As per the recent report from the International Data Corporation (IDC), India’s wearables market faced a significant downturn in the second quarter of 2024. The report revealed that around 10 per cent year-over-year decline was witnessed in the shipments, a marked shift from the sector's earlier growth trajectory. This drop in signal has emerged as a challenge for both manufacturers and retailers within this once-thriving market.
Shipment decline and contributing factors
- In Q2 2024, wearables shipments in India dropped to 18.3 million units, down from 20.4 million units in the same quarter the previous year.
- The decline can be attributed to multiple factors, including waning consumer demand, market saturation, and stiff competition from global and local brands offering cheaper alternatives.
- As wearables become more common, the once-high growth rate appears to be stabilizing, particularly in urban markets where adoption is already high.
Smartwatches still lead, but growth slows
While smartwatches continue to dominate the wearables market with a 60 per cent share, their shipments have fallen too. The smartwatch category has been the fastest-growing segment in recent years, driven by features like advanced health tracking, fitness monitoring, and seamless smartphone integration.
However, the rising preference for feature-rich smartwatches over basic fitness bands has caused a sharper decline in fitness band sales. These simple trackers are losing appeal as consumers gravitate toward devices offering more functionality at competitive prices.
Inflation and economic uncertainty
The IDC report further points to economic uncertainty and rising inflation as key factors dampening consumer spending on non-essential gadgets like wearables. While brands continue to introduce new features such as health sensors, voice assistants, and enhanced battery life, these innovations have not been enough to drive growth in a saturated urban market.
Consumers are holding back on discretionary spending, especially on products deemed non-essential.
The path forward: Innovation and rural expansion
- Industry experts further suggest that to reignite consumer interest, manufacturers must focus on innovation. This includes integrating more advanced health monitoring capabilities, increasing device durability, and improving battery performance.
- Experts further highlighted the untapped potential of rural markets as a promising avenue for growth. These areas offer a new customer base that, while less familiar with wearables, presents significant expansion opportunities.
- To capture these markets, brands will need to adjust their pricing strategies and perhaps tailor their marketing to emphasize affordability alongside innovative features. More localized campaigns and education about the benefits of wearables could help boost adoption in these regions.
Future outlook
As India’s wearables market navigates through these challenges, the next few quarters will be critical for brands. Those that can effectively innovate and expand into untapped areas may find new opportunities to regain market momentum. However, it will take a combination of technological advancement, competitive pricing, and strategic market expansion to reverse the current decline.
In a competitive landscape where consumer preferences are rapidly evolving, wearable brands must remain agile and responsive to market trends. Success in the future will depend on how well companies can balance innovation with affordability while broadening their reach beyond saturated urban markets.
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