India ranks as the world’s second largest market for wearables, following China, and has at times even topped the charts as the biggest market for smartwatches. Nevertheless, the second quarter saw a 10% drop in wearable shipments year-over-year, totaling 29.5 million units, with the first six months witnessing a 4.7% decline to 55.1 million units, as per insights from analyst firm IDC outlined recently.
Experts predict a continued downturn in the coming months, attributing much of it to the smartwatch segment.
The latest data highlights a 27.4% YoY decrease in smartwatch shipments within India, plummeting to 9.3 million units in Q2, down from around 12.8 million. Further analysis by Counterpoint confirmed to TechCrunch a steep 30% YoY decline in India’s smartwatch market.
Emerging unknown brands have put pressure on established Indian smartwatch companies earlier this year, as reported by TechCrunch. With difficulty in market differentiation, some brands are exploring other niches like smart rings to boost their revenue streams.
The proportion of smartwatches within the broader wearable market fell to 31.5% from 39% the previous year, as reported by IDC.
“The decline in India’s smartwatch market is mainly due to innovation fatigue and the introduction of models lacking new features by local brands,” revealed Vikas Sharma, IDC’s senior market analyst for smart wearable devices, in a conversation with TechCrunch.
India’s leading smartwatch manufacturers — Noise, Fire-Boltt, and boAt — all experienced significant declines in Q2. Additionally, the average selling price for smartwatches in India dropped to $20.6 from the previous $25.6 as brands endeavored to reduce their inventories through price reductions.
However, these price reductions have not succeeded in boosting customer interest.
“The market’s stagnation is due to consumers’ reluctance to purchase or upgrade to new smartwatches, given the lack of feature differentiation and minimal innovation,” Counterpoint’s senior analyst Anshika Jain explained to TechCrunch.
Jain observed that the once rapid growth of smartwatches in India is now subsiding as the initial enthusiasm for the product category diminishes.
“This trend is evident in the dropping growth rates and the grim market outlook,” the analyst commented.
Contrastingly, high-end smartwatches featuring an app store and running a comprehensive operating system saw a 21.9% surge, with their market share climbing to 2.5% from 1.5%, as per IDC’s findings.
However, TechCrunch learned from the firm that tech giants Apple and Samsung witnessed approximately 29% and 26% drops in their quarterly smartwatch shipments, respectively.
Apple managed to secure 0.5% of the overall smartwatch market in India, with 35,000–40,000 units of the Apple Watch shipped in Q2, while Samsung held a 0.9% share with 75,000–80,000 units, according to the firm.
Sharma attributes the decline in market share for Apple and Samsung to a cyclical pattern.
“Samsung’s new watch launches towards the end of Q2, coupled with a lack of bundle offers, influenced the market. People often wait for online sales to acquire high-priced watches at a discount. For a period, Samsung had ended its bundle offers, which previously allowed customers to purchase its smartwatches for about $36 when bought alongside a flagship smartphone,” he explained.
He also mentioned that Apple Eyeing updates to its Watch lineup, the company has been focusing on liquidating older inventory.
As for the advanced smartwatch segment, it witnessed growth as some Indian firms introduced models equipped with full Android — not Google’s Wear OS — and the Google Play Store, dubbing these devices “WristPhones,” thanks to their nano SIM card slot enabling voice calls.
Nevertheless, both IDC and Counterpoint predict a 10% decrease in the nation’s annual smartwatch shipments, anticipating a significant downturn this year.
Stagnation in Headphone Shipments
Alongside the downturn in smartwatches, the headphone segment in India has plateaued according to IDC, with 20.1 million units shipped in Q2, marking a negligible 0.7% growth YoY. The true wireless stereo (TWS) category saw a 9.1% increase YoY, grabbing a 71% market share, up from 65.5%. However, other categories such as neckband-styled and over-ear headphones experienced a 16.1% decline, totaling 5.8 million units.
Homegrown brands continue to lead in this space, followed by Chinese brands Oppo and Realme. Apple (along with Beats) and Samsung (including its sub-brands JBL, Infinity, and Harman) accounted for meager shares of 0.9% and 2.3%, respectively.
Sharma informed TechCrunch that the observed decline in the headphone sector is a temporary setback, with a sustained interest in TWS earbuds still present.
India also sees a sizable influx of non-branded earbuds, available online and in retail outlets, which IDC does not track.
“The third quarter is expected to show a significant uptick compared to the second quarter for headphones,” Sharma noted. However, he does not foresee smartwatches making a turnaround until at least 2026, according to Jain.
“Post-2026, we anticipate the smartwatch market will bounce back, driven by novel applications and use-cases,” she added.
Compiled by Techarena.au.
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