The demand for smartwatches, earphones, and similar gadgets has declined among Indian consumers, leading to a contraction in the wearable device market for the second consecutive quarter. According to IDC, during the July-September timeframe, sales of wearable devices reached 38 million units, reflecting a 20.7 percent decrease compared to the same period last year. This decline is attributed to a reduction in product launches and a more cautious approach to inventory management during the festival season.
Notably, for the first time since the second quarter of 2019, the average selling price (ASP) of wearables has risen, increasing by 1.3 percent to $21.3 (approximately Rs 1,800) in Q3 2024.
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The Smartwatch market dips deep
Smartwatch shipments experienced a significant decline of 44.8 percent year-over-year, totaling 9.3 million units. Manufacturers concentrated on reducing inventory by offering substantial discounts, especially on online retail platforms.
The average selling price (ASP) for smartwatches saw a modest increase of 1.4 percent, rising from $25.8 to $26.2. Although advanced smartwatch shipments dropped by 39.9 percent, their market share grew slightly from 2.4 percent to 2.6 percent.
In the earwear market, shipments decreased by 7.5 percent year-over-year, reaching 28.5 million units. Within this segment, Truly Wireless Stereo (TWS) products captured a record 73.2 percent market share, despite a minor decline of 0.7 percent year-over-year.
Other earwear categories, including wired and over-ear models, saw a 22 percent reduction in shipments, totaling 7.6 million units. The average selling price for these products increased by 5.9 percent to $19.2.
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Noise (Nexxbase) continued to dominate the smartwatch market, whereas boAt (Imagine Marketing) concentrated on inventory clearance during the festive sales period. Among the leading five brands, Boult and Realme were the sole companies to experience growth, achieving increases of 32.5 percent and 56.5 percent, respectively.
In the TWS sector, Boult and Realme reported impressive growth rates of 55 percent and 94.6 percent. Additionally, the smartphone brand Nothing made remarkable progress, with a year-over-year growth of 308.2 percent in the overall wearables market.
Offline grew while Online slumped
The offline channel for earwear shipments experienced a year-over-year growth of 9.4 percent, resulting in an increase in its market share from 29.1 percent to 34.4 percent during the quarter, while online shipments saw a decline of 14.4 percent. In the smartwatch category, online channels have shown growth for the third time in a row as it managed to strike a 63.8 percent market share in the third quarter.
Conversely, shipments from lesser-known brands, including white-label products, plummeted by 59.1 percent year-over-year after a remarkable increase of 328.8 percent in Q3 2023. Anand Priya Singh, a market analyst for smart wearable devices at IDC India, noted that the demand for smartwatches has decreased in 2024, which has had a significant effect on these smaller brands.
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The smart ring market continued its upward trend, with shipments exceeding 92,000 units during the quarter. The average selling prices (ASPs) for smart rings fell by 16.2 percent year-over-year, reaching $162.1.
Ultrahuman dominated the market with a 36.8 percent share, followed by boAt at 20.5 percent and Pi Ring at 16.3 percent. Anticipated price reductions and new product launches are likely to further stimulate growth in this sector.
In contrast, the smartwatch market is encountering difficulties due to a lack of product differentiation and a limited number of active brands, according to Vikas Sharma, a senior market analyst at IDC India.
He predicts that the market may remain stagnant or experience a slight decline in 2025, but he also highlights a growing trend of consumers transitioning from basic to more advanced smartwatches, driven by increasing demand for superior health tracking and enhanced functionalities.
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