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Wearable Technology - UK - December 2017

OVERVIEW
What you need to know
Products covered in this report
EXECUTIVE SUMMARY
The market
Sales of wrist-worn wearables approach 4 million in 2017
Figure 1: Estimated unit sales of wrist-worn wearable devices, by product category, 2016-17
Worldwide volumes buoyed by low price offerings in Asian markets
Smartwatches offer an avenue for new app revenue
Cheap body-worn cameras prompt strong worldwide growth
Child-friendly smartwatches provide an entry-level device before smartphones
Wearables in healthcare
Companies and brands
Apple joins companies offering smartwatches with LTE
New sensors for measuring stress
The consumer
The gap is closing between fitness bands and smartwatches
Figure 2: Ownership of portable devices, September 2017
Consumers consider smartwatches over fitness trackers
Heart rate sensor accuracy is important to consumers
Figure 3: Wearable devices that consumers are considering purchasing, September 2017
Health and wellness monitoring the most popular use case
Connected home compatibility trumps sports tracking for tech enthusiasts
Figure 4: Interest in uses of wearable technology, September 2017
Smartwatches unlikely to replace mobiles except in specific circumstances
Figure 5: Consumer attitudes towards wearable technology, September 2017
The majority of consumers want ‘normal’ looking smartwatches
Data collection and sharing
Features of smartwatches aren’t attractive enough yet
Figure 6: Consumer perceptions of the benefits of wearable technology, September 2017
Consumers are hopeful about the future of wearable technology
Data sharing must be approached cautiously
What we think
ISSUES AND INSIGHTS
Broader healthcare tracking options appeal to consumers
The facts
The implications
Moving beyond the early-adopter market
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Wrist-worn wearables show steady UK growth in 2017
Smartwatches stretch past fitness trackers
Worldwide shipments of fitness trackers bolstered by Asian markets
Smartwatches focus on sport, whilst fitness trackers add smart functionality
Healthcare tracking a key driver for wearable technology
A smartwatch market for children is developing
MARKET SIZE AND SEGMENTATION
Sales of wrist-worn wearables approach 4 million in 2017
Figure 7: Estimated unit sales of wrist-worn wearable devices, by product category, 2016-17
Worldwide volumes buoyed by low price offerings in Asian markets
Figure 8: Forecast volume sales of wearable device worldwide (millions of units), 2016-18
Smartwatches offer an avenue for new app revenue
Body-worn cameras remain a niche device with few use cases
MARKET DRIVERS
More advanced features across the board
New users take advantage of discounted models
Child-friendly smartwatches provide an entry-level device before smartphones
Figure 9: The VTech Kidizoom Smart Watch takes photos and allows filters to be applied
Wearables in healthcare
Headphones getting smarter
Smart clothing and jewellery yet to take off
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Traditional fashion brands adopting smartwatch technology
Apple joins companies offering smartwatches with LTE
Insurers add health tracking incentives to their products
New sensors for measuring stress
Wearables broaden their appeal
LAUNCH ACTIVITY AND INNOVATION
Traditional watch manufacturers add Android Wear
Apple watch adds cellular connectivity
Fitbit enters the smartwatch market
Healthcare tracker Snap40 gets £1 million NHS funding
Vitality offers heavily discounted Apple Watch
New sensors provide stress and mindfulness tracking
ADVERTISING AND MARKETING ACTIVITY
Apple and Fitbit lead adspend
Sponsorship deals get wearable technology seen
Figure 10: Total above-the-line, online display and direct mail advertising expenditure on smartwatches and fitness trackers, Dec 2016-Nov 2017
Nielsen Ad Intel coverage
THE CONSUMER – WHAT YOU NEED TO KNOW
Smartwatch ownership continues to rise
Wearable cameras remain a niche device primarily for under-34s
Smartwatches appeal to users above other wearable technology
Health and wellness most popular use for wearable technology
The majority of consumers want ‘normal’ looking smartwatches
Features of smartwatches aren’t attractive enough yet
OWNERSHIP AND ACQUISITION
The gap is closing between fitness bands and smartwatches
Figure 11: Ownership of portable devices, September 2017
Wrist-worn device ownership peaks in 25-34-year-olds
Figure 12: Smartwatch and fitness band/sports tracker ownership, by gender, September 2017
Figure 13: Smartwatch ownership, by age bracket, September 2017
Figure 14: Fitness band/sports watch ownership, by age bracket, September 2017
Ownership of wearable cameras
Clip-on activity trackers and heart rate monitor chest straps
PURCHASING CONSIDERATION
Consumers consider smartwatches over fitness trackers
Figure 15: Wearable devices that consumers are considering purchasing, September 2017
Fitness trackers appeal to a wide age range
Heart rate sensor accuracy is important to consumers
Wearable cameras a popular device, but consumers don’t think their activities are worth filming
Smart earbuds least popular of wearable devices
Smartwatches and wearable cameras popular amongst those considering a single wearable device
Figure 16: Proportion of users considering a wearable technology device for purchase, by the number of wearable devices selected, September 2017
USES OF WEARABLE TECHNOLOGY
Health and wellness monitoring the most popular use case
Figure 17: Interest in uses of wearable technology, September 2017
Figure 18: Measuring/tracking electronically and interest in measuring/tracking electronically aspects of health and lifestyles, August 2017
Connected home compatibility trumps sports tracking for tech enthusiasts
Figure 19: Interest in possible wearable technology usage, by number of selected uses, September 2017
ATTITUDES TOWARDS WEARABLES
Smartwatches unlikely to replace mobile except in specific circumstances
Figure 20: Consumer attitudes towards wearable technology, September 2017
The majority of consumers want ‘normal’ looking smartwatches
Figure 21: Preference for a smartwatch that resembles a traditional watch, by age category, September 2017
Figure 22: Design of the Samsung Gear s3 (left) and the Apple Watch Series 3 (Right)
Data collection and sharing
PERCEIVED BENEFITS OF WEARABLE TECHNOLOGY
Features of smartwatches aren’t attractive enough yet
Figure 23: Consumer perceptions of the benefits of wearable technology, September 2017
Consumers are hopeful about the future of wearable technology
Data sharing must be approached cautiously
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – KEY DRIVER ANALYSIS
Methodology
Step I. Demographic indicators:
Step II. Attitudinal indicators:
Interpretation of results
Figure 24: Key drivers of smartwatch purchasing consideration – Key driver output, October 2017
Figure 25: Key drivers of fitness band/sports watch purchasing consideration – Key driver output, October 2017
Figure 26: Key drivers of smartwatch purchasing consideration, October 2017
Figure 27: Key drivers of fitness band/sports watch purchasing consideration, October 2017

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