IDC: Pandemic shifted consumer spending to wearables market

The analyst firm IDC has reported that 444.7 million wearables units were shipped in 2020, representing an increase of 28.4% compared to 2019; according to IDC, this was a result of lockdowns which caused people to build up more disposable income. IDC also said the market saw a year-over-year increase in 4Q20 of 27.2% driven by the availability of new devices and reduced prices.

Commenting on the findings, Jitesh Ubrani, a research manager at IDC Mobile Device Trackers, said:

“While the shift in spending along with new products and typical seasonality were at play during the fourth quarter, the pandemic has also been good for the market as it has put health and fitness at the forefront of many consumers’ minds. In-home fitness programs are quickly becoming a crucial component of the wearables offering for many companies. Beyond that, the proliferation of health sensors such as skin temperature, ECG, and heart rate tracking are allowing users and health professionals to better understand the onset and tracking of diseases.”

In the wearables category, IDC includes devices such as smartwatches, wristbands, and earwear (dubbed hearables where the device comes with functionality beyond audio playback). Surprisingly, hearables accounted for the most wearables sales during the fourth quarter representing a 64.2% share of shipments, watches represented 24.1% of the market, and wristbands represented just 11.5% due to semiconductor shortages.

By the fourth quarter, Apple was the clear market leader in wearables with a 36.2% market share. Behind Apple were Xiaomi (8.8%), Samsung (8.5%), Huawei (6.7%), and BoAt (5.4%) - which only operates in India.

On the Apple-front, Watch shipments rose to 45.6% because customers can buy in at various price points; Apple is currently selling the Series 6, Watch SE, and Series 3. Apple’s hearable products also saw a surge in the fourth quarter but year-over-year growth has slowed down compared to the two previous quarters.

It’ll be interesting to see whether consumer spending on wearables continues as more and more people get vaccinated and countries begin to think about loosening lockdown restrictions.