The global wearable electronics market is forecast to reach $25.19-billion with a corresponding volume of 142.6-million units by 2020, according to a new report by Allied Market Research.
The market revenue is expected to grow at a CAGR of 26%, while volume would witness a CAGR of 23% during forecast period (2014 – 2020). North America currently holds the largest market share; however, Europe will grow the fastest to become the largest market for wearable electronics.
Usage of wearable is still at its nascent stage; nevertheless, the dawn of mobile wireless systems and smart phones have sparked a new era for wearable electronics, globally. Gadgets, which were deemed to be just used in industrial and commercial applications are now finding place in mundane activities, enhancing quality of life through various applications such as healthcare, sports & fitness, and lifestyle to name a few. The industry is being driven by various factors such as convergence of technologies, rising number of customers adopting digital services, and due to the presence of wireless connectivity. However, lack of design features, higher power usage of wearable devices, high initial investment and users’ concerns regarding data privacy are some of the major challenges for the players operating in wearable electronic space.
The global market for wearable electronics was valued at $4.01 billion in 2013. This includes all forms of wearable electronics, devices, and applications. Lifestyle applications accounted for a major share in the consumer application segment and had 20% market share of the overall market. Further, the market for lifestyle and fitness is anticipated to have the highest growth amongst other applications. Defense and Industrial applications were other major applications, which had over 22% market share of the overall market.
Key Findings of the Report:
* The global wearable electronics product market is dominated by wrist wears, which contributes to approximately 45% of the overall market.
* In terms of applications, lifestyle and fitness segments account for 38% of the overall pie.
* North America accounts for about 40% of the demand for wearable electronics for both consumer and commercial applications.
* In terms of product components, memory components account for approximately 23% of the overall market for wearable electronics by components.
* The market is dominated by large players such as Google, Nike, Adidas, etc. There are a number of small players in the market, who offer products for wearable electronics. However, most of the players are based in the US and this market is slowly but steadily finding its way into other locations targeting other geographies.
Typically, smaller firms have limited scope of operations, both in terms of products and geography. In contrast, leading players have integrated operations through their other offerings such as smart phones, and electronics products. These integrated players work with vendors supplying components and aim to build capabilities across the value chain – from components to retailing finished wearable electronics.
However, companies like Jawbone and Fitbit have raised a lot of capital through funding based on their business ideas and are now competing with large players in the wearable electronics space.