Wearable shipments grow 20% in the March quarter, watches see 173% surge

India shipped 13.9 million wearable devices including watches, wristbands, and earwears in the first quarter of 2022, growing at 20.1% year-on-year (YoY), reported International Data Corporation  (IDC) on May 16. Watches was the fastest-growing category with a 173.0% YoY growth. IDC attributes the growth to “new launches, discounts across channels, and aggressive marketing by brands.” 

The average selling price (ASP) of wearables declined by 17.1% YoY, due to a decline in the ASP of watches, which fell by 41.5% to reach $50.3 in the first quarter from $86, a year ago. 

Upasana Joshi, Research Manager, IDC India believes that the ASP may decline even further due to the production linked incentive (PLI) scheme for wearables. Mint reported last December that several India brands including boAt and Noise had started making wearables through contract partners in India. 

“With the PLI scheme for wearables announced by the government, key players in the ecosystem have begun foraying into local manufacturing of these devices and launching ‘Made in India’ products, possibly leading to further lowering of the ASPs,” she added. 

Basic real-time operating system (RTOS) watches by the likes of boAt and Noise that can run limited apps accounted for 95.1% of the shipments growing at 202.1% under the watches category. Meanwhile, the shipment of smartwatches, which includes watches by the likes of Apple and Samsung, declined by 4.2% YoY, according to IDC. 

Shipment of wristbands continued to decline for the 9th consecutive quarter, as more buyers are migrating from them to watches for more features and a bigger screen. The combined shipment of watches and wristbands was 4 million units in the first quarter. 

Though watches was the fastest-growing category, earwear accounted for 71.3% of all shipments in the wearables in the quarter. The growth rate for earwear was only 4.2%. However, within earwear, truly wireless stereo (TWS) that can be plugged into the ear and work wirelessly via Bluetooth, grew by 48.2%. Its market share grew from 48.3% to 34.2% during the quarter.

"Intense competition in the sub $50 category is pushing all brands to offer competitive offerings in terms of pricing, features, and device design," said Anisha Dumbre, senior market analyst, Client Devices at IDC India.

Dumbre said that the dependence on devices like TWS and wearable watches is increasing. However, "supply remains a concern for the industry," she added. 

In terms of the brand's share of total shipments of wearables, New Delhi-based Imagine Marketing, which sells its earwears and watches under the boAt brand finished the quarter as the market leader with a 22.9% share, growing at 5.2% YoY. 

Gurugram-based Nexxbase, which sells products under the Noise brand grew at a much higher 150.1% YoY and was the second leading brand with a 10.9% market share in wearables. 

Chinese brand OnePlus, which has also added watches and bands to its portfolio, finished third with a 7.4% market share, even though its shipments declined by 35.8%.

Fire-Boltt and Realme occupied the fourth and fifth positions in wearables with a 6.6% market share for both. 

Mumbai-based Fire-Boltt was the fastest growing brand in wearables as its shipments grew 1,522.2% YoY during the quarter. 

According to IDC, growth in wearables is attracting newer players to the market. 

Joshi believes the wearables market will continue to see strong growth in the second quarter as well during the second half. 

"The aggressive offers, sales, and marketing around the festive season in 2H 2022 are expected to continue this growth momentum through the year for the wearable device categories," she added.