India's wearables market is expected to end 2023 as the world's largest and is set to prop up the global demand for smartwatches and hearables, at a time when North America and China are showing signs of saturation amid macroeconomic headwinds.
Of the total 504.1 million units of wearables forecast to be shipped worldwide this year, India is expected to account for 130-135 million, or around 26%, as per market research firm IDC India. Last year, India had shipped around 100 million units of wearables - behind China and North America - making up nearly a fifth of the 492-million-unit global shipments,IDC said. On a quarterly basis, the wearables market in India became the largest globally in January-March this year, accounting for 26% of global shipments, according to IDC India, and 27%, as per Counterpoint Research.
Both firms attributed the India growth to its lower penetration and attach rate, or the number of smartphone users owning a wearable, with respect to smartphones as compared to other regions.
Counterpoint said currently, for every smartphone sold, one smartwatch is also sold in India.
Both market trackers expect India to maintain its growth momentum in the segment through 2023.
"India has already surpassed the United States and China in terms of market size and will remain the largest market going forward thanks to the breadth of low-cost yet feature-rich devices from local vendors," IDC research manager Jitesh Ubrani said in a report.
India's fast growth - estimated up to 35% in 2023 by IDC and around 56% by Counterpoint - will enable the global shipments of wearables to rebound after declining for the first time ever in 2022. Thus, India will help the world's wearables market to grow at 2.4% on-year this year, IDC said.
"Looking ahead, IDC expects the (global) market will see several years of single-digit growth with shipments reaching 629.4 million units in 2027, resulting in a compound annual growth rate of 5%," the research firm said. It said China and the US would be the second and third largest markets, respectively, in 2023.
Counterpoint predicts both North America and China markets to likely remain flat or shrink this year.
To be sure, the India market is different from North America and China in terms of maturity, product offerings and pricing, said IDC researcher Upasana Joshi.
While the India market is dominated by low-cost, basic offerings, North America and China are driven by wearables with higher average selling prices and powered by high-level operating systems such as Apple's WatchOS and Google's Wear OS.
IDC said smartwatches like those from Apple, Samsung and Google will face a challenging environment in 2023, as the pricing of many have risen during a tough macroeconomic climate, with even discounts not enough to offset the impact of inflation and foreign exchange rates.
In contrast, the average selling prices (ASPs) in India are expected to decline even more, after being the lowest across all regions, IDC said. It forecasts India ASPs to fall to $23-25 this year from $27 in 2022.
Read more at: https://economictimes.indiatimes.com/industry/cons-products/electronics/india-set-to-be-no-1-wearables-market-in-2023/articleshow/101442211.cms
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