Huawei rides high as wearables market shifts gears
One of the standout performers in this evolving landscape is Huawei with the Chinese tech giant experiencing significant growth in the wrist-worn market, ranking first in shipments globally for the first three quarters of 2024.
Huawei's surprise success in the face of US sanctions delivers on a strong global strategy that resonates with diverse consumer bases.
The recent release of the GT5 and GT5 Pro smartwatches, as well as the second-generation blood pressure monitor Watch D2, featuring the new TruSense System, has significantly enhanced the user experience in health monitoring with the Watch GT 5 family in particular becoming a viable alternative to premium Garmin devices
Huawei has also aggressively expanded its presence in the Asia-Pacific, Latin America, Middle East, and Africa markets through a focused localisation strategy and impactful marketing campaigns.
Influencer marketing pays off
A key element of this strategy has been the new crop of globally recognised figures like Sir Mo Farah, Tatjana Smith, and Pamela Reif as product ambassadors.
These partnerships, combined with major product launch events in cities like Dubai, Barcelona, and Brazil, have created significant buzz and strengthened Huawei's connection with consumers worldwide.
The company has also turned to its traditional cribbing of Apple’s homework with the Light Up Your Rings social media campaign a direct copy of the Apple Watch Close Your Rings concept.
Huawei is also playing hard on its “commitment to developing technology that is not only innovative but also deeply human-centred, providing users with meaningful health solutions”.
Smartwatch slowdown
While the overall wearables market is growing, individual segments are experiencing varying degrees of success.
Smartwatches, the second-largest category, is expected to decline by 4.5% when all 2024 data is in.
This is due in part to market saturation in India, which saw an oversupply of low-cost options, impacting average selling prices (ASPs).
The US market is also experiencing a dip as consumers continue to use devices purchased during the pandemic.
However, a rebound is expected in 2025 as the refresh cycle begins, with a projected 1.7% growth.
Hearables (earphones) have remained the largest category with projected growth of 10.3% fuelled by emerging markets, product refresh cycles, and innovations like open-ear designs, coupled with decreasing ASPs.
The finger and face frontier
IDC's report highlights the growing importance of smart rings, which are gaining traction as alternative or complementary health trackers, particularly as some smartwatch vendors explore this segment due to slowing growth in their core market.
Meta's success with Ray-Ban has spurred interest in smart glasses, especially in China, where the absence of Meta creates opportunities for local brands.
China also retains its crown as the largest market for wrist-worn devices, with shipments reaching 45.8m units in the first three quarters of 2024, a 20.1% year-over-year increase.
Smartwatches had the lion’s share with 32.9m units shipped, up 23.3% year-over-year with wristbands trailing at 12.9m units shipped, up 12.6% year-over-year.
Changing needs
“The rate of technological innovation among smartwatches along with consumer interest has certainly slowed in recent quarters leaving vendors to innovate across price points instead,” said Jitesh Ubrani, research manager, Mobility and Consumer Device Trackers at IDC.
Providing options both up and down the pricing ladders will likely be a key strategy for many vendors going forward along with a potential loosening of paywalled features to entice upgrades or new users.
Younger demographics (18-34) are driving the adoption of smartwatches and fitness trackers, while older demographics (55+) show increasing interest in health monitoring features.
For example, in the US, smartwatch adoption is at 35% for those aged 18-34, compared to 20% for those aged 55+, with women showing a slightly higher adoption rate for fitness trackers across all markets.
Price sensitive
IDC's Sophie Pan highlights that the wrist-worn market is increasingly driven by price and channel strategies, with manufacturers segmenting their product lines to cater to wider audiences.
The wearables market is at a fascinating inflection point.
While traditional form factors like smartwatches face challenges, new categories are emerging, and the overall market continues to grow.
