Total, a complete of 18.9 million smartwatches had been shipped within the first half of 2024, 18% lower than the 23 million items that had been shipped within the first half of 2023. The stress within the sector got here from unsold stock of smartwatches, in addition to stagnant innovation within the sector resulting in patrons not being involved in buying new units.
This has additional led to a decline within the common promoting costs (ASPs) of smartwatches. Within the first half of 2024, the smartwatch market in India registered ASPs of ₹1,700—23% lower than ₹2,300 in the identical interval a yr in the past. This, the IDC report mentioned, occurred “attributable to worth cuts to clear stock, and reductions and provides by manufacturers.”
Vikas Sharma, senior market analyst for wearable units at IDC India, mentioned that the stagnation out there partly occurred in anticipation of the competition interval. “A number of new mannequin launches by incumbent manufacturers are anticipated in the course of the upcoming festive season, which can assist in arresting this decline. Nevertheless, the annual shipments for smartwatches are anticipated to say no by 10% in 2024. We may even probably see refreshed smartwatch portfolios by the smartphone distributors at low to mid-price segments,” Sharma mentioned.
Smartwatch market considerations
Market stakeholders, nonetheless, are involved concerning the total stature of the business.
Sameer Mehta, co-founder and chief govt of Think about Advertising—which operates the model ‘Boat’ in India—mentioned that the decline in smartwatch demand is largely attributable to a worth warfare within the business.
“The smartwatch business confronted appreciable pressures from manufacturers trying to construct scale and quantity on the expense of margin. Now, patrons have slowed down upon the need to spend on smartwatches on a funds, which can add the onus on Indian companies to make higher, extra premium merchandise,” Mehta mentioned.
A senior business guide informed Mint on situation of anonymity that the slowdown was largely anticipated owing to the way in which the market developed prior to now three years.
“In case you look intently, there was an excessive worth warfare between a number of manufacturers in India, which began pushing the common worth of smartwatches all the way down to a near-ridiculous margin. This was by no means going to be sustainable, and lots of manufacturers had been even promoting smartwatches at lower than ₹1,000. This was not solely leaving India’s smartwatch manufacturers with low margin—it left them with no margin. Consequently, manufacturers had been left with little or no area to innovate, and at a super-inexpensive pricing, there was all the time a ceiling that the manufacturers would hit,” the guide mentioned.
In the long term, the guide additional added {that a} technique to push for extra premium merchandise will “add worth to patrons, even at increased costs.”
“An enormous section of India’s smartphone customers are right this moment on the lookout for a premium smartwatch expertise, one thing a model like OnePlus has offered. Flagship items from Samsung or Apple aren’t reasonably priced for all, however they’re what most patrons aspire for. This offers India’s manufacturers an enormous alternative to money in on, and a premium market technique, comparable to what Boat is trying to do, might outline the business going ahead,” he additional added.
Mehta, on this notice, additional added, “Going ahead, we’re taking a look at a brand new product technique the place we’ll give attention to extra modern smartwatches that provide patrons higher experiences, and in flip, better worth.”
Smartwatch market overview
To make sure, 4 out of the highest 5 smartwatch manufacturers in India—Noise, Hearth-Boltt, Boat and Boult—registered double-digit y-o-y declines in shipments. Gupta, on this notice, affirmed that the model is assured of reviving shipments within the upcoming festive season.
The one outlier that noticed a spike in shipments of smartwatches is equipment main Titan, whose cargo spiked by practically 69% y-o-y.
The market, nonetheless, might enhance within the close to time period. Boat’s Mehta added, “The demand is predicted to rise within the festive season—which might drive better gross sales and a much bigger alternative for us.”
IDC’s Sharma, too, concurred, anticipating a lift from the upcoming competition season.
