The wearable tech market might be maturing, but it will never compete with the smartphone sector
Some technology experts believe wearables will be the next big consumer technology, with an impact similar to that of the smartphone. This is largely nonsense: wearables just do not have the same breadth of functionality to deliver the diverse range of services available on smartphones. However, the wearables market is still an interesting segment, which is growing differently in Asia-Pacific (APAC) than the rest of the world. Demand for fitness trackers is growing in APAC, while their sales in North America and Europe are declining. Smartwatches are gaining traction, but driven by the emergence of low-cost Chinese products. In terms of regulations, APAC is still far from adopting the EU’s GDPR standard, which makes the region an attractive market for wearable vendors keen to exploit customer data.
Competition in wearable tech is primarily a face-off between US and Chinese tech giants. Apple is the dominant player, thanks to the success of the Apple Watch, and its strong position in the wearables segment, where AirPods are the market leader. Smartwatches are now the dominant wearable tech segment, while fitness trackers promising much less today than they did four years back. Fitness trackers are losing out to smartwatches when it comes to sales, but daily usage rates (at least in mature economies) are on the rise. Many fitness tracker companies are exploring growth opportunities in healthcare services. Google’s acquisition of Fitbit in 2019, in some parts, is attributed to the Fitbit’s stronghold in the US healthcare services market.