In a significant development, India has surpassed North America to take the top global spot in the smartwatch market, according to a report from market research player Counterpoint. The quarter that ended in September witnessed a remarkable growth of 171% year-on-year, driven by the festival sales and proliferation of affordable smartwatches.
Affordable Smartwatches Drive Growth
The affordable smartwatch models with bigger displays and features like Bluetooth calling were key selling factors in India during the festival sales. As per Counterpoint, Bluetooth-calling emerged as an important feature, contributing a 58% share in total shipments, the highest ever share to date. Consumers are also preferring bigger display sizes, which is evident from the fact that over half of the total shipments in Q3 came from the 1.5′-1.69′ display size.
Indian Brands Expand Product Portfolios
Indian brands expanding their product portfolios at affordable price points and emphasis on local manufacturing also contributed to the growth, said Counterpoint analyst Anshika Jain in a statement. "Indian brands are rapidly increasing their local production output to increase the production rate and bring down device prices further," added Woojin Son, research analyst.
Noise Captures Third Place
India’s growth meant that the country’s top brand, Noise, captured third place on overall shipment charts — thanks to a 218% year-on-year growth — only lagging Apple and Samsung. The smartwatch maker aims to scale its local production from 50% to 80% by the end of the year.
Apple and Samsung Perform Well
Apple grew 48% due to stellar sales of the new Apple Watch 8 series, which accounted for 56% of overall sales. Samsung grew 6% year-on-year despite registering a 62% shipping increase from the previous quarter.
Counterpoint’s Report Segregates Smartwatches into Two Categories
Counterpoint’s report segregates smartwatches into two categories: High-level operating system (HLOS) smartwatches and basic smartwatches. The HLOS segment grew 23%, whereas basic smartwatches grew by more than double — resulting in a commanding 35% of the market share.
Market Share of HLOS vs Basic Smartwatches
Apple currently dominates the HLOS market with about 50% market share, whereas Samsung sits second in the chart. The research shop said that the HLOS segment grew 23%, whereas basic smartwatches grew by more than double — resulting in a commanding 35% of the market share.
ASP and Revenue Comparison
The ASP of basic smartwatches is $27.5 as compared to the $330 ASP of advanced smartwatches, said IDC. This is an indicator that Indian consumers are likely to go for cheaper alternatives than the Apple Watch or the Samsung Galaxy Watch.
Local Manufacturing Output
All India-based smartwatch manufacturers have committed to rapidly increasing their local manufacturing output in the coming months. This could help them bring down device prices further and increase shipments to catch up with Samsung and Apple in unit shipments.
Why India’s Smartwatch Market is Growing
- Affordable smartwatches: The proliferation of affordable smartwatches has driven growth in India.
- Local manufacturing: Indian brands expanding their product portfolios at affordable price points and emphasis on local manufacturing have contributed to the growth.
- Emphasis on local production: All India-based smartwatch manufacturers have committed to rapidly increasing their local manufacturing output.
What’s Next for India’s Smartwatch Market
- Increased competition: The market is expected to become more competitive with new entrants, such as Google and Amazon, entering the fray.
- Growing demand for basic smartwatches: Consumers in India are likely to opt for cheaper alternatives to advanced smartwatches.
- Focus on local production: Indian brands will continue to focus on increasing their local manufacturing output to bring down device prices further.
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