Global Wearables Market on Track to End 2021 with 27% Growth

The global wearables market is forecast to end 2021 on a high, achieving year-on-year volume growth of 27% according to a new report from Futuresource Consulting. That’s despite widespread chip shortages and broader supply side issues.

“Wearables continue to ride the crest of the consumer wave,” says Guy Hammett, Senior Market Analyst, Futuresource Consulting. “It’s a category that never ceases to attract affection from a wide range of socioeconomic groups. For many it’s a lifestyle choice, and uptake is only going one way – skywards. There’s also a general industry consensus that the pandemic has increased people’s awareness of the importance of health and fitness, adding more pace to the forward momentum.”

Hearables Dominating the Action

Hearables continue to dominate the wearables landscape. Futuresource expects the segment to account for 63.5% of total market shipments this year, with True Wireless leading the charge.

“True Wireless has single-handedly opened the door for hundreds of millions of people to enter the headphone aftermarket,” says Hammett. “It’s also dramatically increased the price that consumers are willing to pay for their headphones.”

While the key use case for hearables is currently audio playback, the ear represents an attractive alternative to the wrist for many biometric measurements. Futuresource expects ear-based health and fitness tracking to become increasingly common during the forecast period, though this is likely to work in tandem with wrist worn wearables rather than act as a replacement device.

The Wearables World Beyond Hearables

Looking beyond the hearables segment, smartwatches, sports watches, wireless watches and wearable smartphones are all experiencing notable growth.

As a whole, Futuresource expects the wrist-worn wearables market to achieve shipment growth of 12.2% in 2021. Although smartwatches command the number one position for wrist-worn wearables, wearable smartphones have seen the largest growth rate. Dominated by kids' smartwatches, but also comprising personal independence watches and general-purpose wearable smartphones, the segment will expand by 25% in shipment terms.

Smartwatches Adopt Medical Grade Tech

Smartwatches have retained their lead position in the wrist-worn wearables segment, on track to account for 43.5% of total wrist-worn shipments this year according to Futuresource. The research firm expects the figure to rise to more than half of all wrist-worn shipments by 2025.

“Smartwatches are becoming increasingly sophisticated,” says Hammett. “Vendors are offering ever more accurate tracking, employing machine learning algorithms to mine a wealth of useful and actionable feedback to consumers. Leading smartwatches now boast medical grade ECGs, and algorithms will get progressively smarter as the installed base of wearables grows and the amount of data collected skyrockets.

“Moving forward, we’re going to see devices that offer continuous blood pressure monitoring, delivered with an accuracy that’s comparable to a blood pressure cuff. Many vendors even have an eye on non-invasive continuous blood glucose monitoring as a feature within the next few years.”

A New Dawn for VR?

This year has also provided a seat at the table for VR. Meta’s Oculus Quest 2 has proved to be a breakout product, shipping significantly more units than any other previous non-mobile VR head-mounted display. With the metaverse perhaps the hottest topic in tech at the moment, this market finally looks poised to pick up the pace.

Futuresource expects the HMD market to achieve shipment growth of 38% in 2021, to reach 25 million units.

The View from the Brands

Looking to the brands, Apple retains its position as the frontrunner, on track to account for nearly one in every four wearables shipments this year. The tech giant’s dominant position in smartwatches and hearables gives it an enviable lead over its nearest wearables rivals Xiaomi, Huawei and Samsung.

A Rewarding Future for Wearables

Futuresource expects this year’s volume growth to translate to a global market value of $76 billion at retail. Growth is forecast to continue apace, achieving a 19.4% CAGR between 2021 and 2025, resulting in annual revenues of $153 billion by the end of the forecast period.

For further information or to purchase the wearable technology market report from Futuresource Consulting, please contact Kailash.morjaria@futuesource-hq.com