Wearable tech: Sales (and prices) rose in US last year

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Mica by Opening Ceremony/Intel

We’re all finally switching on to wearable tech. That’s the conclusion of a new report from researchers at The NPD Group. In the US last year, dollar sales of wearables rose 110%, which is pretty impressive. And it’s shaping up as a battle royal between fitness trackers and smartwatches. One of them is winning for now, but this year could change all that.

The stats

OK, a rise in average selling prices (ASPs), from $96 to $109, helped last year’s sales to rise. But volume sales were up too: by an equally-impressive 85%. So not only are we more likely to buy a piece of wearable tech now, but it looks like we’re happier to pay more for it too.

“The increase in ASP speaks to these devices becoming more sophisticated, and that consumers are looking for better-quality devices, not just entry-level products,” said NPD’s executive director and industry analysts Ben Arnold. “This, combined with unit growth, shows that prices aren’t falling to drive demand; demand is increasing along with rising prices.”

fitbit

Fitbit

Fitbit remained the leading brand in connected activity trackers in 2015, accounting for 79% of sales. The company has been the market leader in connected activity trackers since 2014, growing market share by more than 20 points since that time despite the entrance of new competing products in the wearables category.

Arnold said a lot of factors were coming together to make fitness trackers the category in wearable tech, from consumers simply being more aware of such products’ existence, to new designs and colours that are making them more appealing.

The smartwatch issue

But what we all want to know is whether smartwatches have reached the point where they can be considered a big category in wearables. Surely they must have done with everyone seeming to make on these days and Apple getting in on the act?

NPD said that while the smartwatch category continued to gain in popularity due to the Apple Watch launch in April last year, overall ownership growth has continued to trail the more mainstream fitness tracker category.

apple watch

Apple Watch

According to the latest NPD Connected Intelligence forecast numbers, fitness tracker ownership in the US market stood at nearly 33m devices at the end of Q4 2015.

But smartwatch ownership (which includes devices that are basically traditional watches with some smartphone notification features added-on) were less than 13m. Hmmm, 13m? Maybe that’s not so bad for a product that consumers remain to be convinced that they want or need.

On the upside, NPD said consumers are actually more aware of smartwatches than they are of fitness trackers (83% compared to 75%), which suggests improved smartwatches due out this year might find a more willing consumer group.

In fact, NPD predicts a significant rise in smartwatch ownership growth starting in the second half of 2016, with an expected overall ownership number of just over 30m devices by the end of 2017.

NPD didn’t say how many fitness trackers would be sold by that time but it’ll be interesting to see the battle developing. In one corner the ultra-functional (and fairly cheap) must-have product for fitness fans. In the other, the often-expensive, do-I-really-need-it luxury that’s worming its way into our consciousness. I do wonder what the picture will be in 10 years time…

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