What you need to know

While 37% of consumers agree that smart glasses with facial recognition should be banned from public spaces, it rises to 48% for Generation Z and Younger Millennials specifically. This is significant because these are the age groups that are the most interested in buying smart glasses. Major social companies including Facebook and Snapchat are investing in smart glasses. Therefore, it is possible that we could see an automatic tagging feature for pictures and video taken from these glasses. With many consumers uncomfortable with face recognition right now, the smart-glasses manufacturers that focus on privacy are likely to be most successful.

COVID-19 is likely to be a key driver behind the significant growth in use of smartwatches to track exercise that has occurred in the last year. Some 57% of smartwatch owners now say tracking exercise is in their top three activities for the devices. This is compared to 44% of smartwatch owners who used their device to track exercise in 2019. Exercise is a key way to reduce stress, and enabling consumers to monitor their stress levels before and after specific types of exercise is an example of an important way smartwatch manufacturers can evolve their offerings to provide a more holistic appeal.

Not only do consumers value privacy in terms of face recognition on smart glasses, but across the whole wearables industry. Some 54% of consumers agree that concerns over privacy would influence their choice of wearable technology brand. With smart earbuds being the fastest-growing wearable technology item – ownership is at 15% now compared to 10% in 2019 – there is a major threat in relation to the privacy of voice assistants on these devices. Some 24% of smart earbud owners use the voice assistant on their device. Devices like the Amazon Echo Buds and AirPods Pro include the always-on functionality, which can be manually muted or turned off. Therefore, it is likely to be appealing if earbuds can automatically learn to mute themselves, based on prior usage.

Key issues covered in this Report

  • The short-, medium- and long-term impact of COVID-19 on wearable technology, including changing usage habits and buying intentions.

  • The growing popularity of smart earbuds, which brands are the more popular, which features are most important to consumers and which innovations can enable companies to earn market share.

  • Ownership of smartwatches, which brands are most popular and how consumers’ usage of these devices has changed since last year.

  • Consumers’ interest in niche wearable technology products like smart glasses, smart clothing and smart jewellery, and potential barriers to purchase.

COVID-19: market context

The first COVID-19 cases were confirmed in the UK at the end of January, with a small number of cases in February. As the case level rose, the government ordered the closure of non-essential stores on 20 March.

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. It wasn’t until 15 June that non-essential stores were allowed to reopen, followed by pubs, restaurants, hotels and hairdressers on 4 July, and many beauty businesses on 13 July.

By September, it had become clear that the UK was at the start of a second wave, and social-distancing measures were intensified. Continued increases in infection numbers led to Wales implementing a two-week national lockdown from 19 October, England announcing a full month-long lockdown from 5 November, and Scotland introducing a new five-level system of coronavirus restrictions.

The national lockdown in England was ended on 2 December, with the country returning to the ‘medium alert’, ‘high alert’ and ‘very high alert’ tier system that it had implemented in October.

Economic and other assumptions

Mintel’s economic assumptions are based on the Office for Budget Responsibility (OBR)’s central scenario included in its July 2020 Fiscal Sustainability Report. The scenario suggests that UK gross domestic product (GDP) could fall by 12.4% in 2020, recovering by 8.7% in 2021, and that unemployment will reach 11.9% by the end of 2020, falling to 8.8% by the end of 2021.

The current uncertainty means that there is wide variation on the range of forecasts, however, and this is reflected in the OBR’s own scenarios. In its upside scenario, economic activity returns to pre-COVID-19 levels by Q1 2021. Its more negative scenario, by contrast, would mean that GDP doesn’t recover until Q3 2024.

The Welsh and English lockdowns will inevitably have an impact on GDP and consumer finances, potentially shifting the UK closer to the OBR’s downside scenario. The market forecasts in this Report reflect this new reality.

From the start of the outbreak, we have made the assumption that an effective vaccine would not be widely available until well into 2021. On 9 November, Pfizer and BioNTech announced highly encouraging results from trials of their vaccine, followed by similarly positive results from Moderna. This means that a vaccination programme may be brought forward, but a full roll-out will take many months, meaning that Mintel is still making the assumption that we will be living with COVID for some time to come.

Products covered in this Report

For the purposes of this Report, Mintel has used the following definitions:

  • The term ‘wearable technology’ (also referred to as ‘wearable devices’ or ‘wearables’) in this Report refers to a category of technology devices that can be worn on the body, either as an accessory or as items of clothing.

  • Generally, wearable technology products can perform some of the same computing tasks as smartphones and have the ability to connect to the internet, which enables data exchange. In addition, they can provide sensory and scanning features such as biometrics and tracking of physiological functions and allow for real-time access to this information.

  • As far as this Report is concerned, the definition encompasses smartwatches, fitness bands, Global Positioning System (GPS) watches, wearable cameras, smart clothing, smart jewellery and smart glasses/headsets. Although virtual reality (VR) headsets could be considered items of wearable technology, they are not included in the definition for this Report. Instead, they are covered in their own, separate Mintel Virtual Reality – UK, December 2020 Report.

  • The terms ‘fitness bands’ and ‘fitness trackers’ are used interchangeably and refer to wrist-worn devices that are focused on tracking health, wellbeing and exercise. Some ‘fitness bands’ or ‘fitness trackers’ also incorporate smart functionality, such as displaying notifications from a connected smartphone.

  • The term ‘sports watch’ refers to a device that has many similarities to ‘fitness bands’ or ‘fitness trackers’ in terms of the focus on health, although ‘sports watches’ often have a circular watch face akin to a traditional watch.

  • The term ‘smartwatch’ refers to a device that offers the features of a sports watch but also supports app downloads.

  • Mintel market size estimates only cover fitness bands, sports watches and smartwatches.

  • This Report only covers the UK consumer market for wearable technology. B2B (business-to-business) sales are excluded from market data, and analysis refers only to trends in consumer markets unless specifically stated.

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