drop from $223.25 in 2017 to $214.99 in 2021, as higher volumes lead to slight reductions in manufacturing and component costs, but strong brands such as Apple and Fossil will keep pricing consistent with price bands of traditional watches."
Other factors fuelling growth in the wearables market will be the inclusion of cellular connectivity along with improved sensors and algorithms. Not only do these technologies provide increased accuracy, but they also make it possible for companies to sell wearables through new channels and more importantly, to new customers, says IDC.
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